FCA Handbook - MCOB 12.1 Application

You are viewing MCOB 12.1 Application as of . MCOB 12.1 Application was last updated on 21/03/2016.

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MCOB 12.1 Application

Who?

This chapter applies to a firm in a category listed in column (1) of the table in MCOB 12.1.2 R in accordance with column (2) of that table.

This table belongs to MCOB 12.1.1 R

(1) Category of firm	(2) Applicable section
mortgage lender	whole chapter except MCOB 12.1.6 R and MCOB 12.7
mortgage adviser mortgage arranger	MCOB 12.1 (except MCOB 12.1.6 R), MCOB 12.2 and MCOB 12.5.2 R
mortgage administrator a firm that was a mortgage lender or mortgage administrator before the sale of a repossessed property	MCOB 12.1 (except MCOB 12.1.6 R), MCOB 12.2, MCOB 12.4 and MCOB 12.5.2 R
home purchase provider home purchase adviser home purchase arranger home purchase administrator a firm that was a home purchase provider or home purchase administrator before the sale of a repossessed property	MCOB 12.1.1 R to MCOB 12.1.3 R and MCOB 12.7
regulated sale and rent back firm	MCOB 12.1.1 R to MCOB 12.1.3 R, MCOB 12.2.1 G and MCOB 12.5
reversion provider	MCOB 12.1, MCOB 12.2 and MCOB 12.5.1 R to MCOB 12.5.3 G
reversion adviser reversion arranger reversion administrator a firm that was a reversion provider or reversion administrator before the termination of a home reversion plan	MCOB 12.1, MCOB 12.2, MCOB 12.5.2 R and MCOB 12.5.3 G

What?

This chapter applies where a firm:

(1)
enters into, or makes a further advance on, a home finance transaction; or
(2)
administers a home finance transaction; or
(3)
arranges or advises on a home finance transaction or a variation to the terms of a home finance transaction.

The payment shortfall charges and excessive charges requirements in this chapter will continue to apply to a firm after a regulated mortgage contract has come to an end following the sale of a repossessed property. The excessive charges requirements will continue to apply to a firm after a home reversion plan has ended. References in this chapter to 'customer' will include references to a former customer as appropriate.

The FCA will expect a firm to ensure that charges made to a customer arising from the sale of a repossessed property and charges arising in relation to a sale shortfall are not excessive and are subject to the same considerations as apply with respect to payment shortfall charges under this chapter.

Charges under regulated mortgage contracts which had previously been regulated credit agreements

The rules in MCOB 12.4 (Payment shortfall charges: regulated mortgage contracts) and MCOB 12.5 (Excessive charges: regulated mortgage contracts, home reversion plans and regulated sale and rent back agreements) apply to:

(1)
second charge regulated mortgage contracts entered into before 21 March 2016, in relation to charges imposed on a customer for events occurring on or after 21 March 2016; and
(2)
regulated mortgage contracts which are legacy CCA mortgage contracts secured by a first charge legal mortgage, in relation to charges imposed on a customer for events occurring on or after the earliest of:
1. (a)
  the date on which the lender first acts in compliance or purported compliance with rules in the FCA Handbook which apply to regulated mortgage contracts in respect of the contract;
2. (b)
  the date from which the lender notifies the borrower in writing that it will act in compliance with such rules in respect of the contract; and
3. (c)
  21 March 2017.

This chapter does not apply to a firm carrying on reversion activities or regulated sale and rent back activities in respect of a customer acting in his capacity as an unauthorised reversion provider or as an unauthorised SRB agreement provider.