Related provisions for MCOB 5A.1.1

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MCOB 11.6.3RRP
(1) MCOB 11.6.2 R does not apply to:(a) entering into a new regulated mortgage contract or home purchase plan as a replacement for an existing regulated mortgage contract or home purchase plan between the customer and the firm (either as the original mortgage lender or home purchase provider or as the transferee of the existing contract), whether or not the new contract relates to the same property; or(b) a variation of an existing regulated mortgage contract or home purchase
MCOB 11.6.5RRP
When assessing for the purposes of MCOB 11.6.2 R whether a customer will be able to pay the sums due, a firm: (1) must not base its assessment of affordability on the equity in the property which is used as security under the regulated mortgage contract or is subject to the home purchase plan, or take account of an expected increase in property prices;[Note: article 18(3) of the MCD]3(2) must take full account of:(a) the income of the customer, net of income tax and national insurance;
MCOB 11.6.20RRP
A firm must put in place, and operate in accordance with, a written policy (which may be contained in more than one document), approved by its governing body, setting out the factors it will take into account in assessing a customer's ability to pay the sums due. The policy must address the following matters:(1) how income and expenditure is to be assessed, including (except as provided in MCOB 11.6.32R (1) and MCOB 11.6.39R (1)): (a) details of the types of income which are acceptable;
MCOB 11.6.21ARRP
3An MCD mortgage lender must keep a record of the valuation and types of immovable property accepted as a security, as well as the related mortgage underwriting policies used.[Note: article 19(2) and second sentence of article 26(1) of the MCD]
MCOB 11.6.21BGRP
3When considering the period for which the records kept under MCOB 11.6.21A R are to be retained, MCD mortgage lenders are reminded of the high-level record-keeping provisions in SYSC.
MCOB 11.6.60RRP
(1) A firm must make, in paper or electronic form, an adequate record of the steps it takes to comply with the rules in this chapter in relation to each customer.(2) The record in (1) must include the information taken into account in each affordability assessment, so that it is possible to understand from the record the basis of the mortgage lender's or home purchase provider's lending or financing decision, including (except as provided in MCOB 11.6.32R (3) and MCOB 11.6.39R
MCOB 6A.3.1RRP
(1) If a firm offers to enter into an MCD regulated mortgage contract with a consumer, it must provide the consumer with a binding offer set out in an offer document. (2) The firm may also provide an ESIS. (3) The firm's offer in the offer document must be on the basis of the information in the ESIS relevant to that offer.(4) When an MCD mortgage lender provides the consumer with a binding offer, that offer must be accompanied by an ESIS where the characteristics of the offer
MCOB 6A.3.2RRP
(1) If a firm offers to vary an MCD regulated mortgage contract with a consumer, it must provide the consumer with an offer document.(2) The firm may also provide an ESIS. (3) The firm's offer in the offer document must be on the basis of the information in the ESIS relevant to that offer. (4) When an MCD mortgage lender offers to vary an MCD regulated mortgage contract with a consumer, the offer document must be accompanied by an ESIS where:(a) the characteristics of the offer
MCOB 6A.3.3GRP
(1) MCOB 6A.3.1 R does not prevent a binding offer from being subject to lawful conditions, including conditions which make the binding offer subject to one or more of the matters listed below:(a) there being no material change to the facts and circumstances relating to the binding offer which occurs after the date on which the binding offer is made;(b) the fact that the consumer has not knowingly provided incomplete or inaccurate information for the purpose of the assessment
MCOB 6A.3.4RRP
(1) Where an MCD mortgage lender provides the consumer with a binding offer, it must give the consumer a reflection period of at least seven days.(2) The MCD mortgage lender must ensure that, during the reflection period:(a) the offer remains binding on the MCD mortgage lender;(b) the consumer may accept the offer at any time.[Note: article 14(6) of the MCD]
MCOB 6A.3.16GRP
In addition to the information required by MCOB 6A.3.9 R, a firm may include information about how to complain to any other firm about the services that firm provided to the consumer in relation to the MCD regulated mortgage contract. For example, where the consumer received advice from another firm, an MCD mortgage lender may include contact details for the firm that provided the advice.
