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MCOB 7.1 Application



This chapter applies to a firm in a category listed in column (1) of the table in MCOB 7.1.2 R in accordance with column (2) of that table.


This table belongs to MCOB 7.1.1R

(1) Category of firm

(2) Applicable section

mortgage lender

whole chapter

mortgage administrator

MCOB 7.1 - MCOB 7.3.3 R and MCOB 7.5 - MCOB 7.7.

mortgage adviser and mortgage arranger

MCOB 7.1 - MCOB 7.3.3 R and MCOB 7.6.7 R - MCOB 7.7.4 R



This chapter applies if a firm:

  1. (1)

    enters into a regulated mortgage contract with a customer; or

  2. (2)

    administers a regulated mortgage contract which was entered into with a customer; or

  3. (3)

    arranges or advises on or makes a further advance or other variation to the terms of a regulated mortgage contract entered into with a customer.


This chapter applies in relation to further advances and other variations (as specified in MCOB 7.6.7 R - MCOB 7.7.4 R) regardless of whether they are variations to an existing regulated mortgage contract or are such that they involve the customer entering into a new regulated mortgage contract.


This chapter also applies in relation to regulated mortgage contracts in circumstances where the original mortgage lender has passed on ownership of the loan to a third party through securitisation. In such a case, the rules in MCOB 7.5 - MCOB 7.7.4 R will apply to the firm which administers the regulated mortgage contract.


In MCOB 7.6.7 R (Further advances), MCOB 7.6.18 R (Rate switches) and MCOB 7.6.22 R (Addition or removal of a party to the contract), if a customer submits an informal application as his first contact with a firm, the illustration required to be provided to a customer in accordance with those rules must be provided and the transaction must not proceed until the customer has made a formal application confirming that it should proceed.

MCOB 7.1.7G

Firms are reminded that in MCOB, references to "arranging" include the activities of a mortgage lender which would be arranging but for article 28A of the Regulated Activities Order (Arranging contracts to which the arranger is a party).


In relation to a regulated lifetime mortgage contract, this chapter MCOB 7 is modified by MCOB 9 (Lifetime mortgages: product disclosure).1