Topic 3 - Mortgage regulations

Question 1

Types of Mortgages

Answer 1

Mortgage by demise

Mortgage by way of legal charge

Question 2

Mortgage by demise

Answer 2

Transfer of property from seller to lender on completion of loan

Question 3

Mortgage by way of legal charge

Answer 3

Deed states asset is charges with a debt

Question 4

EU Mortgage credit directive

Answer 4

Member states included

Set up minimum requirements

Question 5

Regulates Home finance

Answer 5

Lifetime mortgages
Home reversion plans
Home finance plans
Consmer buy to let
regulated mortgages
MCD regulated mortgages

Question 6

Lifetime mortgage

Answer 6

Home owners
release. a percentage of their equity
Ends when homeowner moves on

Question 7

retirement interest only mortgages

Answer 7

• restricted to age

- Lender not entitled to seek full repayment until they move on

Question 8

Home Purchase plans

Answer 8

• Provider buys qualifying interest in land
• Home purchaser is obliged to buy the interest from the provider
• Occupy 40% of land

Question 9

Home reversion plans

Answer 9

• Provider buys property from owner
• Former owner continues to live in the property
• At end the property belongs to provider

Question 10

Business buy to let

Answer 10

• The borrower has 1+ properties
• Sole intention lending
• 40% or less is residential
• Primarily for business

Question 11

MCOB sourcebook 1

Answer 11

1. Application and purpose
   2.Conduct of business standards
   2A. Mortgage credit directive
   3A. Financial Promotions
   3B. MCD general information
2. Advising and selling standards

Question 12

MCOB sourcebook 2

Answer 12

4A. Additional MCD advising and selling standards
5. Pre-application disclosure
5A. MCD Pre-application disclosure
6. Disclosure at the offer stage
6A.MCD disclosure at the offer stage
7.Disclosureat start of contract and after sale

Question 13

MCOB sourcebook 3

Answer 13

7A. Additional MCD disclosure
7B.MCD further advances 
8. Equity release: advising and selling standards
9. Equity release: product disclosure 
10.Annual percentage rate
10A.MCD annual percentage rate of charge

Question 14

MCOB sourcebook 4

Answer 14

11. responsible lending and responsible financing of home purchase plan
    11A. Additional MCD responsible lending requirements
12. Charges
13. Arrears, payment shortfalls and repossessions
    14.MCD article 3 credit agreements
    15.MCOB 15: P2P home finance activities