What does Regulated Mortgage Contract mean?In order to know what a regulated mortgage contract is, one has to fulfill the following conditions:
- You are an individual/trustee eligible to contract a mortgage/loan; within UK only
the decease of the rightful owner. For example, the equity left in your home is £90,000, and your home is worth £210,000.
Upon your death, the house is sold, the lender gets back his amount £90,000 + interests and other charges, and the remainder of the amount goes to the surviving family members (children, grandchildren). Furthermore, a secured credit card loan can also be a regulated mortgage contract, and certain home reversion schemes go under the same umbrella as well.
Total exceptions to this rule are constituted certainly by any unsecured loan, second legal charges (where actually the lender is only second in line of getting paid in case you default on your mortgage payments), and in general any transactions that represent high risk to the lender.