Topic 15 Other factors that affect the lending decision Flashcards
(77 cards)
1
Q
Why is it important for a home owner to seek planning consent?
A
Unauthorised building works may:
- devalue the property
- Lenders may not lend
- May need to reinstate the property to its original state
2
Q
What does “Permitted Development” allow a home owner to do?
A
Carry out certain developments without the need to seek planning permission
3
Q
What is “Designated Land”?
A
- Conversation areas
- Areas of outstanding natural beauty
- World heritage sites
- National parks
4
Q
These are situations where a home owner can do what?
- Addition & previous additions do not cover more than half the area of the original house
- The extension is within certain height & depth limits
- Building materials match the existing building
- Converting a garage internally does not add to the size of the building
A
Build an extension, Conservatory or addition to the home without planning consent
5
Q
These are situations where a home owner can do what?
- Loft extension does not exceed 50³ (detached house) or 40³ (other homes)
- Erecting aerials or satellite dishes
A
Build an extension, Conservatory or addition to the home without planning consent
6
Q
What does the “Neighbour Consultation Scheme” do?
A
Report to the local authority & in turn the neighbours of single storey extensions from the rear wall or the original house wall
- 8 meters detached house
- 6 meters other property types
7
Q
The “Original House” refers to the house as it was originally built on or before what date?
A
1st July 1948
8
Q
These types of work all require what?
- Work on existing property outside the scope of permitted development
- Work listed property or property in conservation area
- Building a new property
A
Planning consent
9
Q
These types of work all require what?
- Converting an exciting building
- Dividing a single property into separate homes
- Work that would contravene original planning consents
A
Planning consent
10
Q
If a previous owner had not gained planning consent what could happen to the new owner?
A
They could suffer consequences because of it
11
Q
To apply for planning consent who would a home owner need to apply to?
A
Local authority or council planning department
12
Q
What are “Building Regulations”
A
- Structure of a development
- Materials used
13
Q
Is the below covered or exempt from building regulations?
- Erection of a new building
- Extension of an exciting building
- Cavity wall insulation
A
Covered
14
Q
Is the below covered or exempt from building regulations?
- Adding or removing internal walls
- Loft conversion
- Underpinning of a buildings foundations
A
Covered
15
Q
Is the below covered or not covered from building regulations?
- Carport extension open on at least 2 sides & under 30³ floor area
- Detached garage under 30³ & built at least 1 metre from the boundary of the property
- New garden or boundary wall
A
Not covered
16
Q
What must be carried out on a sample of new homes in all developments?
A
Air leakage tests
17
Q
What is a “Listed Building”?
A
A building that is of significant architectural or historical value
18
Q
If an owner of a listed building wants to demolish, change or extend a listed building what do they need to obtain?
A
Listing building consent
19
Q
What type of listed building is the below?
- Buildings of exceptional interest
- Represent 2.5% of all listed buildings
A
Grade 1
20
Q
What type of listed building is the below?
- Buildings of particular importance
- Represent 5.5% of all listed buildings
A
Grade 2*
21
Q
What type of listed building is the below?
- Buildings of special interest
- Represent 92% of all listed buildings
A
Grade 2
22
Q
- Local authorities
- Bodies such as (Historical England, Secretary of state for communities & local government)
Are all likely to control what areas of architectural or historical interest?
A
Conservation areas
23
Q
Trees with historical significance may be subject to “Tree Prevention Orders”
True or False
A
True
24
Q
What are 3 environmental issues that may affect property value?
A
- Radon gas
- Contaminated land
- Overhead electrical power lines
25
Subsidence in some areas can have been caused by causes by what industry?
Mining
26
Who is responsible for repairs on a property in a mining area due to subsidence?
The mine owner
27
What are other environmental factors that may affect a property's value?
- Flood plans
- Busy roads
- Mobile phone masts
- Substations
28
Which government scheme pays home owners who generate electricity from wind turbines or solar panels for use in the national grid?
Smart Export Guarantee (SEG)
29
The below are disadvantages to the home owner of what having what renewable energy type on the property?
- Installations can be intrusive & may reduce property appeal to perspective owners
- Maintenance & repairs are responsibility of the owner
- May take upto 10 years to recoup cost of the panels
Solar panels
30
What is "rent-a-roof" scheme?
Where a company lease's a properties roof & installs solar panels on it to uses the electricity generated
31
How long does the "rent-a-roof" scheme normally last?
20-25 years
32
Why is it difficult to obtain a loan on agricultural land?
The Agricultural Holdings Act 1948 gives tenants a high degree of security.
Lender may find it difficult to exercise security
33
What happens if a borrower requires a higher LTV than a lenders threshold?
Borrower may need to pay for additional security
34
Where LTV exceeds a certain level what may a lender do to the customer?
Charge a "Higher Lending Charge"
35
Under MCOB rules what is a lender required to do about "Higher Lending Charges"
Explain the charge as a "Higher Lending Charge"
36
What may a lender do with a "Higher Lending Charge" it may receive from a customer
Buy a Mortgage Indemnity Guarantee (MIG)
37
What would a Mortgage Indemnity Guarantee (MIG) do?
Protects the lender if the borrower defaults & the sale proceeds of the property are not enough clear the mortgage
38
Who pays the premium for a Mortgage Indemnity Guarantee (MIG)?
Lender or Borrower
Borrower
39
What is "Subrogation"?
The right of an insurer to pursue **a third party that caused** an insurance claim by the insured
40
How many years does a Mortgage Indemnity Guarantee (MIG) insurer have to exercise it's right of Subrogation?
6 years
41
What percentage is usually the excess on a Mortgage Indemnity Guarantee (MIG)?
20%
42
Estate agent fees are generally what percentage of the sale price of a property?
