Complex Lending and Broking (DFMB2_AS_v1)
Written Assignment
Complex Lending and Broking (DFMB2_AS_v1)
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Before you begin
Read everything in this document before you start your written assignment for the Complex Lending and Broking (DFMB2) subject.
About this document
This document is the written assignment and includes the following:
Instructions for completing and submitting this written assignment
Section 1: Case Study 1 Ray Murdoch and Steve Brown Commercial Equipment Finance
Task 1 Identify the clients complex broking needs
Task 2 Develop complex broking options
Task 3 Implement complex loan structures
Task 4 Detailing analysis findings
Section 2: Case Study 2 Bill Smith and John Jones Commercial Premises Finance
Task 1 Identify the clients complex broking needs
Task 2 Prepare complex broking options
Task 3 Implement complex loan structures
Task 4 Detailing analysis findings
Section 3: Case Study 3 Rahn and Deepa Singh Property Development Finance
Task 1 Identify the clients complex broking needs
Task 2 Prepare complex broking options
Task 3 Implement complex loan structures
Task 4 Detailing analysis findings
Section 4: Short answer questions
Task 1 Complex collateral (specialised security)
Task 2 Complex loan structures
Task 3 Legislation and codes of practice
Section 5: Ethical Decision-making Frameworks and Principals
Task 1 Frame the ethical question applicable to the situation
Task 2 Determine ethical response to the situation
Task 3 Develop implementation plan and carry out ethical response to the situation
Task 4 Evaluate the outcomes of the ethical response
How to use the study plan
We recommend that you use the study plan for this subject to help you manage your time to complete the writtenassignment within your enrolment period. Your study plan is in the KapLearn Complex Lending and Broking (DFMB2v1) subject room.
Instructions for completing and submitting this written assignment
Saving your work
Download this document to your desktop, type your answers in the spaces provided and save your work regularly.
Use the template provided, as other formats will not be accepted for this written assignment.
Name your file as follows: Studentnumber_SubjectCode_Assignment_versionnumber_Submissionnumber (e.g. 12345678_DFMB2_AS_v1_Submission1).
Include your student ID on the first page of the written assignment.
Before you submit your work, please do a spell check and proofread your work to ensure that everything is clear and unambiguous.
The written assignment
The information and data you require to complete this written assignment is presented in the case studies which are located in the subject room.
This written assignment covers complex lending and broking and requires you to answer the questions for all five (5) sections. Each of the three (3) case studies focus on a different lending scenario and must be completed.
Word count
The word count shown in each question is indicative only. You will not be penalised for exceeding the suggested word count. Please do not include additional information which is outside the scope of the question.
Additional research
When completing this assignment, assumptions are permitted although they must not be in conflict with the information provided in the case studies. All assumptions must be noted.
You may be required to conduct your own research in addition to the topic notes provided to source information to answer some of the assignment questions. You may also be required to source additional information from other organisations in the finance industry to find the right products or services to meet your clients requirements to source indicative interest rates and to calculate any fees and charges that may be applicable.
Submitting the written assignment
Only Microsoft Office compatible written assignments submitted in the template file will be accepted for marking by Kaplan Professional Education. You need to saveand submit this entire document.
Do not remove any sections of the document.
Do not save your completed written assignment as a PDF.
The written assignment must be completed before submitting it to Kaplan Professional Education. Incompletewritten assignments will be returned to you unmarked.
The maximum file size is 20MB for the written assignment. Once you submit your written assignment for marking you will be unable tomake any further changes to it.
You are able to submit your written assignment earlier than the deadline if you are confident you have completed all parts and have prepared a quality submission.
Please refer to the Assignment submission/resubmission instructions (pdf) in the Assessment section of KapLearn for details on how to submit your written assignment.
Your written assignment must be submitted on or before your due date. Please check KapLearn for the due date.
The written assignment marking process
You have 12 weeks from the date of your enrolment in this subject to submit your completedassignment.
If you reach the end of your initial enrolment period and have been deemed Not Yet Competent in one or more assessment items, then an additional four (4) weeks will be granted, provided you attempted all assessment tasks during the initial enrolment period.
Your assessor will mark your written assignment and return it to you in the Complex Lending and Broking (DFMB2_v1) subject room inKapLearn under the Assessment tab.
Make a reasonable attempt
You must demonstrate that you have made a reasonable attempt to answer all of the questions in yourwritten assignment. Failure to do so will mean that your assignment will not be accepted for marking; therefore,you will not receive the benefit of feedback on your submission.
If you do not meet these requirements, you will be notified. You will then have until your submission deadline to submit your completed written assignment.
How your written assignment is graded
Assignment tasks are used to determine your competence in demonstrating the required knowledge and/or skills for each subject. As a result, you will be graded as either competent or not yet competent.
Your assessor will follow the below process when marking your written assignment:
Assess your responses to each question, and sub-parts if applicable, and then determine whether you have demonstrated competence in each question.
Determine if, on a holistic basis, your responses to the questions have demonstrated overall competence.
You must be deemed competent in all assessment items in order to be awarded your qualification, including demonstrating competency in:
all of the exam questions
the written and oral assignments.
Not yet demonstrated and resubmissions
Should sections of your assignment be marked as Not yet demonstrated you will be given an additional opportunity to amend your responses so that you can demonstrate your competency to the requiredlevel.
You must address the assessors feedback in your amended responses. You only need amend those sections where the assessor has determined you are Not yet demonstrated.
Make changes to your original submission. Use a different text colour for your resubmission. Yourassessor will be in a better position to gauge the quality and nature of your changes. Ensure you leave your first assessors comments in your assignment, so your second assessor can see the instructions that were originally provided for you. Do not change any comments made by a Kaplanassessor.
Units of competency
This written assignment is your opportunity to demonstrate your competency against these units:
Unit code Unit name DIPMB2 Complex Lending and Broking
FNSFMB512Identify and develop credit options for clients with special financial circumstances Started and completed
FNSFMB513 Present credit options to clients with special financial circumstances Started and completed
FNSFMB514 Implement complex loan structuresStarted and completed
FNSINC504 Apply ethical frameworks and principles to make and act upon decisions Started and completed
Note that the written assignment is required to meet the requirements of the units of competency.
