Related provisions for MCOB 9.7.9
1 - 20 of 148 items.
(1) Further requirements regarding the use of the Key facts logo and the location of specimens are set out in GEN 5.1 and GEN 5 Annex 1 G.33(2) MCOB 5.6.2 R(3) does not prevent the use of different fonts and typefaces for headings and risk warnings. Its purpose is to prevent particular sections of the illustration from being made less prominent than other sections through the inconsistent use of font sizes and typefaces.(3) The illustration can contain the mortgage lender's or
Where the illustration relates to a regulated mortgage contract that is sub-divided into different parts with different types of interest rate or different rates of interest or different conditions, or a combination of these, the requirements in MCOB 5.6 may be adapted to accommodate this. The adaptations made must be limited to those that are necessary.
(1) MCOB 5.6.13 R applies where, for example, the illustration covers a regulated mortgage contract that is:(a) divided so that a certain amount of the loan is payable on a fixed interest rate, and a certain amount on a discounted interest rate; or(b) a combination of a repayment mortgage and an interest-only mortgage and the loan is subdivided into different types of interest rate and/or different rates of interest.(2) MCOB 5.6.13 R does not apply where an illustration covers
At the head of the illustration, the following information must be included:(1) the customer's name;(2) the date of issue of the illustration;(3) details of how long the illustration is valid and whether there is any date by which the regulated mortgage contract covered by the illustration needs to commence (for example, where a fixed interest rate is only available if the regulated mortgage contract commences before a certain date); and(4) the prescribed text at the head of the
(1) Unless (2) applies, under the section heading 'Which service are we providing you with?' the prescribed text in MCOB 5 Annex 1 under this heading must be included, with a 'check box' for each statement, one of which must be marked prominently to indicate the level of service provided to the customer.(2) If the level of service described in the illustration is provided by another firm, (1) may be replaced by the following:Under the section heading 'Which service are we providing
(1) Under the section heading 'What you have told us', the illustration must state the information that has been obtained from the customer under MCOB 5.6.6 R (apart from MCOB 5.6.6 R(1) which is provided for in Section 4 of the illustration), and can include brief details of any other information that has been obtained from the customer and used to produce the illustration.(2) If the amount on which the illustration is based includes the amount that the customer wants to borrow
Where the same illustration covers a regulated mortgage contract that is a combination of a repayment mortgage and an interest-only mortgage, either:(1) Section 3 of the illustration must state the amount the customer wishes to borrow as a repayment mortgage and the amount required as an interest-only mortgage; or(2) Section 3 of the illustration must summarise the repayment method as partly an interest-only mortgage and partly a repayment mortgage, and Section 4 of the illustration
Where the same illustration covers a regulated mortgage contract that has different parts of the loan over a different term (that is, the final repayment date of the loan parts are different), either:(1) Section 3 of the illustration must state the amount repayable over each term; or(2) Section 3 of the illustration must state the longest term that applies and Section 4 of the illustration must state the amount repayable over each term.
For the purpose of illustrating to the customer the repayment method in Section 3 or Section 4 of the illustration, or the cost of the regulated mortgage contract in Section 5 of the illustration, if the illustration covers a regulated mortgage contract that is a combination of more than one interest-only part on the same product terms but with different repayment dates, the illustration must either treat it as one part by assuming the longest term, or alternatively treat it as
At the end of Section 3 of the illustration a statement must be included making clear that changes to any of the information obtained from the customer, and where appropriate to the valuation of the property, could alter the details elsewhere in the illustration, and encouraging the customer to ask for a revised illustration in this event.
Description of interest rate types and rates of interest. This table belongs to MCOB 5.6.26R:
Description of the interest rate |
Amount payable in each instalment |
Lender's base mortgage rate - must be described as the [Lender]'s standard variable rate, currently X%, [where applicable insert the date at which the interest rate ends or period for which the interest rate applies]. |
Amount based on X%. |
Fixed rate - must be described as a fixed rate of X% [where applicable insert the date at which the interest rate ends or the period for which the interest rate applies]. |
Amount based on the fixed rate of X%. |
Discounted rate - must be described as a variable rate, currently X%, with a discount of Y% [where applicable insert the date at which the discount ends or the period for which the discount applies], giving a current rate payable of Z%. |
Amount based on Z%. |
Capped rate - must be described as a variable rate, currently X%, which will not go above a ceiling of Y% [where applicable insert the date at which the capped interest rate ends or the period for which the capped interest rate applies]. |
Amount based on the current interest rate payable (X%). |
Capped and collared - must be described as a variable rate, currently X%, which will not go below a floor of Y%, or above a ceiling of Z% [where applicable insert the date at which the capped and collared interest rate ends or the period for which the capped and collared interest rate applies]. |
Amount based on the current interest rate payable (X%). |
Tracker rate - must be described as a variable rate which is [X% above/X% below/the same as] [insert interest rate tracked, currently Z%,] [where applicable insert the date at which the rate ends or the period for which the interest rate applies], to give a current rate payable of Y%. Details should also be provided of how soon after an interest rate change the mortgage interest rate is adjusted. |
Amount based on Y%. |
Deferred rate - must be described as a variable rate, currently X%, where Y% is not paid now but is added to your mortgage [where applicable insert the date at which the deferred interest rate ends or the period for which the deferred interest rate applies], to give a current rate payable of Z%. |
Amount based on Z%. |
Stepped rate where different interest rates apply over different time periods (for example, fixed interest rate in year 1 changes in year 2). Each element should be dealt with individually as above. |
Amount for each of the 'steps'. |
Combinations of the above must be treated in the same way as the descriptions above, (for example, if a discounted interest rate has a 'floor' then it must be described as such). |
Follow the above treatment depending on the combination. |
Where the loan under the regulated mortgage contract is divided into more than one part (for example where part of the loan is a fixed interest rate and part of the loan is a discounted variable interest rate) and the firm displays this in a tabular format in the illustration:(1) the following text must be used to introduce the table 'As this mortgage is made up of more than one part, these parts are summarised below:';(2) each part must be numbered for ease of reference in the
Under the section heading 'Overall cost of this mortgage' where the regulated mortgage contract has an agreed term for repayment and a regular payment plan (that is, it is not a revolving credit agreement such as a secured overdraft or mortgage credit card, or a regulated mortgage contract where all of the interest rolls up, such as an open-ended bridging loan9):9(1) the following text must be included in the illustration: 'The overall cost takes into account the payments in Sections
Under the section heading 'Overall cost of this mortgage' where the regulated mortgage contract has no agreed term for repayment, (and a 12 month term has been assumed), or no regular payment plan, or both (for example, a revolving credit agreement such as a secured overdraft or mortgage credit card or a regulated mortgage contract where all the interest rolls up such as an open-ended bridging loan9):9(1) the following text must be included in the illustration: 'The overall cost
MCOB 5.6.31 R(5) and MCOB 5.6.32 R(5) would require, for example, a reference to the fact that the overall cost takes into account mortgage payment protection insurance where this is required as a condition of the regulated mortgage contract to which the illustration relates. The requirement to take out such insurance must be stated in Sections 4 and 9 of the illustration in accordance with MCOB 5.6.25 R(6), MCOB 5.6.74 R or MCOB 5.6.77 R.
