QFA Loans - Sample Paper 1 Test
Questions and All Correct Answers
2026-2027 Updated.
A lender generally charges a lower interest rate on a housing loan because:
A the loan is secured against the property.
B they are required to do so by the Consumer
Credit Act, 1995.
C the loan is unsecured.
D they are required to do so by the Consumer Protection Code. - Answer A
1.2 - Individual Loan Needs
Finn buys a car by taking out a Personal Payment Plan (PPP). When will Finn be the legal owner
of the car?
A As soon as the contract is signed.
B After he pays an initial deposit.
C When the final payment has been made.
D When 50% of all payments have been made. - Answer C
1.2.1 Different forms of Loans
To which of the following consumers do the provisions of the Consumer Protection Code, 2012
NOT apply?
A Janet, who has borrowed €10,000 as a personal loan from Clear Bank.
B Jennifer, who has engaged the services of a Debt Management firm to act on her behalf with
her creditors.
C Ross, who has taken out a life assurance policy with his local Credit Union.
D James, who has received finance under a hire-purchase agreement. - Answer D
1.6.2 Consumer Protection Code, 2012
Mary referred a complaint she had made about Delta Bank to the Financial Services and
Pensions Ombudsman (FSPO) as she was unhappy with their final response. The FSPO upheld
Mary's complaint and awarded her compensation of €50,000. Delta Bank wish to appeal the
FSPO's decision.
,Within how many days of the FSPO's decision must Delta Bank submit their appeal to the High
Court?
A 15 days
B 20 days
C 30 days
D 35 days - Answer D
1.5.3.1 Financial Services and Pensions Complaints Process
Which of the following is not an element of a valid contract?
A Consideration
B Acceptance
C Verification
D Capacity - Answer C
1.7.1 Essential Elements of a Valid Contract
Philip agrees to offer West Bank collateral security against a housing loan. This most likely
means that Philip is providing:
A a third party, who will agree to make the loan repayments if he defaults on his loan.
B a legal mortgage over the freehold property.
C a personal covenant to repay the loan.
D an assignment of a home contents insurance policy. - Answer A
2.4 - Security for Housing Loans
In the early years of a loan which is arranged on a capital and interest basis, the:
A largest part of the monthly payment is used to pay the interest charge.
B capital portion reduces quickly.
C interest portion is suspended.
D largest part of the monthly payment is used to pay off the capital sum borrowed. - Answer A
2.10.1 - Capital and interest
Rita holds a variable rate mortgage with Beta Bank. Beta Bank must provide Rita with a
notification advising her of any change in the interest rate:
, A as soon as the bank becomes aware that they are changing the interest rate.
B no later than 10 business days following a change in the ECB refi rate.
C at least 20 business days in advance of any interest rate change.
D at least 30 days in advance of any interest rate change. - Answer D
2.12 Housing Loan Interest Rates
What factor(s) determine how a mortgage lender calculates their variable mortgage interest
rates?
(i) Cost of funds.(ii) Competition in the market place. (iii) Profit margin.
A (i) only.
B (i) and (ii) only.
C (i) and (iii) only.
D (i), (ii) and (iii) - Answer D
2.11.1 - Standard Variable Rate
Why might a fixed rate mortgage be the MOST suitable mortgage for a first time buyer?
A Lenders offer higher Loans to Value (LTV) for fixed rate mortgages than for variable rate
mortgages.
B Fixed rate borrowers are not usually required to take out mortgage protection cover.
C The borrower can get a higher rate of mortgage interest tax relief.
D The repayments are guaranteed not to increase during the fix period, offering the borrower
stability. - Answer D
2.11.3 - Fixed Rate
Where a lender intends to charge a redemption fee, it is required to provide to the borrower
with:
(i) a copy of the loan offer.
(ii) a worked example of the redemption charge specific to their circumstances.
(iii) details on how the charge is calculated.
A (i) only.
B (i) and (ii) only.
C (ii) and (iii) only.