We are here to help
If you have any questions about this written assignment you can post your query at the Ask your Tutor forum in your subject room. You can expect an answer within 24 hours of your posting from one of our technical advisers or student support staff.
Note: Some commercial lenders will not provide interest rate quotes on some commercial products. Oftencommercial lenders add a risk weighted margin to a base lending rate for certain commercial products. Without conducting an analysis and risk score, they tend to be reluctant to provide quoted interest rates over the phone. Forthe purposes of the case studies, conduct online research to ascertain approximate interest rates, loan terms available, fees and charges that usually align to the types of products that would be required to execute the clients transaction. You are allowed to use estimates.
The case studies can be located in the subject room.
Section 1:Case study 1 Ray Murdoch and Steve Brown Commercial Equipment Finance
Task 1 Identify the clients complex broking needs
Business risk can be defined as anything that may impact the financial health of a business, or that could lead to insolvency.
The risk to a business can eventuate for a variety of reasons and can come from internal or external sources. It is your responsibility (as the broker) to understand the clients business, potential risks, their history, experience and business performance. You will also need to understand specific aspects of the transaction such as your clients intended goals, objectives and requirements in purchasing the equipment.
Task 1: Question 1
Prepare a list of questions that you would ask Ray and Steve in order to gather information in preparation of the loan application.
Your questions for Ray and Steve should uncover:
their understanding of the risks and complex nature of purchasing this equipment (e.g. the risk that the investment may not meet the returns they are expecting)
their understanding of the potential risks and benefits/returns associated with financing the equipment purchase
identification of their tolerance of risk in relation to the purchase, damage to equipment during delivery, installation or operations. How would they mitigate these risks?
if they have any specific product and/or product features they require
if they want flexibility in the product to be able to pay it out early or be able to refinance
if they would consider using their own properties as security to provide different lending options
you need to uncover their understanding of their obligation for insurance and maintenance of the equipment etc.
to understand the financial aspects of the transaction (i.e. total costs, installation, other potential premises modifications required to accommodate the machine etc.)
the current financial position of the business.
to ascertain if they have a taxation strategy in regards to the purchase of the equipment
which other professionals will they will consult with and for what purpose?
to understand and/or mitigate any other potential risks you have identified with their situation. Forexample, their experience, background, succession planning, business ownership issues.
(500 words)
Student response to Task 1: Question 1
Answer here
Task 1: Question 2
Assess the special financial needs of Ray and Steve by developing a matrix of key product features that would address those needs, in the following table:
Student response to Task 1: Question 2
Product name Key product features Client financial needs
Chattel mortgage
Lease agreement
Commercial hire purchase
Task 1: Question 3
Consider the client background information you have been provided and present a brief explanation of the most relevant key product features that appear to meet the financial needs of Ray and Steve. Highlight any risks that these product features may present.
Student response to Task 1: Question 3
Answer here
Assessor feedback for Section 1: Task 1 Identify the clients complex broking needs
[insert feedback]
Date assessed: Click here to enter a dateDoes the student need to resubmit? No
Questions that need to be resubmitted First submission Not yet demonstrated
Resubmission Not applicable
To pass this subject, you will need to be assessed as DEMONSTRATED for either your first submission or your resubmission.
Task 2 Develop complex broking options
You are required to prepare a full loan proposal addressed to Ray and Steve outlining available loan options and theapplication process. The proposal must also describe the potential advantages and disadvantages of the financing option that is being recommended.
In a suitable report format, you should prepare the proposal to Ray and Steve, covering the following:
1.The parties to the loan what names will be on the loan contract?
2.Provide two (2) different product options that would meet their needs and objectives outline the product name/type, loan term, interest rate, balloon payment (if applicable), fees and charges and monthly repayments.
3. Provide your recommendation of the best product option to meet their needs. State why the other product was not in their best interest or the best option for them.
4.Name three (3) lenders that offer the product you recommended for their transaction. Advise them about the product type, loan terms that are available, interest rate, balloon payment (if applicable), fees and charges and monthly repayments.
5.Provide a summary of the lenders applicable fees and charges including set up costs and ongoing fees and charges.
6.Advise which relevant disclosures need to be made covering broker remuneration.
7.Outline all security that will be required, including directors guarantees.
8.List the documentation they need to provide to obtain the funding for the machine and to obtain a loan approval.
9.Outline their responsibilities, so they fully understand their obligations regarding the security offered and the equipment during the loan term.
10.Provide details of the financial and transaction risks associated with the new loan of which they should be made aware. For example, what would happen if they could no longer service the debt?
11.They enquired about claiming back the GST that is included in the purchase price of the machine. You also feel that they may be able to utilise Small Business Asset Instant asset write-off benefits. In accordance with your qualification as a mortgage broker, what should you advise them to do regarding their question on claiming back GST?
12.Invite them to ask you any questions they may have about the transaction.
13.Provide an instruction for them to advise you to proceed with the application on their behalf.
(800 words)
Notes: Any assumptions you make should be listed, and not be in conflict with the case study information already provided.
You are to write a loan proposal to your clients, demonstrating your professional writing skill not simply commenting on each of the points detailed above.
Your proposal should be supported by evidence-based statements and not contain opinion-based commentary.
The use of tables in the report to set out some of the numeric information may be of benefit.
Use an Upfront commission at 0.66% and trail of 0.165% which includes GST
Student response to Task 2
Answer here
Assessor feedback for Section 1: Task 2 Develop complex broking options
[insert feedback]
Date assessed: Click here to enter a dateDoes the student need to resubmit? No
Questions that need to be resubmitted First submission Not yet demonstrated
Resubmission Not applicable
To pass this subject, you will need to be assessed as DEMONSTRATED for either your first submission or your resubmission.
Task 3 Implement complex loan structures
Ray and Steve have accepted your recommendations and have given you authority to proceed with their application.
As part of implementing their loan application you are required to prepare a formal written loan submission to the lender for approval.
Note:Lenders have different credit policies and submission requirements which vary from lender to lender.