The following text must be included after the text required by MCOB 5.6.31 R or MCOB 5.6.32 R with the relevant cost measures shown in the right-hand column of Section 5 in accordance with the layout shown in MCOB 5 Annex 1:(1) 'The total amount you must pay back, including the amount borrowed is £[insert total amount payable]';(2) 'This means you pay back £[insert the total amount payable] divided by the amount on which the illustration is based from MCOB 5.6.6 R(2) plus all
(1) The APR and the total amount payable in MCOB 5.6.34 R must be calculated on the basis of information obtained from the customer under MCOB 5.6.6 R.(2) Where there is a charge to be included in the APR and total amount payable and the precise amount of that charge is not known at the time that the illustration is provided, MCOB 10.3 (Formula for calculating the APR) sets out a number of relevant assumptions to be used. If the method for including the charge is not addressed
At the end of Section 5 of the illustration the following text must be included:(1) unless the interest rate is fixed throughout the term of the regulated mortgage contract:'The figures in this section will vary following interest rate changes and if you do not keep the mortgage for [insert term from MCOB 5.6.6 R(4)].'; and(2) (a) where the regulated mortgage contract is a repayment mortgage:'Only use the figures in this section to compare the cost with another repayment mortgage.';
The purpose of the illustration is to provide the customer with details of the cost of borrowing the amount required over the term specified from MCOB 5.6.6 R(2) and MCOB 5.6.6 R(4). Section 12 has been designed specifically to allow examples of the effect of any additional features of the regulated mortgage contract such as a linked current account or a linked savings account. Examples of these features should therefore be shown in Section 12 and not in Section 5 or Section 6
The heading for Section 6 of the illustration and the heading of the column on the right-hand side of this section must state the frequency with which payments must be made by the customer. (For example, if payments are to be made on a monthly basis, the heading for this section must be 'What you will need to pay each month' and the column must be headed 'Monthly payments'.)
Section 6 of the illustration must contain the following information: (1) the loan amount on which the illustration is based. This figure should include all fees, charges and insurance premiums that have been added to the loan in accordance with MCOB 5.6.18 R(2) and MCOB 5.6.18 R(3), and the following text must follow the loan amount:'and include[s] the [fees] [and] [insurance premiums] that are shown in [Section 8] [and] [Section 9] as being added to your mortgage.'(2) the assumed
Where the illustration covers a regulated mortgage contract that is a combination of a repayment mortgage and an interest-only mortgage, the payment amounts in MCOB 5.6.42 R(3)(d) must be the combination of the amount to be paid on the repayment mortgage and the amount to be paid on the interest-only mortgage, unless MCOB 5.6.13 R or MCOB 5.6.54 R apply in which case they must be stated separately.
Where the interest is deferred on the regulated mortgage contract, the following text must be included under the information on the deferred interest rate included in the illustration in accordance with MCOB 5.6.42 R(3):'"The interest deferred will be added to your mortgage. The table at Section [insert 6a or 6b if MCOB 5.6.55 R applies] of this illustration shows how this will affect the amount you owe.'
Where MCOB 5.6.55 R applies and part of the regulated mortgage contract is an interest-only mortgage:(1) if a quotation for the repayment strategy9has been included in the illustration in accordance with MCOB 5.6.52 R(3) then MCOB 5.6.52 R(5) does not apply.9(2) a statement is required to indicate that these payments do not include the cost of any savings plan.
Under the section heading 'Are you comfortable with the risks?':(1) under the sub-heading 'What if interest rates go up?' the illustration must include the following:(a) if the interest rate is fixed throughout the term of the regulated mortgage contract, an explanation that the payments will not vary because the interest rate is fixed;(b) if the interest rate is fixed for part of the term of the regulated mortgage contract, an explanation of when or how increases in the interest
The amount by which the customer's payments would increase in accordance with MCOB 5.6.59 R(1)(g) and (h) must be calculated as follows:(1) the firm must use the total amount borrowed, or assume that all payments due on the regulated mortgage contract have actually been paid, all additional fees and payments due have been paid, and no underpayments or overpayments have been made;(2) where all or part of the regulated mortgage contract is a repayment mortgage, the calculation must
Under the section heading 'What fees must you pay?' the illustration must:(1) itemise all the fees that are included in the calculation of the APR in accordance with MCOB 10 (Annual Percentage Rate), excluding any charges for insurance set out in Section 9 in accordance with MCOB 5.6.73 R; and1(2) include a statement at the end of the section using the following text:'You may have to pay other taxes or costs in addition to any fees shown here.'
An example of a fee that would normally be included in Section 8 would be a fee to re-inspect a property after completion of works if it is known that this fee will be charged at the time the illustration is produced. An example of a fee that would not be included would be a fee payable by the customer to insure their property elsewhere (however this would need to be stated in Section 9 of the illustration 'Insurance', as required by MCOB 5.6.77 R(2)). Fees payable upon repayment
The following information must be provided for each fee included in this section of the illustration in accordance with MCOB 5.6.66 R(1):(1) a description of the fee;(2) the amount payable by the customer recorded in a column headed 'Fee amount' on the right-hand side of this section;(3) for fees included under the sub-heading 'Other fees', to whom the fee is payable;(4) when the fee is payable;(5) whether or not the fee is refundable, and if so, the extent to which it is refundable;
(1) If a higher lending charge is payable by the customer, the following text must be used to describe such a charge for the purposes of MCOB 5.6.69 R:'A higher lending charge is payable because you are borrowing [insert the ratio of the mortgage amount (from MCOB 5.6.6 R(2)) to the property's price or value (from MCOB 5.6.6 R(3))] of the property's [estimated] [price/value].'(2) If the customer has asked for any fees to be added to the loan, this must be stated alongside each
(1) Under the section heading 'Insurance' the illustration must include details of:(a) insurance which is a tied product; and(b) insurance which is required as a condition of the regulated mortgage contract which is not a tied product.(2) A firm may also provide details of insurance which it is optional for the customer to take out under this section heading.(3) It must be clear to the customer which products he is required to purchase under which circumstances (for example, where
The following information must be included under the sub-heading 'Insurance you must take out as a condition of this mortgage but that you do not have to take out through [insert the name of the mortgage lender, or where relevant the name of the mortgage intermediary, or both]':(1) if the regulated mortgage contract requires the customer to take out an insurance policy (other than that which is a tied product which the customer is obliged to purchase through the mortgage lender,
Under the sub-heading 'Insurance you must take out as a condition of this mortgage but that you do not have to take out through [insert name of mortgage lender or where relevant the name of the mortgage intermediary, or both]' the illustration should not include any insurance policy that may be taken out by a mortgage lender itself to protect its own interests rather than the customer's interests, for example, because of the ratio of the loan amount to the property value.1
If the cost of any insurance that the mortgage lender might take out to protect its own interests, because of the ratio of the loan amount to the property value, is passed on to the customer, it will be shown elsewhere in the illustration, for example, as a higher lending charge or in the interest rate charged.
