Implementation of Complex Loan Structure
1. Relevant legislation
Credit has been considered as the enabling force, which allows business to grow and maintain its performances as required. In this consideration credit can be a source of considerable hardship and despair. Bank and non-bank leads the customers to refer credits to its consumers and is subjected to different numbers which is to commonly overlapping the legal regimes. The main credit legislation included in the Australian Law Regulating Consumer loan and credit are National Consumer Credit Protection Act 2009 (NCCP Act), National Credit Code (NCC), Australian Securities and Investments Commission Act 2001 (ASIC Act) and Australian Consumer Law (ACL). These acts reflects on three types of credit loans which includes home loan, Credit cards and car loans. Some of the features relating to the implementation of complex loan structure are as follows:
- Credit providers (banks, non-banks and credit unions)
- Credit service providers (mortgage brokers and advisers)
- Parties who acts as intermediaries (without being credit service providers and depends on the different business models)
- Representatives (the different parties that act on behalf of the licensee and employees)
National Consumer Credit Protection Act 2009 deals with the following points that will be provided in a table as follows:
|Topic||Person who will be engaged into the caredit activity|
Person who is considered as a credit provider under the credit act
The person who is liable to perform obligations and exercises the rights to provide effective credit providing contracts
|Credit services||The person who provides credit services|
|Consumer leases||The person who is entitled to carry out the business of providing loans to the customers. |
|Mortgages||The person who is a mortgagee under mortgage|
National Credit Code (NCC) informs about the consumer credit law which results under the national consumer credit regime by the National Consumer Credit Protection Act 2009 and is also included in the National Credit Code. This act applies credit on the contracts which has been entered after 1st July 2010 and its processes are as follows:
- The lenders are considered as the providers of the business
- Charge is being maintained to provide the credit (interest)
- Credit is being provided for personal, domestic and investment purposes
Australian Securities and Investments Commission Act 2001 provides different objective powers to the company or an individual who is using the power are as follows:
- Providing functions and powers to the business
- Establishment of takeover panel and exercising functions as per the power that has been provided to the company (Hanlon and Taylor, 2015).
- Ensuring the information is available and is considered to be practicable for the assess for the public concern
Australian Consumer Law has been scheduled to check the trade practices that have been applied to the Commonwealth and state and territory. This deals with the unfair contract terms under consumer contracts. In this context the different features of ACL are as follows:
- Helps in enhancing and enforcing the measures that is available to ACCC and ASIC laws (Hanlon and Taylor, 2015).
- It helps in recommending for the national unfair contract terms law and safety regulations systems
In this context it can be said that the Australian law will help in maintain the performances of the consumers and the business who has taken loan and on these terms works are being performed efficiently and as per the requirement.
2. Complex features of a client situation and needs
Commercial loans: The commercial loan is carried out between the financial institution/bank and the business. The commercial loan is a debt- based funding for a short term of period. The loan is usually taken to fund large capital expenditures in the organisation or to meet the high operational cost which the organisation is not able to afford. The commercial loans are provided to credit worthy business to ensure that it has enough cash flows to repay the loan.
Chattel leases: A Chattel lease is the most common way of borrowing funds to purchase movable personal property like a car. It is a commercial financial product and allows the borrower to get a car financed and repay in regular instalments. The ownership of the vehicle is with the borrower but it is mortgaged with the financial institution/bank until the total amount of loan is repaid. The client/borrower can also opt for balloon re-payment or get its repayments rescheduled.
Native title rights: These are the traditional rights and interest in the land and waters of Aboriginal and Torres Strait Islander people. Under the Native Title Act 1993, the client holding the native title can make an application to the Federal Court and get the tile recognised by the Australian law. Until 1993, the Australian law did not recognise the right of indigenous people. However the NTA in 1993 lays down the procedure to give the natives the title claims. The act has been amended in 1998, followed by changes in 2007 and 2009. The natives are required to prove the title as per the requirements of the act or the tile might get extinguished forever.
Heritage issues: Heritage sites are the building that has been considered culturally important by the government to preserve. These sites are considered special to allow any demolition or change. Thus if the clients property is listed as heritage, the rule to keep it in original state applies. The client doesn’t have much flexibility in renovating or extending the property. The properties are old and thus have the issues of drainage, unsafe chimneys, higher heating cost, etc.
