QFA LOANS - SAMPLE PAPER 1
QUESTIONS WITH ACTUAL SOLUTIONS
A ddlender ddgenerally ddcharges dda ddlower ddinterest ddrate ddon dda ddhousing ddloan
ddbecause:
A ddthe ddloan ddis ddsecured ddagainst ddthe ddproperty.
B ddthey ddare ddrequired ddto dddo ddso ddby ddthe ddConsumer
Credit ddAct, dd1995.
C ddthe ddloan ddis ddunsecured.
D ddthey ddare ddrequired ddto dddo ddso ddby ddthe ddConsumer ddProtection ddCode. dd-
ddAnswer ddA
1.2 dd- ddIndividual ddLoan ddNeeds
Finn ddbuys dda ddcar ddby ddtaking ddout dda ddPersonal ddPayment ddPlan dd(PPP). ddWhen
ddwill ddFinn ddbe ddthe ddlegal ddowner ddof ddthe ddcar?
A ddAs ddsoon ddas ddthe ddcontract ddis ddsigned.
B ddAfter ddhe ddpays ddan ddinitial dddeposit.
C ddWhen ddthe ddfinal ddpayment ddhas ddbeen ddmade.
D ddWhen dd50% ddof ddall ddpayments ddhave ddbeen ddmade. dd- ddAnswer ddC
1.2.1 ddDifferent ddforms ddof ddLoans
To ddwhich ddof ddthe ddfollowing ddconsumers dddo ddthe ddprovisions ddof ddthe ddConsumer
ddProtection ddCode, dd2012 ddNOT ddapply?
A ddJanet, ddwho ddhas ddborrowed dd€10,000 ddas dda ddpersonal ddloan ddfrom ddClear
ddBank.
B ddJennifer, ddwho ddhas ddengaged ddthe ddservices ddof dda ddDebt ddManagement ddfirm
ddto ddact ddon ddher ddbehalf ddwith ddher ddcreditors.
C ddRoss, ddwho ddhas ddtaken ddout dda ddlife ddassurance ddpolicy ddwith ddhis ddlocal
ddCredit ddUnion.
D ddJames, ddwho ddhas ddreceived ddfinance ddunder dda ddhire-purchase ddagreement. dd-
ddAnswer ddD
1.6.2 ddConsumer ddProtection ddCode, dd2012
Mary ddreferred dda ddcomplaint ddshe ddhad ddmade ddabout ddDelta ddBank ddto ddthe
ddFinancial ddServices ddand ddPensions ddOmbudsman dd(FSPO) ddas ddshe ddwas
ddunhappy ddwith ddtheir ddfinal ddresponse. ddThe ddFSPO ddupheld ddMary's ddcomplaint
,ddand ddawarded ddher ddcompensation ddof dd€50,000. ddDelta ddBank ddwish ddto ddappeal
ddthe ddFSPO's dddecision.
Within ddhow ddmany dddays ddof ddthe ddFSPO's dddecision ddmust ddDelta ddBank ddsubmit
ddtheir ddappeal ddto ddthe ddHigh ddCourt?
A dd15 dddays
B dd20 dddays
C dd30 dddays
D dd35 dddays dd- ddAnswer ddD
1.5.3.1 ddFinancial ddServices ddand ddPensions ddComplaints ddProcess
Which ddof ddthe ddfollowing ddis ddnot ddan ddelement ddof dda ddvalid ddcontract?
A ddConsideration
B ddAcceptance
C ddVerification
D ddCapacity dd- ddAnswer ddC
1.7.1 ddEssential ddElements ddof dda ddValid ddContract
Philip ddagrees ddto ddoffer ddWest ddBank ddcollateral ddsecurity ddagainst dda ddhousing
ddloan. ddThis ddmost ddlikely ddmeans ddthat ddPhilip ddis ddproviding:
A dda ddthird ddparty, ddwho ddwill ddagree ddto ddmake ddthe ddloan ddrepayments ddif ddhe
dddefaults ddon ddhis ddloan.
B dda ddlegal ddmortgage ddover ddthe ddfreehold ddproperty.
C dda ddpersonal ddcovenant ddto ddrepay ddthe ddloan.