A firm may include in the illustration, under the sub-heading 'Optional insurance', quotations (estimated where necessary) for any insurance products (other than the insurance products covered elsewhere in the illustration in accordance with MCOB 5.6.74 R and MCOB 5.6.77 R) that the firm issuing the illustration wishes to promote to the customer.
(1) If any quotations for insurance are included in the illustration in accordance with MCOB 5.6.74 R(3), MCOB 5.6.77 R(1) or MCOB 5.6.80 R, the illustration:(a) must include a brief description only of the type of insurance (full details of the insurance cover may however be provided separately); and(b) (i) must include the total price to be paid by the customer in a column on the right hand side of the illustration under the heading '[insert frequency of payments quoted] payments';
Under the heading 'What happens if you do not want this mortgage any more?', the illustration must include the following information on the regulated mortgage contract:(1) under the sub-heading 'Early repayment charges':(a) an explanation that the customer cannot repay the regulated mortgage contract early, if this is the case;(b) an explanation of whether early repayment charges are payable;(c) an explanation of when early repayment charges are payable;(d) an explanation of any
Where MCOB 5.6.84 R(1)(f) would result in more than three cash amounts being shown in the illustration, the cash amounts shown in the illustration may be restricted to three examples. These examples must be representative of the full range of charges that apply and not be limited to the lowest charges that apply. These three examples are in addition to:(1) any statement of the amount of any fees described in MCOB 5.6.84 R(1)(d); and(2) the maximum early repayment charge required
(1) In calculating example cash amounts in accordance with MCOB 5.6.84 R(1)(f), it must be assumed that:(a) the regulated mortgage contract is repaid in full;(b) unless the original amount borrowed is used, that all payments due on the regulated mortgage contract are actually paid;(c) additional fees and charges such as insurance premiums have been paid; and(d) no underpayments or overpayments have been made.(2) If:(a) cashbacks or other incentives need to be repaid; or(b) fees
Where the cash examples from MCOB 5.6.88 R included in the illustration would vary either if the interest rate charged on the regulated mortgage contract changed or with changes in interest rates generally, an appropriate warning that the early repayment charges may vary from the cash examples must be included in the illustration.
(1) Under the section heading 'What happens if you want to make overpayments?', the illustration must include details of any restrictions on lump sum and regular overpayments on the regulated mortgage contract, together with a statement as to whether or not the amount on which the interest charged is recalculated is reduced immediately on receipt of any lump sum or regular overpayment.(2) Where such recalculation does not take place immediately (for example, if an annual rest
Under the sub-heading 'Additional borrowing available without further approval', the illustration must provide details of circumstances in which there are any linked borrowing facilities that would allow the customer to increase the amount of the loan on which the illustration is based without any further approval from the mortgage lender (for example, if there are additional drawdown facilities).
Under the sub-heading 'Credit card', the illustration must:(1) state if a credit card is offered with the regulated mortgage contract; and(2) if a credit card is offered and it is a mortgage credit card:(a) unless (b) applies, include the following text:'This card will not give you a number of the statutory rights associated with traditional credit cards. Your mortgage offer will tell you more about the differences.'; or(b) where the mortgage lender provides the customer with
Where any of the additional features under MCOB 5.6.99 R to MCOB 5.6.102 R inclusive apply, then the following must also be stated if the amount of additional borrowing that would be available to the customer is stated in the illustration:(1) the maximum additional amount available;(2) if the interest rate payable on any additional borrowing is different to the interest rate in Section 4 and Section 6 of the illustration, the interest rate and the APR charged on the additional
(1) Where additional features are included in accordance with MCOB 5.6.92 R and these are credit facilities that do not meet the definition of a regulated mortgage contract or a regulated credit agreement10, the relevant parts of Section 12 of the illustration must include the following text:'This additional feature is not regulated by the FCA'.1(2) Where additional features are included in accordance with MCOB 5.6.92 R and these are credit facilities that meet the definition
(1) Under the sub-heading 'Linked savings account', the illustration must include the following information:(a) whether a linked savings account is a compulsory or optional product (if the savings account is a compulsory product this must also be stated in Section 4 of the illustration in accordance with MCOB 5.6.25 R(6));(b) the interest rate paid on the linked savings account if it differs from the interest rate charged on the regulated mortgage contract; and(c) the firm providing
If an example is included in the illustration in accordance with MCOB 5.6.109 R(2) or MCOB 5.6.110 R(2), it must be based on information obtained from the customer and the amounts that are intended to be paid into the current or savings account on a regular basis; the amounts that it is intended are saved; and the actual or likely expenditure profile. The amounts involved and the expenditure profile should not be standard assumptions made by the firm, but should be those of the
Where the illustration is issued to a customer by, or on behalf of, a mortgage intermediary, Section 13 'Using a mortgage intermediary' must be included in the illustration and must include the following:(1) unless MCOB 5.6.114 R applies, a clear statement of the amount payable (either directly or indirectly) by the mortgage lender to the mortgage intermediary, or to any third parties; and(2) the name of the mortgage lender who will make the payment, the name of the mortgage intermediary
MCOB 2.3.7 R requires any material inducements provided by a mortgage lender, whether directly or indirectly, to a mortgage intermediary or third party (unless the payment only reflects the cost of outsourcing work relating to the processing of mortgage applications by a firm unconnected to the mortgage intermediary) to be quantified in cash terms, which will enable the cash values to be included in the illustration in accordance with MCOB 5.6.117 R.1
4(1) 4The following words must be prominently displayed in the illustration, after the contact details: 'Your home may be repossessed if you do not keep up repayments on your mortgage'.(2) If the loan may be secured on property which is not the customer's home the statement in (1) may be amended but only to the extent necessary in order to reflect that fact.4
(1) An amortisation table may be added to the end of the illustration after the information required by MCOB 5.6.124 R if the mortgage lender or mortgage intermediary wishes. A firm may find that this is particularly appropriate to illustrate certain types of regulated mortgage contract, for example, a regulated mortgage contract with more than one part.(2) The purpose of (1) is to permit a firm to add an amortisation table in accordance with the European Commission's 'Recommendation
If the customer's liability under a regulated mortgage contract is in a currency other than sterling, MCOB 5.6 applies to the illustration for that regulated mortgage contract with the following amendments:(1) all cash amounts must be given in the relevant currency except where otherwise required in (2)(a) and (3);(2) the following information must be stated under Section 4 'Description of this mortgage':(a) the amount in sterling on which the illustration is based from MCOB 5.6.6
If the interest rate charged on the regulated mortgage contract is deferred, MCOB 5.6 applies with the following additions:(1) A section headed: 'Effect of deferring interest on the amount you owe' must be included in the illustration after Section 6.(2) This section must be numbered 6a so that the numbering follows on consecutively from the preceding section unless MCOB 5.6.55 R applies in which case it should be numbered 6b.(3) Under the section heading the following text must
The heading for Section 6 of the illustration and the heading of the column on the right-hand side of this section must state the frequency with which payments must be made by the customer. (For example, if payments were to be made on a monthly basis, the heading for this section would be 'What you will need to pay each month' and the column would be headed 'Monthly payments'). Where no regular payments are required on the regulated mortgage contract, for example where all interest
All the payments in Section 6 of the illustration must be calculated based on the frequency used for the purposes of the headings in MCOB 5.6.40 R and must be shown in the column on the right-hand side of this section. If no payments are required, for example on a bridging loan9 or secured overdraft, then this column should be marked on the illustration as nil.9
Section 6 of the illustration must contain the following information:(1) the loan amount on which the illustration is based. Where fees are being added to the loan then this figure should include all fees, charges and insurance premiums that have been added to the loan in accordance with MCOB 5.6.18 R(2) and MCOB 5.6.18 R(3), and the following text must follow the loan amount:'and include[s] the fees [and insurance premiums] that are shown in Section 8 [and Section 9] as being
The amount by which the total amount payable would increase in accordance with MCOB 5.6.140 R(1)(e) must be calculated as follows:(1) unless the total amount borrowed is used, it must be assumed that all payments due on the regulated mortgage contract have actually been paid, all additional fees and payments due have been paid, and no under or overpayments have been made;(2) unless the total amount borrowed is used, the calculation must be based on the amount of the loan outstanding
Unless all of the interest rates described in MCOB 9.4.47 R(4) apply for the life of the loan part to which they apply, then an additional sub section titled "What you will owe in future" must be included to indicate the future stepped payments. This section must:(1) state when a change in payment will occur;(2) state the reason for the change in payment; and(3) confirm that the payment illustrated assumes that interest rates will not change.
