Best Buy Mortgages Glossary - Regulated Mortgage Contract
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Regulated Mortgage Contract
The Financial Services Authority (FSA) has a very strict
definition of the mortgages that it actually regulates. In
order to qualify as a regulated mortgage contract, the
following conditions have to be met:
- A lender provides credit to an individual or to
trustees (the 'borrower')
- The obligation of the borrower to repay is secured by a
first legal mortgage on land (other than timeshare
accommodation) in the United Kingdom, at least 40% of which
is used, or is intended to be used, as or in connection with
a dwelling by the borrower or (in the case of credit
provided to trustees) by an individual who is a beneficiary
of the trust, or by a person who is in relation to the
borrower or (in the case of credit provided to trustees) a
beneficiary of the trust, i.e. spouse, partner or parent,
brother, sister, child, grandparent or grandchild.
Other loans, including buy-to-let mortgages and equity release
home reversion schemes are not covered by the FSA's umbrella
although equity release lifetime mortgages will be regulated.
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