Redmill Week 2

Question 1

In England, when is the point of ‘no return’?

Answer 1

In England, the point of no return is once contracts have been exchanged

Question 2

Define ‘fixtures’

Answer 2

Fixtures are things which are part of the property and not easily removeable such as carpet

Question 3

Define ‘Fittings’

Answer 3

Fittings are things that can be removed such as dishwashers and ovens

Question 4

Which is included in the SDLT calculation?

Answer 4

Only ‘fixtures; are included in the SDLT calculation

Question 5

What is ‘gazumping’

Answer 5

Gazumpng is where the seller after accepting one offer, accepts another offer which is higher

Question 6

What is ‘gazundering’

Answer 6

Gazundering is where the buyer waits a few days before the exchange is about to take place then makes a lower offer than the one agreed

Question 7

What is gazanging?

Answer 7

Gazanging is where the seller pulls out of the sale

Question 8

Who does the estate agent owe overall responsibility to?

Answer 8

The estate agent owes responsibility to the seller, not the buyer

Question 9

When must contracts be exchanged on a sale/purchase of a house via a non-conditional public auction?

Answer 9

During a non-conditional public auction, the contract must be exchanged on the same day.

Question 10

During a non-conditional public auction, if the buyer does not have the funds available, what options are available to the seller?

Answer 10

The seller can sue for breach of contract

Question 11

With a conditional auction, how long do the buyer and seller have to exchange contracts?

Answer 11

With a conditional auction, the buyer and seller has 28 days to exchange contracts

Question 12

What is the best type of energy rating?

Answer 12

The best type of energy rating is ‘A’. The lower the number, the better.

Question 13

What is an overriding interest of a property?

Answer 13

An overriding interest is where a partner loves in the property for years and contributes to the bills but isn’t on the mortgage, this could prevent sale of the property

Question 14

Can future changes be considered in the lending decsion?

Answer 14

No future changes cannot be factored in

Question 15

Do mortgages to companies have lower limits and higher interest rates?

Answer 15

Yes, mortgages to companies have lower limits and higher interest rates

Question 16

If the borrower is building the property themselves, what will the lender insist?

Answer 16

If the borrower is building the property themselves, the lender will insist that the builder is a member of the National Hose Building Council (NHBC) or are supervised by a qualified architect

Question 17

What is ‘affordability’ assessed on?

Answer 17

Affordability is assessed on the disposable income of the household

Question 18

With a capital mortgage how would you aim to clear the debt sooner?

Answer 18

With a capital mortgage, to clear the debt sooner you would look to reduce the term, or make overpayments if possible

Question 19

With a capital mortgage, how would you look to decrease the monthly payments?

Answer 19

To decrease the monthly payments, you would look to extend the term of the mortgage.

Question 20

Which type of mortgage is considered high risk?

Answer 20

Interest only mortgages are considered high risk

Question 21

For security on a property, what 3 thing would a lender want in a security?

Answer 21

In a security, a lender would want:
- Simple and not expensive to complete
- Stable
- Realisable and easily and quickly convertible to cash

Question 22

As a result of the Hedly Byrne v Heller and Partner 1964 case, for negligence to exist which three things need to be present?

Answer 22

For negligence to exist the following need to be present:
- A duty of care exists
- There was a breach of that duty of care
- Some loss has arisen from the breach of that duty of care

Question 23

In a level 1 RICS condition report, what is the main thing highlighted? And what type of home is it most suited to?

Answer 23

A level 1 RICS condition report is usually best suited to new conventional homes and highlights the defects on the property.

Question 24

If one has a buy-to-let property, how much would the lender want the rent to be in comparison to the mortgage repayment as a minimum?

Answer 24

With buy to let properties, lenders will want the rental income to be at least 125% of the mortgage repayment

Question 25

If a property is built with unusual materials is a specialist lender usually required?

Answer 25

Yes, if a property is built with unusual material a specialist lender is usually required

Question 26

Are older properties more expensive to maitain?

Answer 26

Yes, older properties are more expensive to maintain

Question 27

What is the purpose of the ‘Buildmark’ scheme

Answer 27

The ‘buildmark’ scheme insures against a builder’s fraud, insolvency and any major faults in the first 10 years

Question 28

What is the minimum claim value using the ‘buildmark’ scheme?

Answer 28

Using the Buildmark scheme, the minimum claim value for policies starting after 1st April 2019 is £1,750 with an increase each year of £50 until 2026 where the minimum will be £1,950

Question 29

On what three occasions is planning permission required?

Answer 29

Planning permission is required where:
- On a house extension (dependent on size and property type)
- When dividing houses into separate self-contained “units”
- Building a fence or gate higher than 2 meters, or any height if against any restrictions or on a listed property

Question 30

How long will it take to get a decision on a planning permission application?

Answer 30

Decisions on planning permission applications should be made within 8 weeks

Question 31

Which is the type of listed building with most importance?

Answer 31

The type of listed building with most importance is a Grade I

Question 32

What is the SDLT surcharge on second properties?

Answer 32

The SDLT surcharge on second properties ins 3% on top of the standard rates

Question 33

Is SDLT paid if a property is part of a divorce settlement?

Answer 33

If part of a divorce settlement, then there is no SDLT payable.

Question 34

What is the SDLT surcharge for non-uk residents?

Answer 34

The SDLT surcharge for non-UK residents is 2% on top of standard rates

Question 35

How much is the tax credit for interest on a buy to let?

Answer 35

On a buy to let, the tax credit for mortgage interest is 20% for all