Serving The Retail Customer Flashcards
What is the client information you should obtain as an advisor
Basic client details, financial situation, investment objectives, risk profile, understanding and experience
When making recommendations what must you ensure
You know your client
Recommendations match risk profile
Recommendation is the most appropriate and you explain why
Provide the level of service committed to at the initial disclosure
What should all communication be
Clear, fair and not misleading
What should the characteristics of a suitability report be
Tailored
Specific to demands and needs
Explain reasons and disadvantages of recommendation
Highlight needs not covered by recommendation
What is the main priority for financial needs
Budgeting and managing debt
What is debt consolidation
Negotiates a new loan to pay off others often with lower interest rates, however charging fees can be high
What is the transfer of property in exchange for a mortgage called
The assignment
What are the two main types of mortgage
Interest only
Capital and interest repayment
What are the different interest rate options (9)
Capped Cap and collar Discount Euro Equity linked Fixed interest Flexible reserve Offset
What are the 2 equity release schemes
Lifetime mortgage
Home reversion plans
What is a home reversion plan
Sell all or part of a home for cash lump sum, regular income or both and continue living in the home
What is a lifetime mortgage
Mortgage until you die. At which point in a roll up contract interest is repaid when house is sold or a fixed repay,net when you don’t pay interest but pay a fixed higher charge or finally a home income plan where the money you borrow buys a regular income for life
What are home purchase plans
Help to buy a home without paying interest
What are the 2 types of home purchase plan
Ijara and diminishing musharaka
What is the other name for sale and rent back
Mortgage rescue
What is the purpose of sale and rent back schemes
Allows the clearance of the mortgage but you can stay in your home
What are the risks of sake and rent back
You may have to leave when term ends
You could be evicted if breach the tenancy agreement
The property could be repossessed if the buyer falls into financial difficulty
What are the 2 types of loan
Unstructured and structured
What is an unstructured loan
You can repay the loan at any time without penalty
What is a structured loan
Fixed rate interest, high costs and penalty for repaying the loan early
What top priority protection products for most
Life insurance, health cover and pension provision
How can death benefit easily be calculated
10x salary
What is the most commonly used policy to account for INT
Whole of life policy written on a last survivor basis in trust
What are the three stages of the financial life cycle
The vulnerable years
The relaxed years
The anxious years