CeMAP MRT2 Debt Consolidation question: Priya consolidate with a 5-year fixed rate

CeMAP MRT2Debt Consolidation

An adviser recommends Priya consolidate with a 5-year fixed rate. She rejects the advice and wants a 2-year tracker from a different lender, still mainly to consolidate debts. What does MCOB allow?

A Nothing further: once advice is rejected the firm must end the relationship because debt consolidation cannot be execution-only
B Execution-only is allowed once she is told, durably or in a recorded statement, it was found unsuitable, and she confirms
C The tracker can be arranged execution-only, but only if she first moves the debts she is consolidating into a debt management plan
D The tracker can be arranged execution-only, but only if she is a high net worth mortgage customer

Show the answer and explanation

Answer: B. Execution-only is allowed once she is told, durably or in a recorded statement, it was found unsuitable, and she confirms

MCOB 4.8A.12R disapplies the 4.8A.7R ban where the customer has rejected advice and wishes to enter into a different contract execution-only. MCOB 4.8A.14R(4) and (5) then require her to be told (clearly, in a durable medium or recorded oral statement) that the firm advised the contract is unsuitable and that she loses the MCOB 4.7A protections, and she must confirm her positive election. The rejected advice and her reasons are recorded (4.8A.18R). The high net worth route is a separate exception, not a condition of this one.

Common mistake

Believing the debt consolidation ban on execution-only has no exceptions.

Practise more MRT2 Debt Consolidation questions

Exam-style questions with worked answers, then full timed mocks. Free to start.

Start practising →

Study note: Debt Consolidation CeMAP MRT2practice questions & mock exams

Related CeMAP MRT2 questions

Noor’s home is worth £200,000. After consolidating debts her mortgage will be £186,000. If prices then fall by 10%, what is her position?Stella takes a £280,000 bridging loan to buy her next home before selling her mortgage-free current home. Interest is 0.75% a month (simple) on the £280,000 advance, rolled up for 6 months, and a 2% arrangement fee is added to the amount owed. Her current home then sells for £310,000 after costs. How much is left after the bridge is repaid?Ruby, 68, needs £60,000 over the next 10 years. Plan 1: take £60,000 now as a lump sum. Plan 2: a drawdown lifetime mortgage taking £30,000 now and £30,000 in 5 years. Both roll up at 6% a year, compounded annually, with no payments. Roughly how much lower is the debt after 10 years under Plan 2?

Build a daily practice habit — a few exam-style questions a day, with worked answers. Free to start.

Start practising →

Original practice material mapped to the published CeMAP MRT2 learning outcomes. Independent, not endorsed by Walbrook (formerly LIBF). Verify figures and rules against current guidance before relying on them.