MCOB 5A.4.1RRP
(1) A firm must provide the consumer with an ESIS for an MCD regulated mortgage contract before the consumer submits an application for that MCD regulated mortgage contract to an MCD mortgage lender, unless an ESIS for that MCD regulated mortgage contract has already been provided.(2) Except in the circumstances in MCOB 5A.4.2 R, a firm must provide the consumer with an ESIS for an MCD regulated mortgage contract when any of the following occurs, unless an ESIS for that MCD regulated
MCOB 5A.4.5GRP
The effect of MCOB 5A.2.1 R and MCOB 5A.4.1R (1) is that, if a consumer's application to enter into an MCD regulated mortgage contract with a MCD mortgage lender, made through an MCD credit intermediary, is subsequently passed by that firm to another MCD mortgage lender, then the firm must ensure that the application is amended and the consumer is provided with an ESIS for the other MCD mortgage lender'sMCD regulated mortgage contract before the application is passed to the other
MCOB 5A.4.8GRP
The effect of MCOB 5A.4.1R (1) and MCOB 5A.4.7 R is that a consumer will be deemed to be committed to an application if, for example, they pay a product-related fee (including a valuation fee) or provides electronic or verbal authority to process an application. It is not necessary for a consumer to provide an MCD mortgage lender with a completed application form to submit an application for an MCD regulated mortgage contract.
MCOB 5A.4.9RRP
The firm dealing directly with the consumer is responsible for ensuring compliance with the content and timing requirements, ie, an MCD mortgage lender is not responsible for ensuring that a consumer has received an ESIS before accepting an application from an MCD mortgage credit intermediary.
MCOB 4A.1.1RRP
An MCD mortgage arranger (unless it is also acting as3 an MCD mortgage lender and3 carrying out a3 direct sale of the proposed regulated mortgage contract3) must, in good time before carrying out any MCD mortgage credit intermediation activity, provide the consumer with at least the following information in a durable medium: (1) the identity and the geographical address of the MCD mortgage arranger2;(2) the Financial Services Register or other registers in which the MCD mortgage
MCOB 4A.1.5RRP
An MCD mortgage credit intermediary who is not a tied MCD mortgage credit intermediary (unless it is also acting as3 an MCD mortgage lender and3 carrying out a3 direct sale of the proposed regulated mortgage contract3), but who receives commission from one or more MCD mortgage lenders must, at the consumer's request, provide information on the variation in levels of commission payable by the MCD mortgage lenders providing the MCD regulated mortgage contract being offered to the
MCOB 4A.1.6RRP
An MCD mortgage credit intermediary (unless it is also acting as an MCD mortgage lender3 and carrying out a3 direct sale of the proposed regulated mortgage contract3) must inform the MCD mortgage lender of any fee payable by the consumer to the MCD mortgage credit intermediary for its services, for the purpose of calculating the APRC.[Note: article 15(4) of the MCD]
MCOB 4A.1.7RRP
An MCD mortgage credit intermediary (unless it is also acting as3 an MCD mortgage lender and carrying out a3 direct sale of the proposed regulated mortgage contract3) must require their appointed representatives to disclose to the consumer the capacity in which the appointed representative is acting and the MCD mortgage credit intermediary that the appointed representative is representing when contacting or before dealing with any consumer. [Note: article 15(5) of the MCD]
MCOB 4.4A.4RRP
(1) If a firm is not offering to the customer products from an unlimited range from across the relevant market, in2 its disclosure on product range in MCOB 4.4A.1 R, the firm must:22(a) where it is an MCD mortgage credit intermediary,2 list the names of all the mortgage lenders whose products it is offering; or(b) where it is not an MCD mortgage credit intermediary, either22(i) comply with (a); or2(ii) inform the customer of the number of mortgage lenders whose products it is
