further random questions Flashcards
(47 cards)
The tax year ends on:
a.
6 April.
b.
5 April.
c.
31 December.
d.
31 July.
b.
5 April.
The part of a purchased life annuity which is tax free in the hands of the annuitant is the:
a.
interest element.
b.
capital element.
c.
deferred element.
d.
principal element.
b.
capital element.
Jack and Jill are joint mortgagors. Jack, having found a job in another town, has approached the lender, giving notice of his intention to withdraw from the loan agreement. Before giving consent, the lender will wish to ensure that:
Question 3Select one:
a.
another mortgagor is added.
b.
Jill can meet the mortgage payments in full.
c.
Jack transfers his portion of the loan to his new property.
d.
the term of the loan is extended.
B: Jill can meet the mortgage payments in full
Which of the following is NOT a usual entry cost that applies to lifetime mortgage customers?
a.
Stamp duty land tax.
b.
Legal fees.
c.
Valuation fee.
d.
Arrangement fee.
a.
Stamp duty land tax.
If an individual wants to take out a regulated lifetime mortgage on a leasehold property, the minimum unexpired term of a lease from the date of the contract is likely to be at LEAST:
b.
80 years.
Isla was widowed in July 2024. She is 56 and has a 15-year old child. Assuming that the eligibility criteria are fulfilled, the lump sum element of Isla’s bereavement support payment will be:
a.
£6,300.
b.
£1,800.
c.
£2,500.
d.
£3,500.
d.
£3,500.
In the case of conventional mortgages, the main concern of the lender is the:
Question 7Select one:
a.
availability of collateral security.
b.
reliability of the guarantor.
c.
ability of the applicant to repay the loan on a long-term basis.
d.
security of the property to be mortgaged.
c.
ability of the applicant to repay the loan on a long-term basis.
Which of the following clients is likely to be eligible for a lifetime mortgage but not a home reversion plan?
.
Dawn, age 63, who lives in the south of England.
b.
Mary, age 66, a recent widow.
c.
Bill, age 59, a self-employed tree surgeon.
d.
Charles, age 61, a retired doctor.
Bill, age 59, a self-employed tree surgeon.
A contingent annuity provides an income:
a.
that escalates with a defined price index.
b.
for a third party, commencing on the death of the annuitant.
c.
for a predefined term.
d.
for the remainder of the life of the annuitant, if they live to a prescribed age.
for a third party, commencing on the death of the annuitant.
Eligibility for new style Employment and Support Allowance is subject to assessment of the claimant’s:
a.
age and the claimant’s NICs record.
b.
age and the claimant’s marital status.
c.
condition and the number of the claimant’s dependents.
d.
condition and the claimant’s NIC record
condition and the claimant’s NIC record
How does a lender make its return on a shared appreciation mortgage?
a.
From the proceeds of an accompanying repayment vehicle.
b.
Mainly by levying upfront charges.
c.
It charges monthly interest.
d.
It takes a share of the increase in the property value on redemption
.
D. It takes a share of the increase in the property value on redemption
Income from which of the following savings vehicles is exempt from income tax?
a.
Offshore funds.
b.
Deposit Accounts.
c.
Individual Savings Accounts.
d.
Gilt-edged securities.
Individual Savings Accounts.
Equity release can be a useful method of bringing together existing debts with rescheduled payments over a longer time horizon. Such a procedure is known as debt:
a.
elimination.
b.
alleviation.
c.
repayment.
d.
consolidation.
consolidation.
When a home reversion plan has been completed the occupier becomes the:
a. mortgagee.
b.
lessee.
c.
lessor.
d.
borrower.
lessee
Specifically under the rent a room scheme, how much can an individual earn tax free by letting out furnished accommodation in their home?
a.
An amount equal to the personal allowance each year.
b.
£1,000 per annum.
c.
£7,500 per annum.
d.
An amount equal to the National Insurance Class 2 small profits threshold each year.
c.
£7,500 per annum
Is a regulated firm permitted to conduct an unsolicited real time promotion with regards to a regulated home reversion plan?
a.
Yes - but only with the customer’s consent.
b.
No, not in any circumstances.
c.
Yes - in any circumstances.
d.
No, unless the customer is under the age of 70.
Yes - but only with the customer’s consent.
Which FCA sourcebook governs the products which fall under the heading of lifetime mortgages?
a.
COBS.
b.
MCOB.
c.
ICOBS.
d.
BCOB.
b.
MCOB.
Credit unions are mutual organisations:
providing credit to the general public who have impaired credit status.
b.
owned by their members and making loans to members only.
c.
making loans to members and other suitable borrowers.
d.
which exist primarily to give advice to people who find themselves in debt.
b.
owned by their members and making loans to members only.
Below what threshold are transfers of land now effectively exempt from stamp duty land tax in England?
a.
£250,000.
b.
£600,000.
c.
£425,000.
Chapter reference 6C6
d.
£300,000.
a.
£250,000.
In addition to the protection provided by the FCA’s rules relating to the fair treatment of customers, equity release customers enjoy statutory protection under the:
Mortgage Credit Directive.
b.
Consumer Rights Act 2015.
c.
Land Registration Act 2002.
d.
Insurance Act 2015.
Consumer Rights Act 2015.
Which of the following is affected by changing interest rates?
A. Borrowers who make payments to the lender and who are outside any fixed rate period.
b.
Customers with home reversion schemes.
c.
Borrowers with mortgages that have their rate fixed for the entire term.
d.
Borrowers with shared appreciation mortgages.
A. Borrowers who make payments to the lender and who are outside any fixed rate period.
Which of the following statements is correct with respect to ‘cold calling’ potential equity release customers?
a.
It is not permitted under any circumstances.
b.
It is not permitted unless the customer is referred to a provider by an existing client.
c.
It is permitted if part of a wider marketing campaign.
d.
It is allowed within prescribed hours of the day.
It is not permitted under any circumstances.
Suitability rules apply to all regulated mortgage contracts. The rules imply that a firm must obtain information about its customer before proceeding with a recommendation. This is achieved via:
a.
critical path analysis.
b.
a fact-find.
c.
information provided by a previous mortgage lender.
d.
information provided by an agency such as Citizens Advice.
a fact-find.
A guarantee that the debt will not increase if house prices fall and result in a ‘negative equity’ situation is required by members of the:
a.
Council of Mortgage Lenders.
b.
Equity Release Council.
c.
National House Building Federation.
d.
National House Building Council.
b.
Equity Release Council.
