Unit 3 Topic 2&3 Flashcards
Bradley Building Society has commercial assets of £80 million. What is the
MAXIMUM it can lend to limited companies secured on land?
A £8 million
B £20 million
C £32 million
D £40 million
B £20 million
Paul took out a loan to purchase a warehouse in the UK and Henry took out a
loan to purchase a holiday home in Florida. Which transaction if either is
deemed a regulated mortgage?
A Henry’s
B Paul’s
C Both
D Neither
D Neither
Which one of the following statements is FALSE in relation to the power to
borrow?
A Attorneys can borrow on behalf of the other person if they have a current
power of attorney that includes this.
B Trustees can create a mortgage if the trust deed permits it.
C An executor named in a will can create a mortgage if it is for the purpose of
administering the estate.
D A personal representative appointed by letters of administration has no
powers to create a mortgage.
D A personal representative appointed by letters of administration has no
powers to create a mortgage.
Henry has discovered he is unable to enter into a contract to buy Jenny’s house.
This is because:
A Henry has not yet appointed a solicitor.
B Henry is only 20, although he has funds for the deposit.
C Jenny is selling on behalf of her mother who is out of the country and not aware of Jenny’s intentions.
D Jenny suffers from minor depression for which she receives medication so
she can continue working
C Jenny is selling on behalf of her mother who is out of the country and not aware of Jenny’s intentions.
A person of unsound mind who requires housing funded by a mortgage:
A should appoint a specific power of attorney to another individual.
B needs to appoint an enduring power of attorney to another individual.
C is able to borrow in his or her own right.
D must be represented by a person appointed by the Court of Protection.
D must be represented by a person appointed by the Court of Protection.
A person who is given a legal responsibility to act on behalf of another while the latter is living abroad is known as: A A personal representative B an attorney C an administrator D A trustee
B an attorney
Who of the following is legally able to take out a mortgage to buy a new property?
A Sue, whose power of attorney has just been appointed to the Court of Protection.
B Diane, who became a discharged bankrupt 6 months ago.
C Jennie, whose bankruptcy order came into force 8 months ago.
D Maria, who is 17 years of age and about to marry with her parents’ consent.
B Diane, who became a discharged bankrupt 6 months ago.
Which of the following statements is true?
A Trustees have automatic borrowing powers, irrespective of the contents of the
trust deed.
B Trustees can borrow unless the trust deed specifically prevents it.
C Trustees can only borrow if the loan is for dealing with probate matters.
D Trustees can only borrow if they are specifically empowered to do so by the
trust deed.
D Trustees can only borrow if they are specifically empowered to do so by the
trust deed.
Which one of the following is true in relation to lending to limited companies?
A Building societies can secure up to 75% of commercial assets on loans
secured on land.
B The security offered must be a commercial property.
C Loans to limited companies represent potentially higher margins and lower
risk.
D To establish whether it is legally entitled to borrow, a lender should examine
the memorandum and articles of association
D To establish whether it is legally entitled to borrow, a lender should examine
the memorandum and articles of association
Which one of the following would be able personally to take out a mortgage?
A Chris, whose bankruptcy order was confirmed four months ago.
B Dave, whose Individual Voluntary Arrangement was confirmed last month.
C Edith, who is 80, and is the subject of an enduring power of attorney, given to
her daughter.
D Lucy, who is 17, working and has inherited £50,000 from her grandfather to
use as a deposit.
B Dave, whose Individual Voluntary Arrangement was confirmed last month.
Which of these mortgages below is most likely to be regulated under the
Mortgage Credit Directive (MCD)?
A A remortgage taken out by John to let out a property he has inherited following the death of his mother.
B A mortgage for ABC Ltd to buy a residential property.
C A mortgage taken by Pat to buy a warehouse in an industrial estate.
D A mortgage taken by Paul to buy a villa in the USA.
A A remortgage taken out by John to let out a property he has inherited following the death of his mother.
Under the FCA regulations, the definition of a regulated mortgage specifically EXCLUDES: A debt consolidation. B home improvement lending. C corporate mortgages. D bridging loans.
C corporate mortgages.
Arnold is considering arranging a lasting power of attorney (LPA).
Which of the following is FALSE?
A Arnold can continuously make decisions once a property and financial affairs LPA
has been registered as long as he is mentally capable.
B Once a health and welfare LPA is registered, Arnold and his attorney have joint decision making powers until Arnold loses mental capacity.
C Arnold can register a property and financial affairs LPA at any time once it has been set up.
D Under a health and welfare LPA, Arnold’s attorney will only have powers once
Arnold has lost his mental capacity.
B Once a health and welfare LPA is registered, Arnold and his attorney have joint decision making powers until Arnold loses mental capacity.
George and Margaret own a three bedroom cottage in Devon that forms
the basis of their thriving holiday rental business. They are now looking to
arrange an interest only re-mortgage in order to improve the property. The
mortgage is likely to be regarded as a:
A second charge mortgage
B consumer buy-to-let mortgage.
C regulated mortgage.
D business buy to let mortgage
D business buy to let mortgage
Tomas took out his existing mortgage in 2012 and now wants to switch his
mortgage to another deal with his current lender. He feels he will have difficulty
due to the changes in the lender’s affordability since 2014. He would normally be
classified as a:
A credit-impaired customer.
B vulnerable customer
C sub-prime customer
D mortgage prisoner
D mortgage prisoner
