9) THE ROLE OF THE MORTGAGE ADVISER

Question 1

Which are the two key factors estd by info gathered?

Answer 1

1) How much potential borrower can afford each month
2) Type of mortg they wd prefer
(better qly and accuracy of info gathered, greater chances of appln being successful)

Question 2

What is the advice process?

Answer 2

1) Factfind - type of mortg and how much potential to borrow
2) Research - the best solution/mortg that fits
3) Present - After deciding on the best, most suitable mortg, present that recommendation to cust

Question 3

What does factfind cover?

Answer 3

1. Intentions - type of prop and intended purchase price
2. Income and outgoings
3. Deposit and cash - Dep and cash avai to meet expenses
4. employment - current status and history - future prospects, any previous redundancies, cutbacks?
5. Mgt of finances - Customer’s budget and their ability to cope with rises in rates in future, esp if they are considering fixed, capped or discount mortg, leaving little or no spare income,
6. Early repayment - potential/intention either partial or total
7. Term
8. Protection needs - life cover, mortg payment protection etc
   9 Attitude to risk - normally in the form of a risk questionnaire resulting in a risk profile

Question 4

Which FCA principles for Businesses reflects FCA’s objective of securing fair treatment of customers?

Answer 4

Principle 2: A firm must conduct its business with due skill, care and diligence.

Principle 3: A firm must take reasonable care to organise and control its affairs responsibly and effectively, with adequate risk management.

Principle 6: A firm must pay due regard to the interest of its customers, and treat them fairly.

Principle 7: A firm must pay due regard to the information needs of its clients, and communicate information to them in a way that is clear, fair and not misleading