D ddan ddassignment ddof dda ddhome ddcontents ddinsurance ddpolicy. dd- ddAnswer ddA
2.4 dd- ddSecurity ddfor ddHousing ddLoans
In ddthe ddearly ddyears ddof dda ddloan ddwhich ddis ddarranged ddon dda ddcapital ddand
ddinterest ddbasis, ddthe:
A ddlargest ddpart ddof ddthe ddmonthly ddpayment ddis ddused ddto ddpay ddthe ddinterest
ddcharge.
B ddcapital ddportion ddreduces ddquickly.
C ddinterest ddportion ddis ddsuspended.
D ddlargest ddpart ddof ddthe ddmonthly ddpayment ddis ddused ddto ddpay ddoff ddthe ddcapital
ddsum ddborrowed. dd- ddAnswer ddA
2.10.1 dd- ddCapital ddand ddinterest
Rita ddholds dda ddvariable ddrate ddmortgage ddwith ddBeta ddBank. ddBeta ddBank ddmust
ddprovide ddRita ddwith dda ddnotification ddadvising ddher ddof ddany ddchange ddin ddthe
ddinterest ddrate:
A ddas ddsoon ddas ddthe ddbank ddbecomes ddaware ddthat ddthey ddare ddchanging ddthe
ddinterest ddrate.
, B ddno ddlater ddthan dd10 ddbusiness dddays ddfollowing dda ddchange ddin ddthe ddECB ddrefi
ddrate.
C ddat ddleast dd20 ddbusiness dddays ddin ddadvance ddof ddany ddinterest ddrate ddchange.
D ddat ddleast dd30 dddays ddin ddadvance ddof ddany ddinterest ddrate ddchange. dd- ddAnswer
ddD
2.12 ddHousing ddLoan ddInterest ddRates
What ddfactor(s) dddetermine ddhow dda ddmortgage ddlender ddcalculates ddtheir ddvariable
ddmortgage ddinterest ddrates?
(i) ddCost ddof ddfunds.(ii) ddCompetition ddin ddthe ddmarket ddplace. dd(iii) ddProfit ddmargin.
A dd(i) ddonly.
B dd(i) ddand dd(ii) ddonly.
C dd(i) ddand dd(iii) ddonly.
D dd(i), dd(ii) ddand dd(iii) dd- ddAnswer ddD
2.11.1 dd- ddStandard ddVariable ddRate
Why ddmight dda ddfixed ddrate ddmortgage ddbe ddthe ddMOST ddsuitable ddmortgage ddfor
dda ddfirst ddtime ddbuyer?
A ddLenders ddoffer ddhigher ddLoans ddto ddValue dd(LTV) ddfor ddfixed ddrate ddmortgages
ddthan ddfor ddvariable ddrate ddmortgages.
B ddFixed ddrate ddborrowers ddare ddnot ddusually ddrequired ddto ddtake ddout ddmortgage
ddprotection ddcover.
C ddThe ddborrower ddcan ddget dda ddhigher ddrate ddof ddmortgage ddinterest ddtax ddrelief.
D ddThe ddrepayments ddare ddguaranteed ddnot ddto ddincrease ddduring ddthe ddfix ddperiod,
ddoffering ddthe ddborrower ddstability. dd- ddAnswer ddD
2.11.3 dd- ddFixed ddRate
Where dda ddlender ddintends ddto ddcharge dda ddredemption ddfee, ddit ddis ddrequired ddto
ddprovide ddto ddthe ddborrower ddwith:
(i) dda ddcopy ddof ddthe ddloan ddoffer.
(ii) dda ddworked ddexample ddof ddthe ddredemption ddcharge ddspecific ddto ddtheir
ddcircumstances.
(iii) dddetails ddon ddhow ddthe ddcharge ddis ddcalculated.
A dd(i) ddonly.
B dd(i) ddand dd(ii) ddonly.
C dd(ii) ddand dd(iii) ddonly.
D dd(i), dd(ii) ddand dd(iii). dd- ddAnswer ddC
2.11.3 dd- ddFixed ddRate
A ddwayleave ddis:
A dda ddcovenant ddprohibiting dda ddbusiness ddto ddbe ddcarried ddout ddwithin dda
ddpremises.
