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Training
31
CeMAP
revision
So you think you know your stuff – but do you? Test yourself with
specimen CeMAP exam revision questions courtesy of ifs School of
Finance – don't worry we tell you the answers as well! For more help
with revision, lessons and to get your own personal CPD certificate don't
forget to visit the CPD section on our website mortgageintroducer.com
QUESTIONS B - valuation using an external valuer. land on which she wants to build her own
C - valuation using either its own valuer or an home.
1. George and Joan would like to raise the
external valuer.
maximum capital from their home, which
D - valuation using its own valuer. 6. What specific feature of a mortgage can avoid
they own outright, and are considering
the need for 'tacking'?
lifetime mortgages and home reversion plans,
4. George is considering remortgaging to reduce A - Daily calculation of interest.
both of which follow the SHIP Code of
his outgoings. He currently has an £80,000 B - Drawdown facility.
Practice. What is an advantage offered by the
interest only mortgage on a variable rate of C - Early repayment charge.
home reversion plan compared to the
6.2%. Which of the following packages would D - Fixed rate of interest.
mortgage based scheme?
cost the least overall over the next three years,
A - Increases in income or capital will not
assuming variable rates remain the same and a 7. A borrower is considering a remortgage from
affect State benefits.
lock in to the variable rate after the deal ends? his existing 6.5% interest only loan to a three
B - The amount owed will never exceed the
A - A 1 year fixed rate of 3.5% with no year fixed rate at 5%. He will not increase the
value of the property.
arrangement fee. £120,000 borrowing and has calculated that it
C - They will probably be able to receive more
B - A 2 year fixed rate of 4.5% with an will cost £750 in charges, fees and legal costs,
cash.
arrangement fee of £399. which he will pay from savings. At what point
D - They will retain ownership of the
C - A 3 year fixed rate of 5.15% with an will he start to benefit financially from the
property.
arrangement fee of £199. new arrangement?
D - A stepped discount of 1% in year 1 and A - Immediately.
2. Annie is a 55 year old widow and is interested
2% in year 2, with a £50 arrangement fee. B - 4 months.
in a lifetime mortgage on a roll-up basis.
C - 6 months.
Which factor might make such a plan
5. In which of the following circumstances D - 13 months.
unsuitable?
would open bridging finance be appropriate?
A - Her age.
For: 8. Nayan and Chandra are considering moving
B - She has no children.
A - John, who has exchanged contracts on the now that their first baby is due. Of what
C - She only requires cash.
sale of part of the land adjoining his should they be aware?
D - She wants to retain ownership of the
property. A - The lender's checks will be less stringent
property.
B - Louise, who wishes to purchase a property now that they are on the property ladder.
before a buyer has been found for her B - They cannot use existing life policies for
3. Jim and Paula have requested a further
existing property. the new mortgage.
advance from their lender, the Eastern
C - Mark, who has exchanged contracts on the C - They will be able to reclaim part of the
Counties Building Society. Before agreeing to
sale of his property but wishes to complete higher lending charge they paid when they
the request Eastern Counties must carry out a:
his purchase before his sale. bought their existing property.
A - property assessment.
D - Mary, who wishes to purchase a plot of D -They need to set aside money to cover costs.
www.mortgageintroducer.com November 2009 Mortgage Introducer
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