An explanation of the table required in accordance with MCOB 9.4.51 R must be shown in a box immediately under the heading using the following text:"This shows how the amount(s) paid to you and the interest and any fees that we charge mount up over [insert number of years estimated in accordance with MCOB 9.4.10 R or MCOB 9.4.12 R] years. It has been calculated using the current interest rate(s) of [insert interest rate(s)]. Interest is added to the amount you owe [insert frequency
Under the sub-heading 'Insurance you must take out through [insert name of mortgage lender or where relevant the name of the mortgage intermediary, or both]' the following information must be included if the lifetime mortgage7 requires the customer to take out insurance that is a tied product either through the mortgage lender or where relevant the mortgage intermediary:7(1) details of which insurance is a tied product;(2) for how long the customer is obliged to purchase the insurance;(3)
Under the heading "What happens if you do not want this mortgage any more?", the illustration must include the following information on the lifetime mortgage:77(1) under the sub-heading "Early repayment charges":(a) an explanation of whether early repayment charges are payable;(b) an explanation of when early repayment charges are payable;(c) an explanation of any other fees that are payable if the lifetime mortgage7 is repaid early, and the current level of these fees;7(d) a
Where MCOB 9.4.83 R(1)(e) would result in more than three cash amounts being shown in the illustration, the cash amounts shown in the illustration may be restricted to three examples. These three examples are in addition to the maximum early repayment charge required by MCOB 9.4.83 R(1)(f). These examples must be representative of the full range of charges that apply and not be limited to the lowest charges that apply. These three examples are in addition to:(1) any statement
(1) In calculating example cash amounts in accordance with MCOB 9.4.83 R(1)(e), it must be assumed that:(a) the lifetime mortgage7 is repaid in full;7(b) all payments due (if applicable) on the lifetime mortgage7 are actually paid;7(c) additional fees and charges such as insurance premiums have been paid; and(d) no underpayments or overpayments (if applicable) have been made.(2) If:(a) cashbacks or other incentives need to be repaid; or(b) fees need to be paid;the amounts that
Where the cash examples from MCOB 9.4.88 R included in the illustration would vary either if the interest rate charged on the lifetime mortgage7 changed or with changes in interest rates generally, an appropriate warning that the early repayment charges may vary from the cash examples must be included in the illustration.7
Under the section heading "Additional features" the illustration must include, where relevant, details of how the mortgage lender would treat any payments by the customer in excess of those required, and details of any additional features or facilities under the various sub-headings in MCOB 9.4.93 R.
(1) If none of the features at MCOB 9.4.93 R are applicable to the lifetime mortgage7 to which the illustration relates, the section headed 'Additional features' must be retained, but the sub-headings must not be included and a statement must be added to explain that there are no additional features.7(2) Only those features available on the lifetime mortgage7 need be included in the illustration.7(3) If a firm provides a customer with supplementary information about any additional
The relevant sub-headings are as follows:(1) "Overpayments"(2) "Underpayments"(3) "Payment holidays"(4) "Borrow back"(5) "Additional borrowing available without further approval"(6) "Additional secured borrowing"(7) "Credit card"(8) "Unsecured borrowing"(9) "Linked current account" and(10) "Linked savings account".
(1) Under the sub-heading 'Overpayments', the illustration must include details of any restrictions on lump sum and regular overpayments (if payments are required) on thelifetime mortgage,7 together with a statement as to whether or not the amount on which the interest is recalculated is reduced immediately on receipt of any lump sum or regular overpayment.7(2) Where such recalculation does not take place immediately (for example, if an annual rest method is used), this statement
Under the sub-heading "Additional borrowing available without further approval", the illustration must provide details of circumstances in which additional secured lending is offered with the lifetime mortgage7 that would allow the customer, subject to certain conditions, to increase the amount of the loan on which the illustration is based.7
Under the sub-heading "Additional secured borrowing", the illustration must provide details of circumstances in which additional secured lending is offered with the lifetime mortgage7 that would allow the customer, subject to certain conditions, to increase the amount of the loan on which the illustration is based.7
Under the sub-heading "Credit card", the illustration must:(1) state whether a credit card is offered with thelifetime mortgage;7 and7(2) if a credit card is offered and it is a mortgage credit card:(a) unless (b) applies, include the following text:"This card will not give you a number of the statutory rights associated with traditional credit cards. Your lifetime mortgage offer will tell you more about the differences." or(b) where the mortgage lender provides the customer with
Where any of the additional features under MCOB 9.4.99 R to MCOB 9.4.102 R inclusive apply, then the following must also be stated if the amount of additional borrowing that would be available to the customer is stated in the illustration:(1) the maximum additional amount available;(2) if the interest rate payable on any additional borrowing is different to the interest rate in Section 5 and Section 8 of the illustration, the interest rate and the APR charged on the additional
The purpose of MCOB 9.4.104 R is to show the total amount of any additional borrowing facilities that would be available to the customer and the cost of utilising these facilities. It must combine the amount available under any linked borrowing facilities including additional secured lending, credit cards and unsecured lending.
