Consumer buy-to-let lending is regulated by which directive?

Consumer buy-to-let lending is regulated by which directive?

• A. Consumer Credit Directive 2015
• B. Mortgage Credit Directive 2014
• C. Financial Services Act 2012
• D. Data Protection Regulation 2016

Answer: (A)

Lending to a consumer for buy-to-let purposes is treated as consumer credit rather than a residential mortgage regime. The Consumer Credit Directive governs most consumer credit agreements, including loans secured on land where the borrower is an individual acting for personal purposes. Buy-to-let loans fit this category, so lenders must comply with the CCD’s rules on disclosure, contract terms, and responsible lending. The Mortgage Credit Directive focuses on mortgage credit agreements tied to a dwelling that the consumer uses or intends to use as their home, so it generally doesn’t cover typical buy-to-let investments in the same way. The other options aren’t relevant to lending directives: the Financial Services Act is domestic regulation, and the Data Protection Regulation concerns privacy, not lending.

Lending to a consumer for buy-to-let purposes is treated as consumer credit rather than a residential mortgage regime. The Consumer Credit Directive governs most consumer credit agreements, including loans secured on land where the borrower is an individual acting for personal purposes. Buy-to-let loans fit this category, so lenders must comply with the CCD’s rules on disclosure, contract terms, and responsible lending. The Mortgage Credit Directive focuses on mortgage credit agreements tied to a dwelling that the consumer uses or intends to use as their home, so it generally doesn’t cover typical buy-to-let investments in the same way. The other options aren’t relevant to lending directives: the Financial Services Act is domestic regulation, and the Data Protection Regulation concerns privacy, not lending.