1.4 Freehold Estates - Finance Flashcards
1
Q
What are the types of mortgages?
A
Repayment
- Mortgage term (25 years)
- Part interest/capital
- Mortgage protection term assurance policy
Endowment
- Life assurance policy link > Matures at end of mortgage term
- Monthly payments > Interest only > Includes life policy premium payments
- NO tax relief
- Shortfall > Mortgagor must meet
Pension mortgage
- Personal pension policy > Contributions are tax deductible
- Proceeds on maturity > Discharges loan
Interest-only mortgage
- NO capital repayments
- NO policies/pensions/savings plans
- Client fund repayments of capital in other ways
- Fixed rate/Standard variable rate/Bank of England rate/Tracker rate (0.3% over Base rate)
Sharia-compliant mortgages (Islamic laws)
- Muslims NOT pay interest
- Lenders to offer Sharia-compliant alternatives
2
Q
What is required in a mortgage deed?
A
Complies w LPA 1925/Form CH1
Dated on completion
3
Q
What is required for release of mortgage advance?
A
Certificate of title
- Required by Lender
- Prescribed form
- Marketable title
Borrower’s financial integrity
Held on trust by B’s solicitor
4
Q
What is required for perfection of the mortgage upon completion?
A
Registration at CH
- Within 21 days
Registered land > Register at Land Registry
- Within priority protection period
Unregistered land > 1st registration
- Within 2 months