Your loan submission must include:
1.the details of borrower, guarantors and all contact details
2.the borrower and key personnels background
3.an overview of the proposal what the finance is for how does it benefit the business
4.a funds-to-complete table (cost, deposit etc.) including statutory costs and any relevant fees
5.the proposed structure of the facility being recommended product type, loan amount, term, interest rate, repayments and residual value (if any), pricing (lender fees etc.)
6.cash flow/serviceability calculations using NPAT averaged over two years. Include the current company loan repayments along with the annual interest on the company overdraft calculated at 80% of the limit
7.full details of the security/collateral that is to be provided and whether clients should seek independent legal advice
8.any relevant conditions of approval that the client must meet (if applicable)
9.a description of the relevant risks industry, business, transactional, financial and how they will be mitigated
10.a list of all documents that would be attached to the application
11.any other information that is relevant to assist the lender to provide an approval
12.your comments and recommendations.
(800 words)
Notes: Any assumptions you make should be noted, and not be in conflict with the case study information already provided.
You are to write a formal submission to the lender; not simply commenting on each of the points detailed above.
The use of tables in the report, to set out some of the numeric information, may be of benefit.
Student response to Task 3
Answer here
Credit memorandum
Borrower details:
Name: Answer here
ACN/ABN: Answer here
Directors:
Name/address Answer here
Shareholders:
Name/address/percentage of shareholding Answer here
Principal place of business Answer here
Postcode Answer here
Phone number Answer here Fax number: Answer here
Year established Answer here Industry (if applicable): Answer here
Nature of business activities Answer here Trust
Full name of trust Answer here
Type of trustee Answer here
Company Y / NIndividual Y / N
Name of trustee Answer here
Year established Answer here
Type of trust Answer here
Beneficiaries Answer here
Background
Answer here
Purpose/Loan details/Funding table/Pricing
Answer here
Debt servicing/Sensitivity/Ratios
Answer here
Security details/Exit strategy
Answer here
Conditions precedent
Answer here
Business/Industry/Transaction Risk
Answer here
Attachments to accompany the submission
Answer here
Supporting information and Recommendation
Answer here
Name:
Organisation:
Date:
Assessor feedback for Section 1: Task 3 Implement complex loan structures:
[insert feedback]
Date assessed: Click here to enter a dateDoes the student need to resubmit? No
Questions that need to be resubmitted First submission Not yet demonstrated
Resubmission Not applicable
To pass this subject, you will need to be assessed as DEMONSTRATED for either your first submission or your resubmission.
Task 4 Verification of applicants financial situation
This task requires you to describe the actions that you would take to verify the applicants details and financial situation.
You will need to identify the key verification tasks associated with the financial situation of both individual applicants and related business activities, based on the information set out in the case study.
Task 4: Question 1
(a) Identify and list each of the individuals and/or business entities for which you would require a creditreport.
(b) Name the company that you would use to access this information and explain what you require from the client, in order to gain consent to obtain this information.
(c)Part (b) requires you to obtain appropriate consent to conduct the credit check. What legislation are you complying with by obtaining consent prior to proceeding?
(d)List the information that is provided in the credit report? (Provide six (6) items)
Student response to Task 4: Question 1
(a)Answer here
(b)Answer here
(c)Answer here
(d)Answer here
Task 4: Question 2
(a)What documents do you need to obtain to identify the individuals that are party to this loan?
(b)Name the Legislation that covers this requirement.
Student response to Task 4: Question 2
(a)Answer here
(b) Answer here
Task 4: Question 3
What sources or supporting documentation would you need to obtain in order to verify the financial information disclosed by the client?
Student response to Task 4: Question 3
Answer here
After reviewing the background information and the business details of the applicant, complete the following questions:
Task 4: Question 4
Provide a summary of the impact that the new loan repayments will have on the companys financial position after debt servicing. Assume a projected increase of 50% in net profit based on the Year 20X1 trading results.
Student response to Task 4: Question 4
Answer here
Task 4: Question 5
Based on the background information provided in the case study and assuming an interest rate of 4.5%p.a., a brokerage fee of 2%, a residual value of 30% and a term of 5 years, calculate:
the borrowed amount
the brokerage feemonthly repayments
total of annual repayments
residual amount
total of repayments over term of the loan including residual payment.
Please identify the calculator you have used and show your calculations.
Student response to Task 4: Question 5
Answer here
Total amount borrowed Monthly repayments Total annual amount of repayments Residual amount Total of repayments over the loan term (include the residual payment) Brokerage fee Task 4: Question 6
(a)Refer to Task 2 and list the two security instruments to be obtained to secure this transaction.
(b)Explain what the impact would be for the directors and the company should the lender call on each of the securities provided.
Student response to Task 4: Question 6
Answer here
(Task 4b questions 1-6, 500 words)
Note: To complete this task you will need to refer to the Toolbox in the sections Pallets-R-Us Pty Ltd and Lending organisations guidelines, policies and procedures, legislative requirements, loan verification and loan standards. You may also need to conduct your own independent research to answer these questions.
Assessor feedback for Section 1: Task 4 Verification of applicants financial situation:
[insert feedback]
Date assessed: Click here to enter a dateDoes the student need to resubmit? No
Questions that need to be resubmitted First submission Not yet demonstrated
Resubmission Not applicable
To pass this subject, you will need to be assessed as DEMONSTRATED for either your first submission or your resubmission.
Section 2: Case Study 2 Bill Smith and John Jones Commercial Premises Finance
The case study is located in the subject room
Task 1 Identify the clients complex broking needs
It is the brokers responsibility to understand the clients business, potential risks, their history, experience and business performance. You will also need to understand specific aspects of the transaction such as the clients intended goals, objectives and requirements in purchasing the property.
1. Prepare a list of questions that you would ask Bill and John in order to gather information in preparation of the loan application for their commercial property purchase.