(1) Where additional features are included in accordance with MCOB 9.4.91 R and these are credit facilities that do not meet the definition of a regulated mortgage contract or a regulated credit agreement9, the relevant parts of Section 14 of the illustration must include the following text:"This additional feature is not regulated by the FCA."1(2) Where additional features are included in accordance with MCOB 9.4.91 R and these are credit facilities that meet the definition of
Under the sub-heading "Linked current account" the illustration must include the following information:(1) whether a linked current account is a compulsory or optional product (if the current account is a compulsory product this must also be stated in Section 5 of the illustration in accordance with MCOB 9.4.24 R(7));(2) an explanation of the interest rates that apply under different circumstances to the linked current account, if different from the interest rate charged on the
Under the sub-heading "Linked savings account" the illustration must include the following information:(1) whether a linked savings account is a compulsory or optional product (if the savings account is a compulsory product this must also be stated in Section 5 of the illustration in accordance with MCOB 9.4.24 R(7));(2) the interest rate paid on the linked savings account if it differs from the interest rate charged on thelifetime mortgage;7 and7(3) the firm providing the linked
Under the section heading "Overall cost of this mortgage":(1) the following text must be included in the illustration:"The APR helps you to compare lifetime mortgages by giving you one rate that shows the overall cost of the mortgage. It takes into account some fees and charges as well as the interest due, and this means that the APR may be higher than the interest rate shown in Sections 5 and 8. Only use the APR to compare lifetime mortgages of the same type, and where the same
MCOB 9.4.111 R(3) would require, for example, a reference to the fact that the overall cost takes into account mortgage payment protection insurance where this is required as a condition of the lifetime mortgage7 to which the illustration relates. The requirement to take out such insurance must be stated in Sections 5 and 12 of the illustration in accordance with MCOB 9.4.24 R(7), MCOB 9.4.72 R or MCOB 9.4.76 R.7
The following text must be included after the text required by MCOB 9.4.111 R with the relevant cost measures shown in the right-hand column of Section 15 in accordance with the layout shown in MCOB 9 Annex 1:(1) "The total amount you would pay back over the example term of [insert number of years in accordance with MCOB 9.4.10 R or MCOB 9.4.12 R] including the amount borrowed is £ [insert total amount payable]", and(2) "The overall cost for comparison is [insert the APR]% AP
Where the illustration is issued to a customer by, or on behalf of, a mortgage intermediary, Section 16 "Using a mortgage intermediary" must be included in the illustration and must include the following:(1) unless MCOB 9.4.120 R applies, a clear statement of the amount payable (either directly or indirectly) by the mortgage lender to the mortgage intermediary, or to any third parties; and(2) the name of the mortgage lender who will make the payment, the name of the mortgage intermediary
MCOB 2.3.7 R requires any material inducements provided by a mortgage lender, whether directly or indirectly, to a mortgage intermediary or third party (unless the payment only reflects the cost of outsourcing work relating to the processing of mortgage applications by a firm unconnected to the mortgage intermediary) to be quantified in cash terms, which will enable the cash values to be included in the illustration in accordance with MCOB 9.4.123 R.1
If the customer's liability under a lifetime mortgage7 is in a currency other than sterling, MCOB 9.4 applies to the illustration for that lifetime mortgage7 with the following modifications:77(1) all cash amounts must be given in the relevant currency except where otherwise required by (2)(a) and (3);(2) the following information must be stated under Section 5 "Description of this mortgage"(a) the amount in sterling on which the illustration is based from MCOB 9.4.13 R based
If the lifetime mortgage7 is a shared appreciation mortgage, MCOB 9.4 applies to the illustration with the following modifications:7(1) Section 5 "Description of this mortgage" must contain the following additional information and text in this order after the details required by MCOB 9.4.24 R to MCOB 9.4.29 R:(a) "This lifetime mortgage involves [name of mortgage lender] taking a percentage share in any increase in the value of your property [insert details of all occasions when
The requirements at MCOB 9.4.130 R(1) must be immediately followed by the following additional text, prominently displayed:"You will need to pay this share in the value of your home to [name of mortgage lender] [insert time at which share must be paid - for example 'when your lifetime mortgage is repaid']. Think carefully about how this will affect the amount left over for you or your estate."10
If only part of the loan under the lifetime mortgage is of the type described in MCOB 9.4.132AR (for example, if part of the loan is on an interest roll-up basis from the outset, and part is convertible from interest-paying to interest roll-up):(1) the modifications set out in MCOB 9.4.132DR apply only to that part of the loan that is of the type described in MCOB 9.4.132AR; and(2) the projection of roll-up of interest on the part of the loan that is on an interest roll-up basis
12MCOB 9.4 applies to the lifetime mortgageillustration with the following modifications:(1) Section 7 of the illustration (“Risks – important things you must consider”) must also include information about any fees that may be charged, and other adverse consequences (such as a change in interest rate) that may occur, as a result of the customer choosing to convert the mortgage to interest roll-up.(2) Section 8(A) of the illustration should be headed “What you will owe and when
(1) 12An illustration for the type of lifetime mortgage described in MCOB 9.4.132AR will include both Section 8(A) and Section 8(B). Section 8(A) will show the number and amount of required or expected regular payments from the start of the lifetime mortgageuntil maturity (i.e. what will happen if the mortgage never converts to an interest roll-up basis), or until the date (if any) at which the mortgage automatically converts. Section 8(B) will show what happens if the mortgage
(1) 8Unless (2) applies, under the section heading "Which service are we providing you with?" the prescribed text in the home reversion planillustration under this heading must be included with a "check box" for each statement, one of which must be marked prominently to indicate the level of service provided to the customer;(2) If the level of service described in the illustration is provided by another firm, (1) may be replaced by the following: under the section heading "Which
(1) 8Under the section heading "What you have told us", the illustration must state the minimum information a firm must obtain from the customer (apart from details of the plan that the customer is interested in, which is in Section 5 of the illustration), and can include brief details of any other information that has been obtained from the customer and used to produce the illustration.(2) For an instalment reversion plan, where the customer requests an additional illustration
8At the end of Section 4 of the illustration a statement must be included making clear that changes to any of the information obtained from the customer, and where appropriate to the valuation of the property, could alter the details elsewhere in the illustration and encouraging the customer to ask for a revised illustration in this event.
