Task 2 - Gathering and documenting client information
Complete the Client Information Collection Tool (located at the end of the assignment in Appendix 1) using the information provided in Case Study 1.
Task 3 - Assessing the clients' situation
1. Using theExcel or Online version of the Genworth Serviceability Calculator,calculate the Genworth NDI for the borrowers. This will require you to enter all the data, including their future rental income.
Once you have completed the calculations, copy the data into the Serviceability Calculator (located at the end of this assignment in Appendix 2).
Do not upload the Excel spreadsheet as a separate file.
2. Based on the information provided in the case study and using the tools available to you (e.g. loan calculators, including those available on lenders' websites), provide an assessment of the clients' borrowing ability. Consider and comment on the following issues:
(a) the maximum loan using the Genworth calculator
(b) deposit requirements for the loan required
(c) combined net monthly income, less cost of living expense as specified by the borrower
(d) do they require Lenders Mortgage Insurance (LMI) and if so, how much will it cost?
Refer to Genworth LMI estimator for this figure
(e) any other issues that may impact, now or in the future, on the clients' ability to meet their obligations, including any possible risks.
Provide data to support your comments and conclusions.
(No word count requirement for questions (a) to (d)).
Question (e) (100 words)
Task 11 - Responsible lending obligations
The National Consumer Credit Protection Act 2009 imposes ‘responsible lending' obligations on brokers that must be satisfied by all people arranging loan applications. The primary objective under responsible lending guidelines is that the credit facility offered to the borrower is ‘not unsuitable' for the borrower, meets their requirements and objectives and will not create substantial hardship.
1. How would you define ‘substantial hardship' (detailed information on this subject is found at RG 209 issued by ASIC)?
2. What are the benefits of debt consolidation for Tony and Lorraine? (100 words)
3. Tony and Lorraine have decided to consolidate their debts into one home loan with two splits, one for the existing home loan and a second split for the all other debts. They will not be including the cleaning supplies bill as they pay this in full each month.
In the template below provide a new liabilities summary once Tony and Lorraine have completed the debt consolidation including their new monthly repayments.
Note: They have chosen ‘New Bank Loan' who are offering a 4.5% interest rate on a variable, principal and interest loan over 30 years.
4. What savings will Tony and Lorraine obtain in monthly repayments?
(Include calculation how you determined the savings.)
Attachment:- Finance and Mortgage Broking.rar