Contaminated sites or properties near noxious industries: Contaminated Sites Act 2003 was introduced to record and identify the combination of the cleaning and maintaining of the sites. These sites are highly polluted and the cost to clean up these sites are very expensive. The lenders are less interested in providing loans for these sites because the resale value of the structures on these sites is low. The people living or working there are also exposed to serious health and safety concerns.
3. Complex nature of securities to be taken
The implication of borrowing against leased premises: If a loan against landlord’s mortgage which can be related to loan from bank, the mortgage will invariably require the owner to get the bank consent before it enters the leasing of the property. In this case landlord who fails to provide notification to the lenders of the total proposed lease which is more than likely to be in a breach of the mortgage. Mortgagee consent is fundamental to the security of the tenant of tenure at the premises. With this consent, lease have the potential to be terminated by the lenders if the landlord becomes a defaulter under the mortgage act. In this context the fee charged by the lenders may range from $150 to $400.
- Multiple securities of different kinds: The different kinds of securities are as follows:
- Equity securities: it is considered to be the shares of a corporation under which a person purchases stock from the company through a broker.
- Debt securities: it is considered to be as a loan which is also known as bond and issued by a company or a country.
- Rural land: Buying rural land under Australian law would need to go through certain points which are as follows:
- Inspection and reports
- Exchanging the contracts
Land transaction may ay an important role by providing land access to those who are productive, but the person who own little or no land. It also allows the exchange of land as the economy of the off-farm develops. The discussion focuses on the permanent transfer of ownership through sales. In this case benefits can also be earned often through informal transactions under rent a markets that is widespread all around the world. In order to address these issues, under which labour and credit may affect the impact of the land markets. There is a possibility of adjusting the imperfection of the markets that depending on the nature of land transfer, temporary or permanent.
- Specialised securities: Specialised securities is the encompassing the securities under which the higher the security needs results in a limited manner. Specialised security is one of the leading and a well-established security and crowd management companies. Under this providing a series of high-quality solution would need to be managed through the country. Specialized security reputation would need to be maintained in an effective
4. Forms of securities to be taken for employee loan structure
The different forms of security are as follows:
Controlling measures and countermeasures must need to be implemented in more than previous types. The controls are not being provided for the purpose of the security but in a different context. The principle of defence are being complemented in depth and needs to be dictated that a security change must need to be as per the security mechanism through the purpose of preventing and compromising. Detecting that the compromise must need to be done underway and needs to be taken into consideration after the forms have been discovered.
written/oral Questions and research task
1. What are the special or complex features of client’s situation that will need to be identified for their implementation implications?
The client would need to work on the following features which incurs:
- Ensuring the information is available and is considered to be practicable for the assess for the public concern
- To take control of the provisions that might be harmful for the consumer
2. What information might you use to prioritise you implementation actions?
Information used for implementation actions: In order to implement the actions certain information can be used. The client situation is important to have knowledge about to take activities effectively. The associated laws in Australia, background of the client and the background of problem needs to be analysed in this procedure.
3. What information do you need to consider when you are planning the timing for each action in your implementation plan so that they are consistent with the needs and specifications of the client?
It would need to be the duty of the consumer to effectively deal with the different necessary working procedures under which the person would be able to provide an effective working criteria and deal with the necessary working procedures. In this case providing credit needs to be the first and foremost point for the company.
4. What information must you consider and include when you are clearly explaining to the client the implementation actions required?
Explanation to clients: The information needed to explain clients about the implementation of actions include the laws associated with the actions, division of the problems and related solutions and the possible future of the action taken.
5. Outline the requirements for obtaining written agreement from the client.
In order to make a written agreement, four basic components need to be considered such as an offer, the legal procedures and laws, the acceptance and the exchange procedure that is usually money. It is useful to develop a legal agreement with the client and every part needs to follow it.
6. Briefly discuss how timing and priority can be used throughout the implementation of actions to maximise advantage for the client.
Application of the timing and priority: In terms of regarding the loan procedure it is required to providethe advantage to the client to a some extent.In terms of recovering the loan amount, the loan provider organisation is required to provide a relaxation of time to the loan borrowers. On the other hand the priority of the client regarding the matter of the amount of money is required to consider by the organisation.