MCOB 4.4A.8RRP
(1) The information about the basis of remuneration required by MCOB 4.4A.1R (2) must include all relevant information, including the following details:(a) any fees which the firm will charge to the customer;(b) when any such fees will be payable and, if applicable, reimbursable; and(c) whether the firm will receive commission from the mortgage lender or another third party and, if applicable, whether any commission will be offset against any fees charged and the arrangements
MCOB 4.4A.9RRP
The information required by MCOB 4.4A.1 R, MCOB 4.4A.2 R, MCOB 4.4A.4R (1),2MCOB 4.4A.8 R and MCOB 4.4A.8A R2 must be communicated clearly and prominently, and in doing so:(1) an MCD mortgage adviser, or any other firm that is7 an MCD mortgage lender or an MCD mortgage arranger that provides advisory services within the meaning of article 4(21) of the MCD,7 must provide the information in MCOB 4.4A.1R(1) and (2) and MCOB 4.4A.8R(1)(a) and (2)(e)7 in a durable medium;22(a) [deleted]72(b)
MCOB 4.4A.12RRP
The information required by MCOB 4.4A.1 R, MCOB 4.4A.2 R, MCOB 4.4A.4R(1) and (3)7, MCOB 4.4A.8 R and MCOB 4.4A.8A R2 must be provided:222(1) in the case of information required by MCOB 4.4A.1R (1) and MCOB 4.4A.1R (2), MCOB 4.4A.4R (1)(a) and (3), and MCOB 4.4A.8R (1)(a), (c) ,(d) and (2), where the firm is an MCD credit intermediary, in good time before carrying out any MCD credit intermediation activity; 2(1A) in the case of information required by MCOB 4.4A.1R(1) and (2)
MCOB 4.4A.20AGRP
(1) 2An MCD mortgage lender or an MCD credit intermediary may comply with MCOB 4.4A.18R (3) and (5) to MCOB 4.4A.18R (9) by providing an ESIS to the consumer prior to the conclusion of the MCD regulated mortgage contract. (2) Provided that the provisions of MCOB 4.4A on the methods and timing of disclosure are complied with, an MCD mortgage lender or an MCD credit intermediary may comply with MCOB 4.4A.18R (1), (2) and MCOB 4.4A.18R (4) by providing the necessary information in
MCOB 2A.1.1RRP
(1) An MCD mortgage lender must not remunerate its members of staff or MCD mortgage credit intermediaries in a way that impedes the MCD mortgage lender from complying with the rules.(2) An MCD mortgage credit intermediary must not remunerate its members of staff or appointed representatives in a way that impedes the MCD mortgage credit intermediary from complying with the rules.[Note: article 7(2) of the MCD]
MCOB 2A.1.2RRP
When establishing and applying remuneration policies for members of staff who are responsible for the assessment of affordability for consumers, an MCD mortgage lender must comply with the following principles:(1) be consistent with, and promote, sound and effective risk management;(2) not encourage risk-taking that exceeds the level of tolerated risk of the MCD mortgage lender;(3) be in line with the business strategy, objectives, values and long-term interests of the MCD mortgage
MCOB 2A.1.3RRP
An MCD mortgage lender must comply with MCOB 2A.1.2 R in a way and to the extent that is appropriate to its size, internal organisation and the nature, scope and complexity of its activities:[Note: article 7(3) of the MCD]
MCOB 2A.1.4RRP
An MCD mortgage adviser, or any other firm that is an MCD mortgage lender or an MCD mortgage arranger that provides advisory services within the meaning of article 4(21) of the MCD, must ensure that the remuneration structure of the members of staff involved does not:(1) prejudice the ability of the members of staff or the firm to act in the consumer's best interest; and(2) be contingent on sales targets.[Note: article 7(4) of the MCD]
MCOB 2A.1.5GRP
The remuneration policies of MCD mortgage lenders and MCD mortgage credit intermediaries, including those that take account of sales volumes, should not be designed in a way that would incentivise their members of staff to conclude a given number or type of MCD regulated mortgage contracts.