Your questions to Bill and John should uncover the following areas:
the reasons behind the complex trust structure they have chosen particularly with the shareholder involvement and their willingness to be involved in the transaction with the lender
the benefits and risks with this property purchase
their risk tolerance with different product types (i.e. fixed rates/interest only, term of loan etc.)
the impact this purchase will have on the business and its financial position
anticipated costs to fit out the new premises to suit their business needs
the business structure/key personnel risks
the business and industry risks (e.g. required licencing and professional indemnity).
(200 words)
Student response to Task 1
Answer here
Assessor feedback for Section 2: Task 1 Identify the clients complex broking needs:
[insert feedback]
Date assessed: Click here to enter a dateDoes the student need to resubmit? No
Questions that need to be resubmitted First submission Not yet demonstrated
Resubmission Not applicable
To pass this subject, you will need to be assessed as DEMONSTRATED for either your first submission or your resubmission.
Task 2 Prepare complex broking options
You are required to prepare a full report for Bill and John by outlining the application process and the risks (potentialand real) of which they should be aware. This must be presented in a suitable format that would be sent to the client.
You will be required to outline to the directors the product options available to them and the process that will need to take place for them to complete the new property purchase and establish the loan.
In preparation of researching the product options, you will need to understand the clients situation and what funds will be available between the purchase and the sale settlement as outlined in the case study.
The two (2) product options for the property purchase are as follows:
Option 1: A bridging loan with a term loan following bridging period (post sale settlement)
Option 2: A variable rate term loan (to effect the purchase in 90 days time).
In developing your report, you should cover the following:
1.Who are the parties to the loan, given the Trust involvement
2.Provide Bill and John with two (2) complex loan product options
Option 1: Bridging loan with a term loan to follow the bridging period
Option 2: Variable rate term loan.
3.What are your recommendations of the best loan structure option, including:
the loan amountsecurity/collateral including personal and company guarantees
the loan terman explanation as to why the other option is not as suitable for the clients (include pros and cons and differences in fees and interest etc.)
4.Name three (3) lenders that offer the recommended product option required to facilitate this transaction. Advise the client of the product type, loan term, interest rate, ongoing fees and monthly repayment for each of the lenders.
5.What is the procedure to implement the loan, including the documentation Bill and John are required to provide and the security they need to provide?
6.Outline the risks of which Bill and John should be made aware. Information should cover risks associated with the selected loan products and required security, including guarantees and forms of security required in addition to property.
7.Provide the name of the borrower that will be on the loan contract. Also, what name will go on the Certificate of Title (given the Trust involvement) when it is registered with the Land Titles Office? (This varies from state to state so please advise which state you are from refer to the Toolbox for assistance to conduct your research.)
8.Prepare a full funding description including a summary of fees and charges for the purchase of the property and also the setup costs (e.g. solicitors fees) and the lenders fees and charges. If there is a shortfall of funds, how will this shortfall be covered?
9.The clients enquired about claiming back the GST that is included in the purchase price after settlement. In accordance with your qualification as a mortgage broker, what do you advise the clients to do regarding this question?
10.You request that the client informs you of any questions about the transaction and/or provide instructions for you to proceed.
11.Advise which relevant disclosures need to be made to the client regarding the broker remuneration.
(800 words)
Notes: Any assumptions you make should be listed, and not be in conflict with the case study information already provided.
You are to write a report to clients demonstrating your professional writing skills, not simply commenting on each of the points detailed above.
The use of tables in the report to set out some of the numeric information may be of benefit.
Student response to Task 2
Answer here
Assessor feedback for Section 2: Task 2 Prepare complex broking options:
[insert feedback]
Date assessed: Click here to enter a dateDoes the student need to resubmit? No
Questions that need to be resubmitted First submission Not yet demonstrated
Resubmission Not applicable
To pass this subject, you will need to be assessed as DEMONSTRATED for either your first submission or your resubmission.
Task 3 Implement complex loan structures
Bill and John have accepted your recommendations and have given you authority to proceed with their application.
As part of implementing their loan application you are required to prepare a formal written loan submission to the lender for pre-approval.
Note:Lenders have different templates, therefore, credit policies and submission requirements will vary from lender to lender.
Your loan submission must include:
details of borrower, guarantors and their contact details
what the business does, borrowers backgrounds including directors management ability
an overview of the proposal what the finance is for, the proposed structure and loan recommended, including:
product type
deposit amount (if required)
loan amount
term
interest rate
loan repayments.
a funds-to-complete table, including statutory costs and any relevant fees
debt service cover ratio (DSCR) calculations using information provided in the topic notes and the casestudy
full details of the security being offered
any proposed conditions relating to the loan (e.g. proof of sale of existing premises)
the relevant risks. Include industry, business, transactional, economic and personal and how they can be mitigated
any other information that is relevant to assist the lender provide an approval
a list of the documents that you would attach in your written submission
your comments and recommendations.
(800 words)
Notes: Any assumptions you make should be noted, and should not be in conflict with the case study information already provided.
You are to write a formal submission to the lender, or complete a word document template and copy and paste into the student response box.
Student response to Task 3
Answer here
Credit memorandum
Borrower details
Name: ACN/ABN: Directors:
Name/address Shareholders:
Name/address/percentage of shareholding Principal place of business Postcode Phone number Fax number: Years of operation Industry (if applicable) Nature of business activities Trust
Full Name of Trust Type of Trustee Company Y / N Individual Y / N
Name of Trustee Year established Type of Trust Beneficiaries Background
Answer here
Purpose/loan details/funding table/pricing
Provide a funds-to-complete table, including statutory costs and any relevant fees
Answer here
Security details/Exit strategy
Answer here
Conditions precedent (If no conditions precedent note with N/A)
Answer here
Business/Industry/Transaction Risk
Answer here
Attachments to accompany submission
Answer here
Supporting information & Recommendation
Name:
Organisation:
Date:
Assessor feedback for Section 2: Task 3 Implement complex loan structures:
[insert feedback]
Date assessed: Click here to enter a dateDoes the student need to resubmit? No
Questions that need to be resubmitted First submission Not yet demonstrated
Resubmission Not applicable
To pass this subject, you will need to be assessed as DEMONSTRATED for either your first submission or your resubmission.