7. What information will you need to include in a brief for identified individuals for the implementation actions for the loan structure?
Information regarding the matter of recovering the loan: In terms of ensuring the matter of recovering the loan, it is required to focus on the matter of the value of the mortgage of against the providing amount. On the other the originality of the documents is red to consider in terms of ensuring the matter of getting back of the invested amount.
8. What are the internal documentation requirements that may need to be completed for the complex loan structure implementation process?
Internal documents for complex loan structure: In Australia, certain documents are needed to implement complex loan structures. It involves manual or computerized application, disclosures, disclaimers, any existing loan documents, insurance information documents, receipts and written suggestions. All these documents can be useful to get a complex loan effectively.
9. Discuss the external document requirements that may need to be completed for a complex loan structure implementation process.
Requirement of the external documents: In terms of operating the process of providing loan it is required to focus on the approach of the external documents. It can be added that and the documents regarding the government rules and regulations can be treated as the external documents.
10. Why is it essential to coordinate any implementation actions that depend on or involve actions by other professionals?
In order to operate the loan providing operations it is required to assess the matter of specifying the actions relating to the matter of maintaining the rules and the regulation of the business process. In terms of recovering the lending money, the management of the loan providing company can take actions in relation to the specific rules and regulation of the government
11. Identify and briefly discuss 3 of the time management techniques and tools that are suitable to use to support the implementation process.
Time management procedures: The time management is important in implementation procedure. One needs to focus on important activities and complete it first that followed by other activities. One needs to minimize any kind of interruption while working. A big task needs to be divided into parts and one need to set time for different parts to complete that contributes to total given time
12. Why is it important to establish monitoring procedures for the critical implementation timing and priorities?
Importance of establishing the monitoring procedures: Effective monitoring procedures reveals the scope of strengthen the implementation in the action plan as well as the timing and priorities. Monitoring is an essential part to establish as it helps in comparing the effective implementations of the actions and legislations. Moreover, it helps in assessing time schedule in critical timing.
13. List 5 of the actions that may need to be taken for the implementation, and that you would need to fully brief a client about.
The different actions that may need to be considered are as follows:
- Providing appropriate working procedures
- Taking necessary decisions
- Caring of the plans that are being done
- Responding to the process
- What assistance might you need to provide to the client throughout the implementation?
It would need to be the duty of the leader to take control of the process and maintain it into its working procedures. This will help the employee to work without any problems and conduct effective working procedures.
14. List 6 of the internal and external personnel you may need to issue instructions to, as per the loan structure.
The different types of external and internal loan structure are:
- Conforming loan
- Secured loan
- Unsecured loan
- Open ended loans
- Close ended loans
- Conventional loan
- Conforming loan
- In what circumstance will you need to maintain consultation and monitoring with other professionals?
It would need to be the duty of the individual to take control of the right maintenance structure that will help in monitoring of the processes and lead up effective working procedures.
15. What types of documentation might you need to follow up on the lodgement of?
The different types of documentation under lodgement are Requirements, Architectural and Technical.
16. What types of fees and charges will you need to obtain and process, according to the organisational and legislative requirements?
Credit card fees $130.00, home loan-$259.00, overdrawn fee-$14.70 and Currency conversion fee 2.98%
17. What range of factors will need to be discussed with the client during the post-implementation debrief?
The definite implications that are dealt with the implementation of the factors majorly deals with: The various institutional factors that are analysed during the credit period of study. This would be ascertained on the basis of the combination of factors like lodgement process, major dealings that are done with reference to the definite set of business prospects.
18. Outline a process that could be followed to address and respond to client concerns.
Good communication can be one of the process in responding a client's concerns. Listening to the customer's concern and responding according to the problem will be a helpful process in attaining the client with full attention
19. Briefly discuss the documentation requirements relating to the following:
Disclaimers - The concept of disclaimer represent the denial of certain aspects for example; responsibility.
Disclosures - Disclosure means the revelation of some secret or unknown fact. It may be said to be the action of declaration.
Insurance policies - Insurance policy is the contract between two entities, an insurer and the insured.
Prospectuses - Prospect is legally documented booklet which consists some kind of information.
Receipts - Receipt is the manifest list or document that is provided as the fact of received.
Written advice - Written advice is the verbal form of suggesting any concept.