8Under the section heading "Description of this home reversion plan" the illustration must:(1) state the name of the reversion provider providing the home reversion plan to which the illustration relates (a trading name used by the reversion provider may also be stated), and the name, if any, used to market the home reversion plan;(2) include a statement describing the home reversion plan;(3) if the home reversion plan is linked to an investment, and payments required from the
8Under the section heading "Benefits", the illustration must include:(1) a description of the monetary amount(s), and in a box aligned to the right of the document, the monetary amount(s), that the customer will receive as a lump sum and/or as a regular payment;(2) if the home reversion plan is linked to an investment and the payments required from the customer on the home reversion plan will be deducted from the income from the investment, the monetary amount of the net income
8The illustration must include under the heading "Risks - important things you must consider" brief statements and warnings on all material risks involving a home reversion plan, including:(1) prominently at the beginning of the section: "A home reversion is a complex property transaction. You should seek legal advice to ensure that you fully understand all of the implications for you and your home and for anyone who might otherwise inherit the property.";(2) the effect of the
8Under the heading "Risks - important things you must consider" the illustration must also include the following if they apply:(1) for an instalment reversion plan, a statement that if the customer dies in the early years of the plan, income payments will cease and therefore the full expected benefits of the plan will not be obtained;(2) (a) for an instalment reversion plan where there is a regular cash sum payable; and(b) where:(i) the home reversion plan is linked to an investment;
(1) An example of a misleading communication in CONC 7.9.2 R is a calling card left at the customer's address which states or implies that the customer has missed a delivery and encourages the customer to make contact.[Note: paragraph 3.3d (box) of DCG](2) The clear fair and not misleading rule in CONC 3.3.1 R also applies to a firm in relation to a communication with a customer in relation to credit agreement1 or a consumer hire agreement.
When contacting a customer:(1) a firm must ensure that it does not act in a way likely to be publicly embarrassing to the customer; and(2) a firm must take reasonable steps to ensure that third parties do not become aware that the customer is being pursued in respect of a debt[Note: paragraph 3.7q of DCG].
The reasonable steps required by CONC 7.9.7 R may, for example, require a firm to ensure that:(1) post sent by the firm is properly addressed to the customer and marked “private and confidential” or an expression to the same effect;(2) where the firm has a name which indicates its debt collection activities, its name is not shown so that third parties may see the name on the firm's communications.
Failure to explain the purpose and intended outcome of a proposed initial visit to the customer or2 to give adequate notice prior to a proposed2 initial visit to the customer may not contravene CONC 7.9.12 R, provided that2 the customer is happy to speak to the person pursuing recovery of the debt at that time. However, where, at the initial visit the customer indicates a preference to use the first visit to agree a more convenient time for a future visit, the person pursuing
A firm must ensure that all persons visiting a customer's property on its behalf act at all times in accordance with the requirements of CONC 7 and do not:(1) act in a threatening manner towards a customer;(2) visit a customer at a time when they know or suspect that the customer is, or may be, particularly vulnerable;(3) visit at an inappropriate location unless the customer has expressly consented to the visit;(4) enter a customer's property without the customer's consent or
A firm that enters into a lifetime mortgage1 with a customer where interest payments are required (whether or not they will be collected by deduction from the income from an annuity or other linked investment product) must provide the customer with the following information before the customer makes the first payment under the contract:1(1) the amount of the first payment required;(2) the amount of the subsequent payments;(3) the method by which the payments will be collected
A firm that enters into a lifetime mortgage1 which is a drawdown mortgage, with fixed payments to the customer, must provide the customer with the following information before the first payment is drawn down by the customer:1(1) the amount of the first payment to be made;(2) the amount of subsequent payments, if different; (3) the method by which the payment will be made (for example, by transfer to the customer's bank account) and the date of issue of the first and subsequent
Where the lifetime mortgage1 is a drawdown mortgage and the customer can choose the amount and frequency of the payments they receive, or the amount and frequency of payments can vary for other reasons (for example in line with interest rates) the firm must provide the customer with the following information before the first payment is drawn down by the customer:1(1) (a) where the customer can choose the amount and frequency of the payments they receive, details of any limitations
Where thelifetime mortgage1 provides for a lump sum payment to be made to the customer, and all or part of the interest will be rolled up during the life of the mortgage, the firm must provide the customer with the following information before the customer makes the first payment under the contract, or if no payments are required from the customer, within seven days of completion of the mortgage:1(1) if no payments are required from the customer, confirmation that no payments
(1) A firm must make and retain an adequate record of the information that it provides to each customer at the start of the lifetime mortgage1 in accordance with this section.1(2) The record required by (1) must be maintained for a year from the date that the information is provided to the customer.
2CONC 3.7.5 R to CONC 3.7.8 G:(1) apply to a financial promotion or a communication with a customer in relation to credit broking whether or not it is in relation to a regulated credit agreement; but(2) do not apply to a financial promotion or a communication with a customer which clearly indicates that it is made solely in respect of credit broking in relation to a credit agreement secured by a legal or equitable mortgage on land.
A firm should in a financial promotion or in a communication with a customer:(1) make clear, to the extent an average customer of the firm would understand, the nature of the service that the firm provides; [Note: paragraphs 3.7e and 4.8b of CBG](2) indicate to the customer in a prominent way the existence and nature3 of any financial arrangements with a lender that might impact upon the firm's impartiality in promoting or recommending a credit1 product to the3customer or which
2CONC 3.7.5 R requires all financial promotions and communications with customers to specify the legal name of the firm: the rule does not prohibit the use of trading names, but does require the legal name to be given in addition to any trading name used. If the firm is a company registered under the Companies Act 2006, the firm's legal name will be the name by which it is registered.
It is the responsibility of a mortgage intermediary to ensure compliance with MCOB 5.4.3 R. However, where a firm can show that it was reasonable for it to rely on information provided to it by another person, other than the mortgage lender, that an illustration was accurate, it 4 may be able to rely on MCOB 2.5.2 R, if this turns out not to be the case.4
3MCOB 53 places no restrictions on the provision of information that is not specific to the amount the customer wants to borrow, for example, marketing literature including generic mortgage repayment tables or graphs illustrating the benefits of making a regular overpayment on a flexible mortgage. Such literature may, however, constitute a financial promotion2 and be subject to the provisions of MCOB 3A4(Financial promotions and communications with customers).424
5When a firm issues an illustration for a retirement interest-only mortgage that will be used to release capital, the firm must inform the customer that taking out the mortgage may affect the customer’s tax position and entitlement to benefits, and that the customer should consider taking advice on these issues before applying.
This chapter does not apply to2 telephone lines which:(1) enable payment service users to request information to which paragraph (2) of regulation 562 of the Payment Services Regulations applies; or(2) relate to the termination of a framework contract, unless:(a) the framework contract was concluded either for a fixed period of more than 12 months or for an indefinite period; and(b) at least 12 months of the framework contract have expired.
An effect of GEN 7.1.1R and GEN 7.2.1R is that this chapter applies for contracts by which a firm provides, or agrees to provide, credit broking services. In particular, this chapter applies where a telephone line is operated by a credit broker so that following the entry into a contract for the provision of credit broking services, a customer is able to contact the firm with a view to entering into a credit agreement or a consumer hire agreement.