Task 4 Verification of Applicants Financial Situation
Commercial/business lending is less prescriptive than consumer lending, therefore the information provided to the lender may seem quite thorough to the broker, yet once the lender receives the loan application, it is likely they will seek further information and clarification.
Task 4: Question 1
(a) Identify a minimum of four (4) areas where the lender may require additional information.
(b) What financial services professionals could you engage if you were not able to answer all of the lenders enquiries?
(c) If you needed to escalate any risks or concerns, who would you engage within your own organisation to assist?
Student response to Task 4: Question 1
(a)Answer here
(b)Answer here
(c)Answer here
Task 4: Question 2
In task 2 you obtained the clients agreement to proceed with the loan application. In accordance with regulation, legislation and codes of practice, where should this information be recorded?
Hint/Tip:
In addition to the topic notes, you may find some information in the Toolbox
Student response to Task 4: Question 2
Answer here
Task 4: Question 3
When identifying commercial borrowers and directors, legislative requirements concerning AML/CTF verifications must be met. What checks would you complete to meet these requirements and what would be two (2) possible impacts if you did not complete these checks.
Student response to Task 4: Question 3
Answer here
Task 4: Question 4
In Task 1 you identified potential risks for Case study 2, Bill Smith and John Jones.
Choose three (3) risks that you identified and develop recommendations on risk management strategies that would help to mitigate these risks.
Student response to Task 4: Question 4
Answer here
Task 4: Question 5
Following your review of the borrowers financial position, compare their current and future outgoing commitments once the new loan is initially in place.
(a) What are the two (2) key impacts/changes to their cashflow?
(b) What is the change in the amount of their outgoing commitments? Demonstrate how you arrived at this figure.
Please note: you are not expected to discuss any GST or taxation implications.
Student response to Task 4: Question 5
(a)Answer here
(b)Answer here
Task 4: Question 6
(a)Refer to Task 3 and list at least two (2) of the security instruments to be used for this transaction.
(b)What would the impacts be for the individuals and/or companies if the lender was to call upon thesecurities?
Student response to Task 4: Question 6
Answer here
Task 4: Question 7
Provide two (2) examples of any legal, financial or other issues that the client should be aware of when applying for credit in the name of a trust for example, additional documentation that may be required, taxation issues or fees.
Hint/Tip:
Refer to the Toolbox for a helpful link about trusts.
Student response to Task 4: Question 7
Answer here
(Task 4 questions 1-7: 500 words)
Notes: To complete this task you will need to refer to the Toolbox and sections True Blue Pty Ltd trading as True Blue Real Estate and Lending organisations guidelines, policies and procedures, Legislative requirements, Loan verification and audit standards document found in the Toolbox. You may also need to conduct your own independent research to answer these questions.
Assessor feedback for Section 2: Task 4 Detailing analysis findings:
[insert feedback]
Date assessed: Click here to enter a dateDoes the student need to resubmit? No
Questions that need to be resubmitted First submission Not yet demonstrated
Resubmission Not applicable
To pass this subject, you will need to be assessed as DEMONSTRATED for either your first submission or your resubmission.
Section 3: Case Study 3 Rahn and Deepa Singh Property Development Finance
The case study can be located in the Subject room
Task 1 Identify the clients complex broking needs
Task 1: Question 1
It is the brokers responsibility to understand the clients business, potential risks, their history, experience and business performance. You will also need to understand specific aspects of the transaction such as their intended goals, objectives and requirements in purchasing the property.
Prepare a list of questions that you would ask Rahn and Deepa in order to gather information in preparation of the loan application for their investment property development.
Your questions should uncover the following areas:
their future goals, employment history, experience in project management, financial position, attitude to risks and the property purchase
the complex features of the proposed construction financing transaction and options for 100% funding
the identification of potential risks involved with construction loans and Rahn and Deepa s tolerance for risk
the financial aspects of the transaction including, progressive payments and cost over-runs
the financial position of the borrowers and their capacity to meet project costs
experience in managing a construction project and whether they intend to use other building specialists or project managers
the customers intention to undertake another project after completion
the customers plans for management of the rental and sale of one unit
if the project exceeds the projected amounts, how would they manage the extra costs.
(800 words)
Student response to Task 1: Question 1
Answer here
Assessor feedback for Section 3: Task 1 Identify the clients complex broking needs:
[insert feedback]
Date assessed: Click here to enter a dateDoes the student need to resubmit? No
Questions that need to be resubmitted First submission Not yet demonstrated
Resubmission Not applicable
To pass this subject, you will need to be assessed as DEMONSTRATED for either your first submission or your resubmission.
Task 2 Prepare complex broking options
You are required to prepare a proposal for Rahn and Deepa outlining the loan approval process and the transaction risks they should be aware of.
Prepare the proposal document, in a suitable format, and explain the consumer loan options available to Rahn and Deepa. Outline the process that will need to take place for them to complete the purchase of the property and construction of the three units.
In developing your report, you should cover the following:
1.Who the parties to the loans are.
2.Provide Rahn and Deepa with two initial loan products that would meet their requirements.
Option 1: Residential home loan secured by the family home to provide the required equity
Option 2: Property development loan to assist with purchase of land and construction.
3.Your recommendation for the best loan structure option for each loan, including:
amounts
security/collateral for each loan
terms
repayment types
LVRs for each loan
explanation why each of the loans are suitable for the clients.
4.Provide Rahn and Deepa with a preliminary assessment, as required under your regulatory responsible lending obligations, outlining the three (3) lenders that provide the product required to facilitate this transaction, and advise the client of the product type, loan term, interest rate, ongoing fees and monthly repayment for each of the products.
5.Describe the procedure, from initial interview to unconditional loan approval, including documentation required from Rahn and Deepa . Ensure you mention the compliance documents you need to complete.
6.Describe the client responsibilities, so Rahn and Deepa understand the facilities being proposed.
7.Outline the risks (potential and real) of which Rahn and Deepa should be made aware of, including using their own home as security.
8.Prepare a full funding description including a summary of fees and charges for the initial purchase of the land through to completion of project. Ensure you include the costs for setup and those of the lender.
9.Prepare a time line for the project detailing payments and where funds will be obtained from.