QUESTIONS WITH ACTUAL SOLUTIONS
A ddlender ddgenerally ddcharges dda ddlower ddinterest ddrate ddon dda ddhousing ddloan
ddbecause:
A ddthe ddloan ddis ddsecured ddagainst ddthe ddproperty.
B ddthey ddare ddrequired ddto dddo ddso ddby ddthe ddConsumer
Credit ddAct, dd1995.
C ddthe ddloan ddis ddunsecured.
D ddthey ddare ddrequired ddto dddo ddso ddby ddthe ddConsumer ddProtection ddCode. dd-
ddAnswer ddA
1.2 dd- ddIndividual ddLoan ddNeeds
Finn ddbuys dda ddcar ddby ddtaking ddout dda ddPersonal ddPayment ddPlan dd(PPP). ddWhen
ddwill ddFinn ddbe ddthe ddlegal ddowner ddof ddthe ddcar?
A ddAs ddsoon ddas ddthe ddcontract ddis ddsigned.
B ddAfter ddhe ddpays ddan ddinitial dddeposit.
C ddWhen ddthe ddfinal ddpayment ddhas ddbeen ddmade.
D ddWhen dd50% ddof ddall ddpayments ddhave ddbeen ddmade. dd- ddAnswer ddC
1.2.1 ddDifferent ddforms ddof ddLoans
To ddwhich ddof ddthe ddfollowing ddconsumers dddo ddthe ddprovisions ddof ddthe ddConsumer
ddProtection ddCode, dd2012 ddNOT ddapply?
A ddJanet, ddwho ddhas ddborrowed dd€10,000 ddas dda ddpersonal ddloan ddfrom ddClear
ddBank.
B ddJennifer, ddwho ddhas ddengaged ddthe ddservices ddof dda ddDebt ddManagement ddfirm
ddto ddact ddon ddher ddbehalf ddwith ddher ddcreditors.
C ddRoss, ddwho ddhas ddtaken ddout dda ddlife ddassurance ddpolicy ddwith ddhis ddlocal
ddCredit ddUnion.
D ddJames, ddwho ddhas ddreceived ddfinance ddunder dda ddhire-purchase ddagreement. dd-
ddAnswer ddD
1.6.2 ddConsumer ddProtection ddCode, dd2012
Mary ddreferred dda ddcomplaint ddshe ddhad ddmade ddabout ddDelta ddBank ddto ddthe
ddFinancial ddServices ddand ddPensions ddOmbudsman dd(FSPO) ddas ddshe ddwas
ddunhappy ddwith ddtheir ddfinal ddresponse. ddThe ddFSPO ddupheld ddMary's ddcomplaint
,ddand ddawarded ddher ddcompensation ddof dd€50,000. ddDelta ddBank ddwish ddto ddappeal
ddthe ddFSPO's dddecision.
Within ddhow ddmany dddays ddof ddthe ddFSPO's dddecision ddmust ddDelta ddBank ddsubmit
ddtheir ddappeal ddto ddthe ddHigh ddCourt?
A dd15 dddays
B dd20 dddays
C dd30 dddays
D dd35 dddays dd- ddAnswer ddD
1.5.3.1 ddFinancial ddServices ddand ddPensions ddComplaints ddProcess
Which ddof ddthe ddfollowing ddis ddnot ddan ddelement ddof dda ddvalid ddcontract?
A ddConsideration
B ddAcceptance
C ddVerification
D ddCapacity dd- ddAnswer ddC
1.7.1 ddEssential ddElements ddof dda ddValid ddContract
Philip ddagrees ddto ddoffer ddWest ddBank ddcollateral ddsecurity ddagainst dda ddhousing
ddloan. ddThis ddmost ddlikely ddmeans ddthat ddPhilip ddis ddproviding:
A dda ddthird ddparty, ddwho ddwill ddagree ddto ddmake ddthe ddloan ddrepayments ddif ddhe
dddefaults ddon ddhis ddloan.
B dda ddlegal ddmortgage ddover ddthe ddfreehold ddproperty.
C dda ddpersonal ddcovenant ddto ddrepay ddthe ddloan.