1-3.5%
43
What mortgage fee is this?
- Payable when borrower wishes to take advantage of a special deal
- Maybe refundable if the mortgage does not go ahead
- Can usually be added to the loan
Product fee
44
What mortgage fee is this?
- Charged by some lenders or some or all of their products to cover assessing & processing an application
- Fee varies between £50-£2000 (includes a basic valuation)
Application fee
45
What mortgage fee is this?
Where LTV exceeds a certain level
Higher Lending Charge
46
What mortgage fee is this?
- £50 may need charged by an exciting lender to new lender with a reference to conduct of excising account
Lender's reference fee
47
What mortgage fee is this?
- May be charged by a broker to arrange the mortgage
- Must be stated clearly in the intermediary's initial disclosure
- Normally a fixed charge
- Intermediary may receive a procuration fee from lender
Adviser fee
48
What mortgage fee is this?
Mortgage packers fees ranging from a percentage of the mortgage to a flat fee of around £300
Mortgage packers fees
49
What do MCOB rules require a lender to do if a customer pays off their mortgage early?
State the amount of any fees on the redemption date
50
The below are what in relation to a lenders costs when redeeming a mortgage?
- Deed Release Fees
- Land Registry Charges
- Staff Processing Costs
- Proportion of general overheads
What the FCA considers acceptable components of a lenders costs
51
These are all fees & disbursements incurred by who?
- Local Authority searches
- Land Registry search
- Environmental searches
- Drainage search
Conveyancer
52
These are all fees & disbursements incurred by who?
- Bankruptcy search
- Land registration fees
- Indemnity fees
Conveyancer
53
All these searches by a Conveyancer have what in common?
- Local Authority searches
- Land Registry search
- Environmental searches
- Drainage search
- Bankruptcy search
They are non-refundable & pre exchange of contract
54
If Land Registration fees are paid online the fees are reduced by 50%?
True or False
True
55
Stamp Duty Land Tax (SDLT) applies to which counties in the UK?
- England
- Northern Ireland
56
Within how many days does Stamp Duty Land Tax (SDLT) have to be paid after completion?
14 days
57
These are what in relation to Stamp Duty Land Tax (SDLT)?
- Purchase of a freehold property less than £40,000
- Transfer does not involve a payment (gift)
- Property is inherited from a deceased persons estate
Exemptions where Stamp Duty Land Tax is not payable
58
If someone purchases a Leasehold property with an existing lease Stamp Duty Land Tax (SDLT) is payable. What about the SDLT payable on the ground rent?
Stamp Duty Land Tax is not payable on ground rent for an existing lease
59
If a first time buyer purchases a leasehold property with a new lease they have to pay Stamp Duty Land Tax (SDLT)?
True or False
False
They qualify for the first time buyer exemption
60
Properties under what value are free of Stamp Duty Land Tax (SDLT) under what value?
£425,000
61
The criteria to qualify for Stamp Duty Land Tax (SDLT) first time buyer exemption are what?
- First time buyer (including joint buyers
- Main residence
- Property is a **single dwelling**
62
Does Stamp Duty Land Tax (SDLT) apply to a shared ownership property?
Yes on both the market value of the property or the shares being purchased
63
If a person has either a Buy to Let or a second home over £40,000 they are subject to an additional Stamp Duty Land Tax (SDLT) surcharge at what percentage?
3%
64
The second property & BTL surcharge (£40,000 or above) only applies if the purchaser of a property owns a major interest in a property and then buys another property not to replace their main residence?
True or False
True
65
In relation to the Stamp Duty Land Tax (SDLT) for second home or Buy to Lets (BTL) what are the below?
- One partner owns a property already
- Home owning parent helps child buy a property & becomes an owner of that property
- Owns property abroad then buys a UK property
Where the Stamp Duty Land Tax (SDLT) surcharge applies to joint borrowers
66
If a person buys a new property to be used as their main residence before selling their existing home
Or
A person sells their home, keep a BTL and then buys a new main home
They can claim a refund but within how months do they have to do this?
36 months
67
If a parent helps their child buy their first property but wants to be a registered owner to offer security or helps them afford the mortgage. They would not be eligible for the the second property surcharge or first time buyer exemption.
How would a lender to avoid this anomaly?
Offer a joint borrower sole proprietor mortgage (in child name)
68
The below are what in relation to married couples & civil partners for Stamp Duty Land Tax (SDLT) surcharge?
- Court order allows a one person to stay in the property (part of divorce settlement)
- Separation is going to be permanent & one partner buys a property before the family home is sold
Where Stamp Duty Land Tax (SDLT) surcharge does not apply for married customers & civil partners
69
How is Stamp Duty Land Tax (SDLT) charged if a purchaser buys more than 1 residential property from the same vendor at the same time in a single transaction
Average value of each property
70
The Land & Buildings Transaction Tax (LBTT) is equivalent of Stamp Duty Land Tax (SDLT) for which UK country?
Scotland
71
The Land Transaction Tax (LTT) is equivalent of Stamp Duty Land Tax (SDLT) for which UK country?
Wales
72
Does Land Transaction Tax (LTT) in Wales have a first time buyer exemption?
No
It has raised the nil-rate band threshold
73
Is a detached garage with a floor area of 20³ **Covered** or **Exempt** from building regulations?
Exempt
74
A loft extension that adds height to an existing building does not require planning permission?
True or False
False
It does at it is adding height to an existing property
75
If a two-storey extension is closer than 7 meters from the rear boundary of a property is planning permission required
Yes
76
Local authorities have a general duty to enforce building regulations in their area?
True or False
True
77
Land registration fees are payable on the day of completion?
True or False
False
They are payable after completion