MCOB 2A.2.1RRP
Except in the circumstances specified in MCOB 2A.2.2 G, MCOB 2A.2.3 R and MCOB 2A.2.4 R, neither an MCD mortgage lender nor an MCD mortgage credit intermediary may engage in any tying practice.[Note: article 12(1) of the MCD]
MCOB 2A.2.3RRP
An MCD mortgage lender may request the consumer, family member or close relation of the consumer to:(1) open or maintain a payment or a savings account, where the only purpose of the account is to accumulate capital to repay the credit, to service the credit, to pool resources to obtain the credit, or to provide additional security for the MCD mortgage lender in the event of default;(2) purchase or keep an investment product or a private pension product, where such product primarily
MCOB 2A.2.4RRP
An MCD mortgage lender may engage in tying practices where it can demonstrate to the FCA that the tied products or categories of product offered, on terms and conditions similar to each other, which are not made available separately, result in a clear benefit to the consumer taking due account of the availability and the prices of the relevant products offered on the market. This rule only applies to products which are marketed after 20 March 2014.[Note: article 12(3) of the
MCOB 2A.2.5RRP
An MCD mortgage lender may require the consumer to hold a relevant insurance policy related to the MCD regulated mortgage contract but, where it does so, the MCD mortgage lender must accept an insurance policy from a supplier different to his preferred supplier where such policy has a level of guarantee equivalent to the one the MCD mortgage lender has proposed.[Note: article 12(4) of the MCD]
MCOB 5A.3.1RRP
A firm that is an MCD mortgage credit intermediary must take reasonable steps to ensure that an ESIS which it issues, or which is issued on its behalf, other than that provided by an MCD mortgage lender is accurate.
MCOB 5A.3.2RRP
It is the responsibility of the firm to ensure compliance with MCOB 5A.3.1 R. However, where a firm can show that it was reasonable for it to rely on information provided by another person, other than the MCD mortgage lender, that an ESIS was accurate, it may be able to rely on MCOB 2.5.2 R, if this turns out not to be the case.
MCOB 5A.3.3RRP
A firm must not issue an ESIS to a consumer for an MCD regulated mortgage contract for which the consumer is clearly ineligible on the basis of the information that the firm has obtained from the consumer or the MCD mortgage lender's lending criteria.
PERG 4.10A.4GRP
Article 4(4B) of the Regulated Activities Order only applies if the regulated mortgage contract is covered by the MCD. A regulated mortgage contract is covered if: (1) the lender is acting in the course of his trade, business or profession; and(2) the borrower is an individual; and(3) the borrower is acting for purposes which are outside their trade, business or profession; and(4) the regulated mortgage contract does not come within one of the exclusions summarised in PERG 4.10A.5
PERG 4.10A.8GRP
Therefore, article 4(4B) means that the Regulated Activities Order exclusions in PERG 4.10A.2G (3) do not apply to entering into a regulated mortgage contract as lender unless: (1) the regulated mortgage contract falls outside the MCD (see PERG 4.10A.5 G); or(2) the lender is not acting in the course of his trade, business or profession.
MIPRU 1.3.2RRP
For the valuation of residential immovable property to enter into an MCD credit agreement:(1) an MCD creditor must use reliable standards for the valuation where the valuation is carried out by the MCD creditor; or(2) where the valuation is carried out by a third party, the MCD creditor must take reasonable steps to ensure that reliable standards are used. [Note: article 19(1) of the MCD]
MIPRU 1.3.3GRP
For the purposes of MIPRU 1.3.2 R: (1) reliable standards for the valuation of residential immovable property include internationally recognised valuation standards, in particular those developed by the International Valuation Standards Council1 (IVSC), the European Group of Valuers’ Associations (EGoVA) or the Royal Institution of Chartered Surveyors (RICS), as well as the standards in BIPRU 3.4.77 R to BIPRU 3.4.80 R or, where applicable, MIPRU 4.2F.27 R to MIPRU 4.2F.29 R.[Note:
MIPRU 1.3.4RRP
An MCD creditor must ensure that: (1) internal and external appraisers conducting property valuations are professionally competent and sufficiently independent from the credit underwriting process so they can provide an impartial and objective valuation; and(2) property valuations are documented in a durable medium. [Note: article 19(2) of the MCD]