10.A request for the client to inform you of any questions about the transaction and/or provide an instruction for you to proceed.
11.Advise which relevant disclosures need to be made regarding broker remuneration.
(800 words)
Notes: Any assumptions you make should be listed, and not be in conflict with the case study information already provided.
You are to write a report to clients demonstrating your professional writing skill, not simply commenting on each of the points detailed above.
The use of tables in the report, to set out some of the numeric information, may be of benefit.
Student response to Task 2
Answer here
Customer(s) full name(s) Address Phone and e-mail Proposed finance
Interest rates and repayments may change if the lender changes its interest rate. Lender:
Split 1 Purpose:
Finance amount:
Interest structure:
Interest rate:
Term:
Repayments:
Other features:
Split 2 Purpose:
Finance amount:
Interest structure:
Interest rate:
Term:
Repayments:
Other features:
Total loan amount $
Fees payable by you to us. These fees are payable by you. $
Commission is payable for: Commission payable by: Commission payable to: Reasonable estimate of commission: % of the amount of credit limit shortly after the finance is provided. We estimate this to be $
% per annum of your amount owing from time to time payable monthly. We estimate the largest monthly payment to be $
Assessor feedback for Section 3: Task 2 Prepare complex broking options
[insert feedback]
Date assessed: Click here to enter a dateDoes the student need to resubmit? No
Questions that need to be resubmitted First submission Not yet demonstrated
Resubmission Not applicable
To pass this subject, you will need to be assessed as DEMONSTRATED for either your first submission or your resubmission.
Task 3 Implement complex loan structures
Rahn and Deepa have accepted your recommendations and have given you authority to proceed with their application.
As part of implementing their loan application you are required to prepare a formal written loan submission to the lender for pre-approval.
Note:Lender templates, credit policies and submission requirements vary from lender to lender. For this task, you can use the template called Credit Memorandum (or follow the structure as a guide) and/or any of the other example tables provided in the Toolbox.
Your loan submission must include:
details of borrower and their contact details
borrowers backgrounds including ability to manage project or possible use of building expert
an overview of the proposal what the finance is for the proposed structure and loan recommended. Include:
product types
deposit amount (if required)
loan amounts
terms
interest rates
interest repayments
full details of the security being offered
a funds-to-complete table, include statutory costs and any relevant fees
the loan for the two remaining units (loan amount will be 80% of the completion value)
outline the debt servicing position
the projected rental income
interest only repayments
the security and LVR position
a highlight the relevant risks. Include transactional, economic and personal risks and how they can bemitigated
any other information that is relevant to assist the lender provide an approval
your comments and recommendations
a list of the documents that you would attach in your written submission. (You can assume that youhave all of the necessary approvals for the construction and have obtained a valuation).
(800 words)
Notes: Any assumptions you make should be listed, and not be in conflict with the case study information already provided.
You are to write a formal submission to the lender, or complete a word document template and copy and paste into the student response box.
Student response to Task 3
Answer here
Assessor feedback for Section 3: Task 3 Implement complex loan structures:
[insert feedback]
Date assessed: Click here to enter a dateDoes the student need to resubmit? No
Questions that need to be resubmitted First submission Not yet demonstrated
Resubmission Not applicable
To pass this subject, you will need to be assessed as DEMONSTRATED for either your first submission or your resubmission.
Task 4 Verification of applicants financial situation
When a consumer loan falls under the protection of the National Consumer Credit Protection Act 2009 (NCCP Act), there are disclosure obligations that the broker must abide by.
Assume the following:
Rahn and Deepas loan falls under the NCCP Act.
You are about to provide the client with credit assistance.
You are going to charge them a fee for your service.
Task 4: Question 1
What are the two (2) disclosure documents that you must provide to the client at the initial meeting?
(4 words)
Hint/Tip:
Refer to the Toolbox for a helpful link under the heading Responsible lending obligations
Student response to Task 4: Question 1
Answer here
Task 4: Question 2
In order for you to collect and store client information and conduct a credit check, what document would you need to get signed by the client?
(10 words)
Student response to Task 4: Question 2
Answer here
Task 4: Question 3
Your client has advised you that they are not sure what the term cross-collateralisation means. Explain what cross-collateralisation means to the client.
(50 words)
Hint/Tip:
Refer to the topic notes
Student response to Task 4: Question 3
Answer here
Task 4: Question 4
Given that Rahn and Deepa want to equally own the new property, claim taxation benefits and maintain ownership if one party passes away, how should they register their ownership interest on the Certificate of Title?
(10 words)
Hint/Tip:
Refer to the Toolbox for a helpful link
Student response to Task 4: Question 4
Answer here
Task 4: Question 5
In Task 1 you identified risks that concern Rahn and Deepas property development proposal. From the list of risks you identified, choose two (2) risks and discuss the following, namely:
(a)why you feel it is a risk to the client and/or the lender
(b)if the risk was to eventuate, what could be the potential consequences for the clients and/or the lender
(c) your suggestions for how these risks can be mitigated.
(20 words)
Student response to Task 4: Question 5
(a)Answer here
(b)Answer here
(c)Answer here
Note: You may also need to conduct your own independent research to answer these questions.
Assessor feedback for Section 3: Task 4 Detailing Analysis Findings:
[insert feedback]
Date assessed: Click here to enter a dateDoes the student need to resubmit? No
Questions that need to be resubmitted First submission Not yet demonstrated
Resubmission Not applicable
To pass this subject, you will need to be assessed as DEMONSTRATED for either your first submission or your resubmission.
Section 4: Complex Lending and Broking Identifying, developing, presenting and implementing complex broking options
Task 1 Complex collateral (specialised security)
Task 1: Question 1
(a) Explain what the risks are for a lender with taking rural land as security. Provide one (1) example.
(b) Explain what the risks are for the client with purchasing rural land. Provide one (1) example.
(50 words)
Student response to Task 1: Question 1
(a)Answer here
(b)Answer here
Task 1: Question 2
(a) Some properties are heritage listed. Explain what this means.
(b) Explain one (1) risk for the purchaser with buying a heritage listed property.
