CeMAP Module II 2

Question 1

What is the legal distinction between freehold and leasehold property in England and Wales?

Accepted Answer

Freehold grants indefinite ownership of land and buildings, while leasehold grants possession for a fixed term under a lease from the freeholder

Answer

Freehold is absolute ownership of land for an indefinite period, while leasehold is the right to occupy for a fixed period under the terms of a lease granted by the freeholder.

Question 2

How does the conveyancing process differ for registered and unregistered land?

Accepted Answer

Registered land has title guaranteed by the Land Registry with simplified transfer, while unregistered land requires investigation of title deeds going back at least 15 years

Answer

Registered land has its title recorded at the Land Registry, simplifying transfer. Unregistered land requires investigation of an unbroken chain of title deeds, typically for at least 15 years.

Question 3

What is a mortgage valuation and how does it differ from a full structural survey?

Accepted Answer

A mortgage valuation is a basic assessment of property value for the lender's purposes, while a structural survey is a comprehensive inspection of the property's condition for the buyer

Answer

A mortgage valuation is a brief assessment confirming the property is adequate security for the loan. A structural survey is a thorough examination of the property's condition for the buyer's benefit.

Question 4

What is the role of a title guarantee in a property transaction?

Accepted Answer

It is the seller's assurance about the quality of the title being transferred, with full title guarantee providing the strongest assurances

Answer

When a property is sold, the seller provides title guarantee — full title guarantee includes covenants about the right to sell, freedom from encumbrances, and compliance with lease terms.

Question 5

What is buildings insurance and why do mortgage lenders require it?

Accepted Answer

It insures the physical structure against damage from fire, flood, subsidence and other perils, protecting the lender's security

Answer

Buildings insurance covers the cost of repairing or rebuilding the physical structure. Lenders require it because the property is their security — if it is destroyed, the security is lost.

CeMAP - Certificate in Mortgage Advice and Practice Practice Test

CeMAP - Certificate in Mortgage Advice and Practice Practice Test

CeMAP Module II 2