The following provisions of CONC continue to apply where a firm operates a telephone line in respect of the relevant credit-related regulated activities but the call charges rule does not apply (for example, where a telephone line is operated for the purpose of enabling a consumer to contact the firm before a contract has been entered into):(1) CONC 2.5.8R and CONC 2.5.9G (unfair business practices: credit broking);(2) CONC 2.6.3R and CONC 2.6.4G (unfair business practices: debt
(1) If a client communicates to a firm that it wishes (whether pursuant to a contractual right or otherwise) to terminate a TTCA5, and the client's communication is not in writing, the firm must make a written record of the client's communication, which also records the date the communication was received.(2) A firm must keep a client's written communication, or a written record of the client's communication in (1), for five years starting from the date the communication was received
When a firm notifies a client under CASS 7.11.9 R (3)(a) of when the termination of a TTCA5 is to take effect, it should take into account:(1) any relevant terms relating to such a termination that have been agreed with the client; and(2) the period of time it reasonably requires to return the money to the client, or to update its records under CASS 7.15 (Records, accounts and reconciliations) and to segregate the money as client money under CASS 7.13 (Segregation of client m
(1) If a TTCA is terminated then, unless otherwise permitted under the client money rules and notified to the client under CASS 7.11.9R(3)(a), the firm must treat that money as client money from the start of the next business day following the date of termination as set out in the firm’s notification under CASS 7.11.9R (3)(a). 5(2) Where the firm’s notification under CASS 7.11.9R(3)(a) does not state when the termination of the arrangement will take effect, the firm must treat
Where a firm transfers client money belonging to its clients under either or both of CASS 7.11.42 R and CASS 7.11.44 R it must ensure that those clients are notified no later than seven days after the transfer taking place:(1) whether or not the sums will be held by the person to whom they have been transferred in accordance with the client money rules and if not how the sums being transferred will be held by that person;(2) the extent to which the sums transferred will be protected
(1) Taking reasonable steps in CASS 7.11.50 R (3) includes following this course of conduct:(a) determining, as far as reasonably possible, the correct contact details for the relevant client;(b) writing to the client at the last known address either by post or by electronic mail to inform it of the firm's intention to no longer treat the client money balance as client money and to pay the sums concerned to charity if the firm does not receive instructions from the client within
For the purpose of CASS 7.11.52 E (1)(a), a firm may use any available means to determine the correct contact details for the relevant client, including telephoning the client, searching internal records, media advertising, searching public records, mortality screening, using credit reference agencies or tracing agents.
(1) If a firm pays away client money under CASS 7.11.50 R (4) it must make and retain, or where the firm already has such records, retain: (a) records of all balances released from client bank accounts under CASS 7.11.50 R (including details of the amounts and the identity of the client to whom the money was allocated); (b) all relevant documentation (including charity receipts); and(c) details of the communications the firm had or attempted to make with the client concerned pursuant
A firm may pay away to a registered charity of its choice a client money balance which is allocated to a client and if it does so the released balance will cease to be client money under CASS 7.11.34 R (10):(1) the balance in question is (i) for a retail client, in aggregate, £25 or less, or (ii) for a professional client, in aggregate, £100 or less; (2) the firm held the balance concerned for at least six years following the last movement on the client's account (disregarding
The following numbers, if used by firms, would comply with the call charges rule:(1) geographic numbers or numbers which are always set at the same rate, which usually begin with the prefix 01, 02 or 03;(2) calls which can be free of charge to call, for example 0800 and 0808 numbers; and(3) standard mobile numbers, which usually begin with the prefix 07, provided that the firm ordinarily uses a mobile number to receive telephone calls.
The following numbers, if used by firms, would not comply with the call charges rule:(1) premium rate numbers that begin with the prefix 09;(2) other revenue sharing numbers in which a portion of the call charge can be used to either provide a service or make a small payment to the firm, such as telephone numbers that begin with the prefix 084 or 0871, 0872 or 0873; and(3) telephone numbers that begin with the prefix 0870 as the cost of making a telephone call on such numbers
A firm must ensure that the information on contractual obligations to be communicated to a consumer during the pre-contractual phase is in conformity with the contractual obligations which would result from the law presumed to be applicable to the distance contract if that contract is concluded.[Note: article 3(4) of the Distance Marketing Directive]
A firm must communicate to the consumer all the contractual terms and conditions and the information referred to in the distance marketing disclosure rules in writing or another durable medium available and accessible to the consumer in good time before conclusion of any distance contract.[Note: article 5(1) of the Distance Marketing Directive]
(1) In the case of a voice telephony communication, and subject to the explicit consent of the consumer, only the abbreviated distance marketing information (ICOBS 3 Annex 3 R) needs to be provided during that communication.(2) However, unless another exemption applies (such as the exemption for means of distance communication not enabling disclosure) a firm must still provide the distance marketing information (ICOBS 3 Annex 2 R) in writing or another durable medium available
Where a customer disputes a debt and the firm seeking to recover the debt is not the lender or the owner, the firm must:(1) pass the information provided by the customer to the lender or the owner; or[Note: paragraph 3.23h of DCG](2) if the firm has authority from the lender or owner to investigate a dispute, it must notify the lender or owner of the outcome of the investigation.
Examples of conduct that may contravene CONC 7.14.10 R would, depending on the circumstances, include where following an unacceptable offer a firm immediately:(1) sends field agents to visit the customer or communicates to the customer that it will do so;[Note: annex A5 (box) to DCG](2) substantially increases the rate of interest or imposes a substantial charge or communicates that is will do either of those things.
(1) The clear, fair and not misleading rule in CONC 3.3.1 R applies to a communication with a customer or the communication or approval for1communication of a financial promotion in relation to debt counselling or debt adjusting and in relation to a communication with a customer in relation to providing credit information services. (2) In the light of the complexity of debt counselling, it is unlikely that media which provide restricted space for messages would be a suitable means
A firm must ensure that a financial promotion or a communication with a customer (to the extent a previous communication to the same customer has not included the following information) includes:(1) a statement of the services the firm offers;(2) a statement of any relationship with a business associate which is relevant to the services offered in the promotion; [Note: paragraph 2.5a of DMG](3) a statement setting out the level of fees charged for the firm's services, how they
A financial promotion or a communication with a customer by a firm must not:(1) falsely claim or imply that the help and debt advice is provided on a free, impartial or independent basis, where the firm has a profit-seeking motive; [Note: paragraph 3.18b of DMG](2) falsely claim or imply4 in any way that the firm is, or represents, a charitable or not-for-profit body or government or local government organisation; [Note: paragraph 3.18c of DMG](3) promote a claims management
(1) Activities in relation to a consumer hire agreement are not financial services within the meaning of the Distance Marketing Directive and do not fall within CONC 2.7. Instead such agreements fall within the Consumer Protection (Distance Selling) Regulations 2000 (SI 2000/2334) if they were made before 13 June 2014, or the Consumer Contracts (Information, Cancellation and Additional Charges) Regulations 2013 (SI 2013/3134) if they were made on or after that date2.(2) A firm
In the case of voice telephony communication, and subject to the explicit consent of the consumer, only the abbreviated distance marketing information (CONC 2 Annex 2R) needs to be provided during that communication. However, unless another exception applies (such as the exemption for means of distance communication not enabling disclosure), a firm must still provide the distance marketing information (CONC 2 Annex 1R) in a durable medium that is available and accessible to the
A firm may provide the distance marketing information (CONC 2 Annex 1R) and the contractual terms and conditions in a durable medium immediately after the conclusion of a distance contract, if the contract has been concluded at a consumer's request using a means of distance communication that does not enable the provision of that information in that form in good time before the consumer is bound by any distance contract or offer.[Note: article 5(2) of the Distance Marketing
Where a distance contract covers both payment services and non-payment services, the exception in CONC 2.7.2R (2) applies only to the payment services aspects of the contract. A firm taking advantage of this exception will need to comply with the information requirements in Part 63 of the Payment Services Regulations.