(c) Explain one (1) risk for the lender with taking a heritage listed property as security.
(100 words)
Student response to Task 1: Question 2
(a)Answer here
(b)Answer here
(c)Answer here
Task 1: Question 3
Describe the purpose of an Environmental Site Assessment (ESA) and explain the main steps involved in producing an ESA.
(80 words)
Student response to Task 1: Question 3
Answer here
Task 1: Question 4
(a) Explain how an Indigenous Land Use Agreement (ILUA) might assist with the acquisition of land subject to native title.
(b) What is one (1) limitation of an Indigenous Land Use Agreement?
(50 words)
Student response to Task 1: Question 4
(a)Answer here
(b)Answer here
Task 1: Question 5
When borrowing against specialised security, there are often impacts such as additional loan approval processes that are required. Describe two (2) additional processes that may impact a loan application when borrowing against specialised security.
(100 words)
Student response to Task 1: Question 5
Answer here
Assessor feedback for Section 4: Task 1 Complex collateral (specialised security):
[insert feedback]
Date assessed: Click here to enter a dateDoes the student need to resubmit? No
Questions that need to be resubmitted First submission Not yet demonstrated
Resubmission Not applicable
To pass this subject, you will need to be assessed as DEMONSTRATED for either your first submission or your resubmission.
Task 2 Complex loan structures
Task 2: Question 1
(a) List three (3) types of loan transactions that may be considered to be complex loans.
(b)Provide two (2) examples of how a clients application with special financial circumstances (such as offering a specialised property as security or requiring a complex loan structure) might be impacted.
For example, additional requirements made by the lender.
(50 words)
Student response to Task 2: Question 1
(a)Answer here
(b)Answer here
Task 2: Question 2
Explain how lending limits may be impacted for loans secured by rural property.
(100 words)
Hint/Tip:
Refer to your topic notes to answer this question
Student response to Task 2: Question 2
Answer here
Task 2: Question 3
(a)Provide one (1) example of when a client may require a bridging loan.
(b)List and explain two (2) risks for the client when obtaining a bridging loan.
(75 words)
Hint/Tip:
In addition to the topic notes, you may be required to undertake your own research. There is a link provided in the Toolbox.
Student response to Task 2: Question 3
(a)Answer here
(b)Answer here
Task 2: Question 4
(a)Provide one (1) example of when a client may require an equity release product (e.g. reverse mortgage).
(b)What three (3) factors are taken into consideration when determining how much the client can access with this type of lending?
(75 words)
Hint/Tip:
In addition to the topic notes, you may be required to undertake your own research. There is a link provided in the Toolbox.
Student response to Task 2: Question 4
(a)Answer here
(b) Answer here
Task 2: Question 5
List the supporting documentation you would request from a business client that you would need to forward to the lender along with loan application. (List a minimum of four (4))
(20 words)
Student response to Task 2: Question 5
Answer here
Task 2: Question 6
(a)As a broker you can assist the client and the lender with the loan implementation process. List a minimum of seven (7) steps that you (as the broker) can take to assist with the loan submission, from collection of supporting documentation through to the collection of fees and settlement or loan draw down.
(b)What steps can you take to ensure the privacy of your clients information when sending and storing their supporting documents and loan application details?
(100 words)
Hint/Tip:
Refer to your topic notes for the suggested Implementation steps
Student response to Task 2: Question 6
(a)Answer here
(b) Answer here
Task 2: Question 7
The implementation process can take time, organisation and require follow up. This part of the process is vital for cementing the relationship with both the client and lender.
What time management tools and techniques can you use to support the implementation process to ensure it runs smoothly and is completed on time for your client and the lender? (Provide at least two (2))
(20 words)
Hint/Tip:
Refer to the Toolbox for a helpful link.
Student response to Task 2: Question 7
Answer here
Assessor feedback for Section 4: Task 2 Complex loan structures:
[insert feedback]
Date assessed: Click here to enter a dateDoes the student need to resubmit? No
Questions that need to be resubmitted First submission Not yet demonstrated
Resubmission Not applicable
To pass this subject, you will need to be assessed as DEMONSTRATED for either your first submission or your resubmission.
Task 3 Legislation and codes of practice
Task 3: Question 1
(a)Identify the Legislation that amends the National Credit Code, which provides negative equity protection for reverse mortgage borrowers.
(b)Explain what protection is provided to those consumers.
Student response to Task 3: Question 1
(a)Answer here
(b) Answer here
Task 3: Question 2
Briefly describe what a finance and mortgage brokers obligations are under best interests duty.
Hint/Tip:
Refer to the Toolbox
(40 words)
Student response to Task 3: Question 2
Answer here
Task 3: Question 3
Write an email to a client outlining the complaints resolution process in accordance with the Australian Financial Complaints Authority (AFCA). (Ensure that you outline what AFCA encourages clients to do before making a complaint to them.)
(100 words)
Hint/Tip:
Refer to the Toolbox for a link to AFCA.
The purpose of this task is to communicate the complaints resolution process to the client. Therefore, it is important that your response is in an email format.
Student response to Task 3: Question 3
Answer here
Assessor feedback for Section 4: Task 3 Legislation and codes of practice:
[insert feedback]
Date assessed: Click here to enter a dateDoes the student need to resubmit? No
Questions that need to be resubmitted First submission Not yet demonstrated
Resubmission Not applicable
To pass this subject, you will need to be assessed as DEMONSTRATED for either your first submission or your resubmission.
Section 5: Ethical decision-making frameworks and principles
Before you begin this Topic, you will be required to read the case study which is located in the subject room.
Task 1 Frame the ethical question applicable to the situation
Task 1: Question 1
Investigate whether the assumptions and client advice provided by the broker in Scenario A, align with industry practice.
(50 words)
Student response to Task 1: Question 1
Answer here
Task 1: Question 2
Identify the two (2) ethical principles that arise in each of the three (3) scenarios from the case study and list them in the table below.
Student response to Task 1: Question 2
Answer here
Issue Identified
Example: The broker submitted false information.
Scenario A
Scenario B
Scenario C
Task 1: Question 3
The lender in Scenario A became aware of the brokers instructions to the clients and advised the broker that his actions were not acceptable.
