X

Sign Up

or

By signing up I agree to Property Tribes Terms and Conditions


Already a PT member? Log In

Sign Up

Sign Up With Facebook, Twitter, or Google

or


By signing up, I agree to Property Tribes Terms and Conditions


Already a PT member? Log In

Log In

or


Don't have an account? Sign Up

Forgot Password

To reset your password just enter the email address you registered with and we'll send you a link to access a new password.


Already a PT member? Log In

Don't have an account? Sign Up

  • Property-a-holics

    Could pensioners be the new banks for landlords?

    I see this a lot but the fact is solicitors aren't FCA regulated so wouldn't even be aware in all likelihood!

    That's like asking a plumber to look at your fuse board!

    There's a zillion links and pieces of regulation that covers this but start here:-

    https://www.handbook.fca.org.uk/handbook/PERG/4/4.html

    Definition of a regulated mortgage contract:-

    (a) (in relation to a contract) a contract which:
    (i) (in accordance with article 61(3) of the Regulated Activities Order) at the time it is entered into, meets the following conditions:
    (A) a lender provides credit to an individual or to trustees (the 'borrower'); and
    (B) the obligation of the borrower to repay is secured by a mortgage on land in the EEA, at least 40% of which is used, or is intended to be used, as or in connection with a dwelling by an individual who is a beneficiary of the trust, or by a person who is in relation to the borrower
    (ii) is not a home purchase plan, a limited payment second charge bridging loan, a second charge business loan, an investment property loan, an exempt consumer buy-to-let mortgage contract or a limited interest second charge credit union loan within the meaning of article 61A(1) or (2) of the Regulated Activities Order.
    (b) (in relation to a specified investment) the investment, specified in article 88 of the Regulated Activities Order, which is rights under a regulated mortgage contract within (a).
    [Note: articles 3(1)(a) and 4(2) of the MCD]


    By the way breaching this is illegal and could be punishable by a prison sentence so not to be taken lightly!

    As an aside private mortgages are very popular in the US and legal in most though not all states which is where much of the so called advice and education comes from on these but they do not have the FCA nor the same regulations as we do.

    PS I do find your last comment amusing! As a landlord gosh even a human being are you not faced with regulations every minute that prevent two adults doing business?!
    0
    0

    Lisa All comments are for education and information purposes only and do not construe as advice or a financial promotion. No liability is accepted for comments made. If you wish to receive information in an advisory capacity then please contact me about becoming a client. www.keys-mortgages.com


    Lisa,
    Thanks for taking considerable time to reply. I have read the linked reference. Glad you found my last paragraph amusing. I like to question the status quo, but I am grateful for knowledge specialists on the forum who assist in making sure we don't fall down rat holes in our endeavours.

    One of my "end game" tactics, in about 15 to 20 years, was to consider selling our (by then unencumbered) properties on a long term mortgage basis. Not a big deal since it's a long time in the future, but it's good to know that this possible approach for an inter-generational income stream would probably not be viable.

    Its a mind game. Since the age of 16, I have never trusted any higher authority, even sovereign debt (maybe especially sovereign debt) so I shy away from nearly all conventional long term plans such as regulated private pensions, bonds, shares, almost anything on paper. When I screw up in old age, I don't want to blame a faceless body or name. I only want to blame myself. And I certainly don't want to become reliant on the state.

    Though I see the sense of closely regulating property transactions as they relate to a person's home as opposed to an investment, I can't help thinking it's a bit like Tesco express stores having taken over all but the fewest corner shops. I am not so sure that is in the interests of the majority of consumers, concentrating so much power in so few hands, but we must hope and pray. I am sure our successive governments THINK that they have the health and wealth of their citizens at the forefront of their minds as they move to tighter and tighter regulation. It reminds me that we are approaching the same status as some of the socialist dictatorship countries I have lived in during my working life. Whether that's good or bad is a matter for future history to decide.
    0
    0

    Preaching to the converted ;-)
    1
    0

    Lisa All comments are for education and information purposes only and do not construe as advice or a financial promotion. No liability is accepted for comments made. If you wish to receive information in an advisory capacity then please contact me about becoming a client. www.keys-mortgages.com