Mortgage Market Review Course

The Financial Service Authority (FSA), appointed the FCA, introduced the Mortgage Market Review (MMR) to reform the mortgage market. The MMR rules affect intermediaries and lenders differently.

The MMR aims to make the mortgage market more sustainable and ensure continued access to affordable mortgages while limiting high-risk lending and borrowing so the market can work better for consumers.

Our Mortgage Market Review Course explains how the FCA reformed the mortgage market with new affordability and responsible lending rules, the distinction between advice and execution-only sales and professional standards.

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Mortgage Market Review

About this Course

Available as part of our FCA Compliance Library.

Learning Objectives

This course will prepare your employees to:

  • Recognise the affordability and responsible lending rules
  • Know the procedures regarding advice versus execution-only sales
  • Understand professional standards for mortgage advisers
  • Know how to deal with High Net Worth mortgage customers and business lending

Course outline

Welcome

What is Mortgage Market Review?

- Exercise: Overall aims of MMR
- What does MMR mean for you?

Responsible lending rules

- Exercise: Stakeholder responsibilities
- The affordability rules
- Exercise: The rules on income verification for the self-employed
- Types of expenditure
- Making the right decision on expenditure
- Exercise: The relationship between expenditure & affordability
- Affordability data
- Examples of a simple affordability calculation
- Affordability data revised
- Using income multiples

Stress-testing & future-proofing

- Interest-rate stress tests
- Interest-rate issues
- Exercise: Applying the rules in practice 1
- Exercise: Applying the rules in practice 2
- What is a 'credible repayment strategy'?
- Exercise: Speculative repayment strategies
- Implementing an interest-only policy
- Exercise: Implementing an interest-only policy
- You make the call: Interest-only mortgages
- Exercise: The rules on interest-only mortgages
- Contract variations & transitional arrangements
- Exercise: Contract variations & transitional arrangements
- Checklist: Transitional arrangements
- Fair treatment of existing borrowers
- Exercise: Fair treatment of existing borrowers
- New requirements help mortgage prisoners switch mortgages
- Systems & controls

Arrears management

- Payment shortfalls
- Exercise: Setting fees
- Exercise: Concessionary rates for borrowers with payment problems
- Checklist: Payment shortfalls
- Exercise: Good & poor practice in arrears management
- Enforcement: Charges for payment shortfalls

Distribution: Advice

- Exercise: What is advice?
- Checklist: Are you giving advice?
- Information versus advice
- Exercise: Providing advice to customers
- Exercise: Lawrence's renewal

Distribution: Execution-only

- Rejecting advice
- Rules for proceeding on an execution-only basis
- Exercise: Vulnerable customers
- Contract variations
- Exercise: Abi switches products in-branch

Distribution: Professional standards

Distribution: Sales standards

- Exercise: European Standardised Information Sheet (ESIS)

Exercise: High Net Worth (HNW) mortgage customers

- Wealth & affordability
- Checklist: HNW mortgage customers

Business lending

- Exercise: Isha's business loan
- High-level approach for business lenders
- Checklist: Business lenders

Niche markets

- Bridging loans
- Exercise: The rules on bridging loans

Summary

Affirmation

Assessment

FCA Courses Library

Our FCA Course library of over 60 training modules covers everything from high-level and conduct of business standards to thematic topics, including treating customers fairly.

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Course Specifications

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Structure

Approximately 75-minute long e-learning course followed by a 10-question assessment.

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Audience

Suitable for all staff - examples and interactivities designed for staff at all levels. No previous knowledge or experience is required.

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Design

SHARD-compliant, responsive display on all devices, accessibility on screen readers, visual design controlled via a client style sheet.

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Test-Out

Ability to offer optional test-out, whereby users can choose to skip the course content and complete the learning assignment simply bypassing the assessment.

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Compatibility

All Windows, Mac OSX, iOS, Android (Flash-free for mobile compatibility). AICC and SCORM 1.2-compliant, suitable for both hosted and deployed SCORM or AICC.

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Tailoring

Fully customisable on Skillcast Portal CMS.

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Translation

Pre-translated versions not available, but all text content can be exported for translation into all languages.

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Localisation

Based on UK legislation, but suitable for global audiences upon the removal of UK-specific references and translation as necessary.