Advising on mortgages and home finance transactions

The following Financial Services practice note provides comprehensive and up to date legal information covering:

  • Advising on mortgages and home finance transactions
  • Regulated activities—general
  • Background to the regulation of home finance transactions
  • Advising on each of the home finance transactions
  • Regulated mortgage contracts
  • Home reversion plans
  • Home purchase plans
  • Sale and rent back agreements
  • Advising on regulated credit agreements for the acquisition of land
  • Exclusions
  • More...

Advising on mortgages and home finance transactions

Regulated activities—general

The Financial Services and Markets Act 2000 (FSMA 2000) regulates home finance transactions. FSMA 2000, s 19(1) provides that a person (meaning any person, including a body of persons corporate or unincorporate (that is, a natural person, a legal person and, for example, a partnership)) cannot carry on a regulated activity in the UK unless they are an authorised person or exempt. For more information about exemptions relating to the regulated activity of entering into regulated credit agreements as lender, see Exclusions—Exclusions of general applicability below.

For more information about regulated activities, see Practice Note: What are regulated activities?

In accordance with FSMA 2000, s 22, for an activity to constitute a regulated activity, it must be carried out 'by way of business'. According to FCA guidance, whether or not an activity is carried on by way of business will depend on several factors, including the scale of the activity, the degree of continuity, the existence of a commercial element and the nature of the particular regulated activity (see guidance 2.3.3 of the Financial Conduct Authority’s (FCA) Perimeter Guidance Manual (PERG 2.3.3G). (See Practice Note: What does 'by way of business' mean?).

In addition, entering into a consumer hire agreement will only constitute a regulated activity when carried out within the UK. For more information see Practice Note: Territorial scope of the general prohibition.


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