Topic 9 -The Role Of A Mortgage Advisor

Question 1

What is the advice process

Answer 1

Fact Find
Research
Present
Implement

Question 2

What will the fact find interview cover

Answer 2

Intentions
Incomings and outgoings
Deposit and cash
Employment
Management of finances 
Budget rates and rises
Early repayment
Term
Protection needs
Attitude to risk

Question 3

What two key factors will a fact find meeting establish?

Answer 3

Affordability

Type of mortgage

Question 4

When presenting the recommendations what should an advisor do

Answer 4

Explain the product fully in appropriate language. It is vital the client fully understands and can ask questions.

Question 5

When implementing the mortgage how does the advisor continue to liaise with the client

Answer 5

Explain any additional documents and pass documents back to the lender

Liaise either the lender to keep the customer informed about each stage of the process

Explain the offer documentation to the customer

Question 6

What four key factors does an advisor need to establish as part of ethical advice

Answer 6

Customers needs
Customers circumstances
Customers attitude to risk
Customers objectives

Question 7

What are the rules relating to fair treatment of customers

Answer 7

There are no rules but the FCA have guidelines. The responsibilities of provider and distributors for the fair treatment of customers.

Question 8

FCA principles for business 1-4

Answer 8

• Integrity: A firm must conduct its business with integrity.
• Skill, care and diligence: A firm must conduct its business with due skill, care and diligence.
• Management and control: A firm must take reasonable care to organise and control its affairs responsibly and effectively, with adequate risk management systems.
• Financial prudence: A firm must maintain adequate financial resources.

Question 9

FCA principles for business 5-7

Answer 9

• Market conduct: A firm must observe proper standards of market conduct.
• Customers’ interests: A firm must pay due regard to the interest of its customers, and treat them fairly.
• Communications with clients: 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.

Question 10

FCA Principle of business 8-11

Answer 10

• Conflicts of interest: A firm must manage conflicts of interest fairly, both between itself and its customers and between one customer and another.
• Customers: relationships of trust: A firm must take reasonable care to ensure the suitability of its advice and discretionary decisions for any customer who is entitled to rely on its judgement.
• Clients’ assets: A firm must arrange adequate protection for clients’ assets when it is responsible for them.
• Relations with regulators: A firm must deal with its regulators in an open and co-operative way, and must disclose anything of which the FCA or PRA would reasonably expect notice.