CeMAP Mortgage Application Process 2

Question 1

At which stage of the mortgage process does the lender's valuation typically take place?

Accepted Answer

After the full application has been submitted

Answer

Before the Decision in Principle

Answer

After the mortgage offer has been issued

Answer

At the point of completion

Question 2

What is the role of a mortgage broker's compliance department in the application process?

Accepted Answer

To check that advice given meets regulatory standards before submission

Answer

To negotiate better rates with lenders

Answer

To carry out credit checks on behalf of the lender

Answer

To arrange buildings insurance for the client

Question 3

What does the term 'gazumping' mean in the UK property market?

Accepted Answer

A seller accepting a higher offer from another buyer after already accepting an offer

Answer

A buyer withdrawing from a purchase at the last minute

Answer

A lender withdrawing a mortgage offer before completion

Answer

A surveyor downvaluing a property

Question 4

What are local authority searches and why are they important in the mortgage process?

Accepted Answer

They reveal planning decisions, road schemes, and other matters that could affect the property

Answer

They verify the borrower's identity for anti-money laundering purposes

Answer

They confirm the property's council tax band

Answer

They check whether the property is listed on the Land Registry

Question 5

What happens if a mortgage offer expires before completion?

Accepted Answer

The borrower or their solicitor must request an extension or a new offer from the lender

Answer

The borrower must find a new property

Answer

The mortgage is automatically renewed on current terms

Answer

The lender must complete regardless of the expiry

Question 6

Under anti-money laundering regulations, what must a mortgage adviser verify about a client's deposit?

Accepted Answer

The source of the deposit funds and that they are legitimate

Answer

Only that the deposit exists in a bank account

Answer

That the deposit is at least 25% of the property value

Answer

That the deposit has been held for at least 6 months