MCOB 11A.3.1RRP
(1) An MCD mortgage lender must specify in a fair, clear and not misleading way, in good time before assessing affordability of a MCD regulated mortgage contract, to a consumer:(a) all the necessary information and independently verifiable evidence that the consumer needs to provide; and(b) the timeframe within which the consumer needs to provide the information or evidence.(2) A request for information or evidence under (1) must be proportionate and limited to what is necessary
MCOB 11A.3.2GRP
An1MCD mortgage lender must inform a consumer in advance if a database is to be consulted in conducting any assessment of affordability for an MCD regulated mortgage contract.[Note:article 18(5)(b) of the MCD]
MCOB 11A.3.3RRP
(1) Where an MCD mortgage lender rejects a consumer's application for an MCD regulated mortgage contract, the MCD mortgage lender must inform the consumer without delay:(a) of the rejection and, where applicable, that the decision is based on automated processing of data; and(b) where the rejection is based on the result of the database consultation, of the result of such consultation and of the particulars of the database consulted.[Note: article 18(5)(c) of the MCD](2) No obligation
MCOB 2A.3.1RRP
Where an MCD regulated mortgage contract relates to a foreign currency loan, at the time the MCD regulated mortgage contract is entered into the MCD mortgage lender must ensure:(1) the consumer has a right to convert the MCD regulated mortgage contract into an alternative currency under specified conditions; or(2) there are other arrangements in place to limit the exchange rate risk to which the consumer is exposed under the MCD regulated mortgage contract.[Note: article 23(1)
MIPRU 2.2.2RRP
6545[deleted]7
MIPRU 2.2.3GRP
[deleted]7
MCOB 10A.1.3RRP
The calculation of the APRC must be based on the assumption that the MCD regulated mortgage contract is to remain valid for the period agreed and that the MCD mortgage lender and the consumer will fulfil their obligations under the terms and by the dates specified in the MCD regulated mortgage contract.[Note: article 17(3) of the MCD]
MCOB 7B.1.1RRP
This chapter applies to a firm that is an MCD mortgage lender or an MCD mortgage credit intermediary.
MCOB 7B.1.2RRP
Before a consumer submits an application to a firm for a further advance on an existing or new MCD regulated mortgage contract or for a further advance that is a new MCD regulated mortgage contract, if the further advance requires the approval of the MCD mortgage lender, the firm must provide the consumer with an ESIS that complies with MCOB 5A (MCD pre-application disclosure) and MCOB 7B.1.4 R for the further advance, unless an ESIS has already been provided.
MCOB 4A.3.1RRP
An MCD mortgage adviser, or any other firm that is an MCD mortgage lender or an MCD mortgage arranger that provides advisory services within the meaning of article 4(21) of the MCD, must, for the particular transaction, explicitly inform the consumer whether advisory services are being, or can be, provided to the consumer.[Note: article 22(1) of the MCD]
MCOB 4A.3.2RRP
Where an MCD mortgage adviser, or any other firm that is an MCD mortgage lender or an MCD mortgage arranger that provides advisory services within the meaning of article 4(21) of the MCD, advises on a transaction relating to an MCD regulated mortgage contract, it must give the consumer a record on paper, or in another durable medium, of the recommendation provided.[Note: article 22(3)(e) of the MCD]
MCOB 2A.4.1RRP
(1) An MCD mortgage lender must give a consumer who enters into an MCD regulated mortgage contract the right to discharge fully or partially his obligations under that MCD regulated mortgage contract prior to its expiry.(2) If the consumer exercises the right in (1), the MCD mortgage lender must reduce the total cost of the credit to the consumer by an amount equal to the interest and costs for the remaining duration of the MCD regulated mortgage contract.[Note: article 25(1)
MCOB 2A.4.2RRP
MCOB 2A.4.1R (1) does not prevent an MCD mortgage lender from imposing an early repayment charge in accordance with MCOB 12.3.1 R.
MCOB 7.1.2ARRP
4MCOB 7.6.7 R to MCOB 7.6.17 R do not apply to a firm that is an MCD mortgage lender or MCD mortgage credit intermediary.
MCOB 7.1.2BGRP
4MCOB 7B applies to a firm that is an MCD mortgage lender or MCD mortgage credit intermediary, instead of MCOB 7.6.7 R to MCOB 7.6.17 R.