D ddan ddassignment ddof dda ddhome ddcontents ddinsurance ddpolicy. dd- ddAnswer ddA
2.4 dd- ddSecurity ddfor ddHousing ddLoans
In ddthe ddearly ddyears ddof dda ddloan ddwhich ddis ddarranged ddon dda ddcapital ddand
ddinterest ddbasis, ddthe:
A ddlargest ddpart ddof ddthe ddmonthly ddpayment ddis ddused ddto ddpay ddthe ddinterest
ddcharge.
B ddcapital ddportion ddreduces ddquickly.
C ddinterest ddportion ddis ddsuspended.
D ddlargest ddpart ddof ddthe ddmonthly ddpayment ddis ddused ddto ddpay ddoff ddthe ddcapital
ddsum ddborrowed. dd- ddAnswer ddA
2.10.1 dd- ddCapital ddand ddinterest
Rita ddholds dda ddvariable ddrate ddmortgage ddwith ddBeta ddBank. ddBeta ddBank ddmust
ddprovide ddRita ddwith dda ddnotification ddadvising ddher ddof ddany ddchange ddin ddthe
ddinterest ddrate:
A ddas ddsoon ddas ddthe ddbank ddbecomes ddaware ddthat ddthey ddare ddchanging ddthe
ddinterest ddrate.
, B ddno ddlater ddthan dd10 ddbusiness dddays ddfollowing dda ddchange ddin ddthe ddECB ddrefi
ddrate.
C ddat ddleast dd20 ddbusiness dddays ddin ddadvance ddof ddany ddinterest ddrate ddchange.
D ddat ddleast dd30 dddays ddin ddadvance ddof ddany ddinterest ddrate ddchange. dd- ddAnswer
ddD
2.12 ddHousing ddLoan ddInterest ddRates
What ddfactor(s) dddetermine ddhow dda ddmortgage ddlender ddcalculates ddtheir ddvariable
ddmortgage ddinterest ddrates?
(i) ddCost ddof ddfunds.(ii) ddCompetition ddin ddthe ddmarket ddplace. dd(iii) ddProfit ddmargin.
A dd(i) ddonly.
B dd(i) ddand dd(ii) ddonly.
C dd(i) ddand dd(iii) ddonly.
D dd(i), dd(ii) ddand dd(iii) dd- ddAnswer ddD
2.11.1 dd- ddStandard ddVariable ddRate
Why ddmight dda ddfixed ddrate ddmortgage ddbe ddthe ddMOST ddsuitable ddmortgage ddfor
dda ddfirst ddtime ddbuyer?
A ddLenders ddoffer ddhigher ddLoans ddto ddValue dd(LTV) ddfor ddfixed ddrate ddmortgages
ddthan ddfor ddvariable ddrate ddmortgages.
B ddFixed ddrate ddborrowers ddare ddnot ddusually ddrequired ddto ddtake ddout ddmortgage
ddprotection ddcover.
C ddThe ddborrower ddcan ddget dda ddhigher ddrate ddof ddmortgage ddinterest ddtax ddrelief.
D ddThe ddrepayments ddare ddguaranteed ddnot ddto ddincrease ddduring ddthe ddfix ddperiod,
ddoffering ddthe ddborrower ddstability. dd- ddAnswer ddD
2.11.3 dd- ddFixed ddRate
Where dda ddlender ddintends ddto ddcharge dda ddredemption ddfee, ddit ddis ddrequired ddto
ddprovide ddto ddthe ddborrower ddwith:
(i) dda ddcopy ddof ddthe ddloan ddoffer.
(ii) dda ddworked ddexample ddof ddthe ddredemption ddcharge ddspecific ddto ddtheir
ddcircumstances.
(iii) dddetails ddon ddhow ddthe ddcharge ddis ddcalculated.
A dd(i) ddonly.
B dd(i) ddand dd(ii) ddonly.
C dd(ii) ddand dd(iii) ddonly.
D dd(i), dd(ii) ddand dd(iii). dd- ddAnswer ddC
2.11.3 dd- ddFixed ddRate
A ddwayleave ddis:
A dda ddcovenant ddprohibiting dda ddbusiness ddto ddbe ddcarried ddout ddwithin dda
ddpremises.