D (i), (ii) and (iii). - Answer C
Questions and All Correct Answers
2026-2027 Updated.
A lender generally charges a lower interest rate on a housing loan because:
A the loan is secured against the property.
B they are required to do so by the Consumer
Credit Act, 1995.
C the loan is unsecured.
D they are required to do so by the Consumer Protection Code. - Answer A
1.2 - Individual Loan Needs
Finn buys a car by taking out a Personal Payment Plan (PPP). When will Finn be the legal owner
of the car?
A As soon as the contract is signed.
B After he pays an initial deposit.
C When the final payment has been made.
D When 50% of all payments have been made. - Answer C
1.2.1 Different forms of Loans
To which of the following consumers do the provisions of the Consumer Protection Code, 2012
NOT apply?
A Janet, who has borrowed €10,000 as a personal loan from Clear Bank.
B Jennifer, who has engaged the services of a Debt Management firm to act on her behalf with
her creditors.
C Ross, who has taken out a life assurance policy with his local Credit Union.
D James, who has received finance under a hire-purchase agreement. - Answer D
1.6.2 Consumer Protection Code, 2012
Mary referred a complaint she had made about Delta Bank to the Financial Services and
Pensions Ombudsman (FSPO) as she was unhappy with their final response. The FSPO upheld
Mary's complaint and awarded her compensation of €50,000. Delta Bank wish to appeal the
FSPO's decision.
,Within how many days of the FSPO's decision must Delta Bank submit their appeal to the High
Court?
A 15 days
B 20 days
C 30 days
D 35 days - Answer D
1.5.3.1 Financial Services and Pensions Complaints Process
Which of the following is not an element of a valid contract?
A Consideration
B Acceptance
C Verification
D Capacity - Answer C
1.7.1 Essential Elements of a Valid Contract
Philip agrees to offer West Bank collateral security against a housing loan. This most likely
means that Philip is providing:
A a third party, who will agree to make the loan repayments if he defaults on his loan.
B a legal mortgage over the freehold property.
C a personal covenant to repay the loan.
D an assignment of a home contents insurance policy. - Answer A
2.4 - Security for Housing Loans
In the early years of a loan which is arranged on a capital and interest basis, the:
A largest part of the monthly payment is used to pay the interest charge.
B capital portion reduces quickly.
C interest portion is suspended.
D largest part of the monthly payment is used to pay off the capital sum borrowed. - Answer A
2.10.1 - Capital and interest
Rita holds a variable rate mortgage with Beta Bank. Beta Bank must provide Rita with a
notification advising her of any change in the interest rate:
, A as soon as the bank becomes aware that they are changing the interest rate.
B no later than 10 business days following a change in the ECB refi rate.
C at least 20 business days in advance of any interest rate change.
D at least 30 days in advance of any interest rate change. - Answer D
2.12 Housing Loan Interest Rates
What factor(s) determine how a mortgage lender calculates their variable mortgage interest
rates?
(i) Cost of funds.(ii) Competition in the market place. (iii) Profit margin.
A (i) only.
B (i) and (ii) only.
C (i) and (iii) only.
D (i), (ii) and (iii) - Answer D
2.11.1 - Standard Variable Rate
Why might a fixed rate mortgage be the MOST suitable mortgage for a first time buyer?
A Lenders offer higher Loans to Value (LTV) for fixed rate mortgages than for variable rate
mortgages.
B Fixed rate borrowers are not usually required to take out mortgage protection cover.
C The borrower can get a higher rate of mortgage interest tax relief.
D The repayments are guaranteed not to increase during the fix period, offering the borrower
stability. - Answer D
2.11.3 - Fixed Rate
Where a lender intends to charge a redemption fee, it is required to provide to the borrower
with:
(i) a copy of the loan offer.
(ii) a worked example of the redemption charge specific to their circumstances.
(iii) details on how the charge is calculated.
A (i) only.
B (i) and (ii) only.
C (ii) and (iii) only.
D (i), (ii) and (iii). - Answer C
