Daily questions Flashcards
Under FCA regulations, the definition of a regulated mortgage contract specifically excludes:
A debt consolidation.
B home improvement loans.
C commercial lending
D bridging loans.
C
Mike is looking to buy a property at auction. He has £70,000 in cash and an unsold property with equity of £80,000. He has put in a mortgage application for £65,000. What is the maximum he should bid at the auction?
A £70,000
B £135,000
C £150,000
D £215,000
A
Which of the following statements is true in relation to a buyer withdrawing from a house purchase transaction the day before exchange of contracts?
A The potential buyer is entitled to withdraw and has no liability for expenses or other costs.
B Because the vendor had accepted the offer to buy in good faith, he may sue for breach of contract.
C Because of the lateness of the withdrawal, the vendor is entitled to retain the deposit paid.
D The vendor is entitled to claim all reasonable expenses incurred to date.
A
The requirement for a Home Information Pack was suspended in May 2010, but which element is still required?
A Property Information Questionnaire (PIQ)
B Replies to standard preliminary enquiries
C Evidence of title
D Energy Performance Certificate
D
On a with-profits policy, what is a reversionary bonus?
A An irregular payment, determined by the type of policy and the number of lives assured.
B A payment made on maturity at the discretion of the assurance company.
C One which is declared regularly and, once attaching to the policy, is guaranteed payable.
D One which reverts to a minimum level in the event of a claim.
C
A lender is considering granting a loan on a corner shop property with a flat above. What sort of lending would this be defined as?
A Buy to Let.
B Residential.
C Corporate.
D Semi-commercial.
D
Wendy lives in the end house of a terrace. Adjacent to the property is a wall which Wendy has an obligation to maintain. This is known as:
A a restrictive covenant.
B an easement.
C a positive covenant.
D a personalty.
C
On what basis are mortgages in England and Wales normally created?
A Common property.
B Joint property.
C Joint tenancy.
D Tenancy in common.
C
Gemma is purchasing a property valued at £150,000 and would like to borrow 92% of the property purchase price. At that loan to value level, the lender charges a higher lending charge of 7% of the loan amount over 75% of the valuation. How much will Gemma have to pay?
A. £1,785
B. £2,415
C. £2,625
D. £3,255
A
When determining borrowing limits, a lender is LEAST likely to be influenced by whether a person’s income:
A includes overtime.
B fluctuates on a seasonal basis.
C is paid weekly or monthly.
D is fixed or related to performance.
C
Kevin and Hannah are thinking of buying a property which is 15 years old. Which one of the following is TRUE in relation to surveys?
A It is compulsory that they have a full structural survey.
B It is mandatory that they have a home-buyers report.
C They would be wise to have a home-buyers report.
D They can rely on the basic valuation.
C
How long is the total duration of an NHBC guarantee under their ‘Buildmark Scheme’ for new houses?
A 2 years.
B 10 years.
C 15 years.
D 25 years.
B
Luke is using the funds in his savings account as a collateral deposit for a mortgage loan. This means he:
A cannot normally access these funds until the debt is sufficiently reduced.
B can withdraw these funds at any time provided he replaces them within 90 days.
C must start a new account with the lender and transfer these funds.
D may not start another savings account without the lender’s permission.
A
How does the Murabaha method of Sharia-compliant Islamic mortgages operate?A The lender buys the property and immediately sells it to the borrower at a higher price in return for the payment of fixed instalments over an agreed term.
B The lender buys the property and the borrower pays rent during the agreed term, at the end of which ownership is transferred.
C The borrower and the lender jointly buy the property with interest waived in return for an enhanced capital repayment and ownership transferring in stages.
D The borrower buys the property for a nominal sum and grants a reversionary.
A
Which type of endowment mortgage is MOST likely to give the borrower a surplus at the end of the term?
A Without profits.
B With profits.
C Low cost.
D Unit-linked.
B