(1) A firm must not enforce, or seek to enforce, any obligations under a distance contract against a consumer in the event of an unsolicited supply of services. The absence of a reply does not constitute consent.(2) This rule does not apply to the tacit renewal of a distance contract.[Note: regulation 15 of SI 2004/2095][Note: article 9 of the Distance Marketing Directive]
The statement required by MCOB 7.5.1 R must contain the following information:(1) except in the case of mortgage credit cards, information on the type oflifetime mortgage,3 (for example, fixed rate or variable rate) including a clear statement of how the firm expects the capital, or capital and interest (whichever is applicable) to be repaid (for example, from the proceeds of the sale of the property);3(2) details of the following transactions and information on the lifetime
Where a firm provides a customer with a statement containing the information set out in MCOB 9.8.1 R(2) more frequently than once a year, the information set out in MCOB 9.8.1 R(1), MCOB 9.8.1 R(3) and MCOB 9.8.1 R(4) may be provided in a separate communication, but must be provided at least once a year.
A firm must give the customer reasonable notice, in advance, of any of the following:(1) any changes to the payments that the customer is required to make (where payments are required, and whether or not they are collected by deduction from the income provided by a linked investment product such as annuity) resulting from interest rate changes;(2) the exercising of the firm's right (if allowed by the terms of the lifetime mortgage3 ) to enter the property to carry out essential
If a customer requests, or agrees to, a change to a lifetime mortgage3 (other than a change as described in MCOB 7.6.7 R to MCOB 7.6.27 R (as modified by MCOB 9)) that changes the amount of each payment due (where payments are required), a firm must provide the customer with the following information, in a single communication, before the change takes effect:3(1) the amount outstanding on the lifetime mortgage3 at the date the change is requested;3(2) the payment due and the frequency
If a customer requests, or agrees to, a change to a lifetime mortgage.3(other than a change as described in MCOB 7.6.7 R to MCOB 7.6.27 R (as modified by MCOB 9)) that changes the amount paid to the customer under a drawdown mortgage, or the amount that the customer will owe under an interest roll-up mortgage5, or both, a firm must provide the customer with the following information, in a single communication, before the change takes effect:3(1) the amount outstanding on the lifetime
(1) A firm must ensure that a communication or a financial promotion is clear, fair, and not misleading. [Note: paragraphs 2.2 of ILG, 3.16 of DMG and 3.1 of CBG](1A) A firm must ensure that each communication and each financial promotion:3(a) is clearly identifiable as such;3(b) is accurate;3(c) is balanced and, in particular, does not emphasise any potential benefits of a product or service without also giving a fair and prominent indication of any relevant risks;3(d) is sufficient
A firm must ensure that a communication or a financial promotion:(1) uses plain and intelligible language;(2) is easily legible (or, in the case of any information given orally, clearly audible);(3) specifies the name of the person making the communication or communicating the financial promotion or the person on whose behalf the financial promotion is made; and(4) in the case of a communication or financial promotion in relation to credit broking, specifies3 the name3 of the
(1) A firm must not in a financial promotion or a communication to a customer state or imply3 that credit is available regardless of the customer’s financial circumstances or status.[Note: paragraphs 3.7o of CBG and 5.2 of ILG](2) This rule does not apply to a financial promotion or communication relating to a credit agreement under which a person takes an article in pawn and the customer’s total financial liability (including capital, interest and all other charges) is limited
If a communication or a financial promotion names the FCA, PRA or both as the regulator of a firm and refers to matters not regulated by the FCA, PRA or both, the firm should ensure that the communication or financial promotion makes clear that those matters are not regulated by the FCA, PRA or both.
A firm should in a financial promotion or other communication which includes a premium rate telephone number indicate in a prominent way the likely total cost of a premium rate call including the price per minute of a call, the likely duration of calls and the total cost a customer would incur if the customer calls for the full estimated duration.Firms should note the effect of the call charges rule in GEN 7.2[Note: paragraphs 3.9h of CBG and 3.18x (box) of DMG]
If a client has
notified a firm in writing that
he does not wish his money to
be held with a bank in the same group as
the firm, the firm must
either:(1) place
that client money in a client bank account with another bank in
accordance with CASS
5.5.38 R; or(2) return
that client money to, or pay
it to the order of, the client.
A firm must
not hold, for a consumer5, client money in
a client bank account outside
the United Kingdom, unless
the firm has previously disclosed
to the consumer5 (whether in its terms of business, client
agreement11 or otherwise in writing):5511(1) that
his money may be deposited in
a client bank account outside
the United Kingdom but that
the client may notify the firm that he does not wish his money to be held in a particular jurisdiction;(2) that
in such circumstances, the
If a client has
notified a firm in writing before
entering into a transaction that client money is
not to be held in a particular jurisdiction, the firm must
either:(1) hold
the client money in a client bank account in a jurisdiction to
which the client has not objected;
or(2) return
the client money to, or to the
order of, the client.
(1) If the client elects not to provide the information to enable the firm to assess appropriateness, or if he provides insufficient information regarding his knowledge and experience, the firm must warn the client that such a decision will not allow the firm to determine whether the service or product envisaged is appropriate for him.(2) This warning may be provided in a standardised format.1
Section 21(3) of the Act states that, in the case of a communication originating outside the United Kingdom, the restriction in section 21(1) applies only if it is capable of having an effect in the United Kingdom. In this respect, it is irrelevant whether the communication has an effect provided it is capable of doing so.
This appears to give a potentially broad jurisdictional scope to section 21. It seems clear that a communication which originates overseas will be capable of having an effect in the United Kingdom if it is an invitation or inducement to engage in investment activity which is communicated to a person in the United Kingdom. It would seem that communications made in other circumstances may also be capable of having an effect in the United Kingdom. However, the exemption for communications
For example, a person misrepresents authority or the legal position if they claim to work on instructions from the courts as bailiffs or, in Scotland, sheriff officers or messengers-at-arms, or in Northern Ireland, to work on instructions from the Enforcement of Judgements Office when this is untrue.[Note: paragraph 3.5a of DCG ]