In the first of a new series, SimplyBiz provides the answers to four burning questions its members have been asking in recent weeks.
Q What are my options for mortgage advice if a client wants to buy a property to let to a relative?
When the proposed tenant of a property is related to the landlord, any mortgage would have to be on a regulated buy-to-let (BTL) basis, which means that a number of the usual BTL lenders are unable to consider these cases.
Two that do lend on these cases are Northern Rock and Leeds Building Society however, that both these lenders will disregard the rental income and affordability is based solely on the applicant’s personal income. In both cases therefore, applications will proceed on a residential basis and be treated as a second property.
Q How will group personal pensions (GPPs) be affected by the RDR?
Any new schemes established post RDR will be subject to what is known as ‘consultancy charging’ (similar to adviser charging). Existing schemes can continue to pay ongoing commission and the firm can still be paid commission upon new members joining and any members of the scheme increasing contribution.
Q I’m just about to complete my final exam which will take me to Level 4 status & I’m fairly confident that I’ll pass. Can I apply for my SPS as soon as I get my results?
If you’re still waiting to complete your last examinations or assessments, you can start preparing for the submission of your SPS in advance. In order to apply, you are going to need; to be qualified to Level 4 status, have completed (and be able to prove completion of) any necessary gap-fill, completion of appropriate CPD as defined by the relevant accredited body and a signed declaration to adhere to that body’s Code of Conduct. Make sure you double check in good time whether you will need to submit this information electronically or in hard copy, as it varies from body to body.
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