In their defence, the broker stated that they had, heard that this was the right thing to do at a professional development day that I attended in the past and that I confirmed this by asking other brokers who agreed with my actions.
Identify at least two biases that are revealed in the statements made by the broker and explain how they might impact the brokers understanding of the situation.
(50 words)
Student response to Task 1: Question 3
Answer here
Task 1: Question 4
Explain what regulatory requirements may be breached if the situation in Scenario B was not addressed?
(20 words)
Student response to Task 1: Question 4
Answer here
Task 1: Question 5
Many organisations have a vision and/or mission statement and a set of values that are visible on their website to the public and their clients.
The ethical situation that arises in Scenario B has the potential to be in conflict a lenders purpose andvalues.
Identify two (2) examples where the situation in Scenario B could be in conflict with an organisations strategy, purpose and/or values.
Hint/Tip:
For this task you may use Westpacs Strategy and Purpose. A link has been provided and can be located in the Toolbox.
(20 words)
Student response to Task 1: Question 5
Answer here
Task 1: Question 6
Scenario B resulted in the clients lodging a complaint with the Australian Financial Complaints Authority, (AFCA), against both the lender and the broker.
Evaluate the possible impact on the lenders reputation if the action of cancelling the loan became known in the public domain. Explain how the organisation at fault could be impacted.
(50 words)
Student response to Task 1: Question 6
Answer here
Assessor feedback for Section 5: Task 1 Frame the ethical question applicable to the situation:
[insert feedback]
Date assessed: Click here to enter a dateDoes the student need to resubmit? No
Questions that need to be resubmitted First submission Not yet demonstrated
Resubmission Not applicable
To pass this subject, you will need to be assessed as DEMONSTRATED for either your first submission or your resubmission.
Task 2 Determine ethical response to the situation
Task 2: Question 1
Scenario A resulted in the clients defaulting on their home loan 12 months after settlement as it took them several months to find new employment. Each party to the transaction claimed that they received poor advice from the broker.
Identify the key stakeholders (parties) and analyse what is at stake for each of them.
(100 words)
Student response to Task 2: Question 1
Answer here
Task 2: Question 2
You have been asked to determine an ethical response to Scenario B. You are required to analyse the situation using the RADAR ethical decision-making framework. Your response must include commentary on each aspect of this framework as follows:-
Recognising the eventAssessing the situationDeciding what to doAgreeing the way forwardReporting
(150 words)
Hint/Tip:
The framework can be located in your Topic notes and a helpful link is also provided in the Toolbox.
Student response to Task 2: Question 2
Answer here
Task 2: Question 3
The broker in Scenario A was interviewed about his actions and made the following comments:
Most of my business is settled with this particular lender and the loans manager is a personal friend of mine. There is nothing unusual about the way I handled this situation. Im not that comfortable dealing with clients this way, but its the way brokers operate. I know this is true because my mentor didnt see anything wrong by not notifying the lender.
Identify the situational and/or psychological barriers that may have impeded the brokers response to this ethical situation by listing a minimum of two (2) examples of conflict of interest and at least two (2) examples of where the brokers views were biased.
(50 words)
Student response to Task 2: Question 3
Answer here
Conflicts of Interest:
Biased views:
Task 2: Question 4
You have been asked to determine an ethical response to Scenario A having now heard what the broker has had to say about his actions at question 2.3 above. Name at least two (2) people or organisations you might seek guidance from as you would consider them to be ethical advisers.
(10 words)
Student response to Task 2: Question 4
Answer here
Trusted ethical advisers:
Task 2: Question 5
Describe the strategies and processes you would formulate for responding to the situational and psychological barriers you identified in Question 2.3 above.
(80 words)
Student response to Task 2: Question 5
Answer here
Situational Barriers Strategies Processes
Psychological Barriers
Assessor feedback for Section 5: Task 2 Determine ethical response to the situation:
[insert feedback]
Date assessed: Click here to enter a dateDoes the student need to resubmit? No
Questions that need to be resubmitted First submission Not yet demonstrated
Resubmission Not applicable
To pass this subject, you will need to be assessed as DEMONSTRATED for either your first submission or your resubmission.
Task 3 Develop implementation plan and carry out ethical response to the situation
As the compliance manager for the lender, you have been asked to implement an ethical response to Scenario B in order to set out what conduct is expected across the broker network.
Important:
Although you will need to consider the ethical situation described in Scenario B, the focus of your response to the following questions needs to be on developing a plan to implement changes within the lender organisation and the broker network. You are required to develop an implementation plan, as follows:
Task 3: Question 1
Identify:
(a)what data needs to be gathered.
(b)which parties you will need to communicate with
(c)the sequence of the steps that you will take to complete these tasks.
(75 words)
Student response to Task 3: Question 1
Answer here
Task 3: Question 2
Identify a minimum of three (3) examples of reasoning or rationalisation that may be encountered by someone speaking up on ethical issues and suggest how you would respond to those behaviours.
(25 words)
Student response to Task 3: Question 2
Answer here
Reasoning/Rationalisation Appropriate Response
Task 3: Question 3
As stakeholders may be impacted by an ethical response, it is important to manage stakeholder risks and concerns that might arise during this process.
(a) Identify the four (4) steps in the stakeholder risk management process and outline the key objectives of each step in the table below.
(b)Describe the communication strategies that you would use to ensure that the risks are mitigaged and that your stakeholders concerns are acknowledged.
(50 words)
Hint/Tip:
Refer to your Topic notes.
Student response to Task 3: Question 3
(a)Answer here
Process: Stakeholder Risks Management Steps Key objectives:
(b)Answer here
Task 3: Question 4
(a)Under what circumstances would you seek support from a trusted colleague in order to effectively carry out the ethical response? Provide three (3) examples in the table below.
(b)Under what circumstances would you act independently in order to effectively carry out the ethical response? Provide a minimum of three (3) in the table below.
(20 words)
Student response to Task 3: Question 4
Seek Support from a Trusted Colleague:
(a)
Act Independently:
(b)
Assessor feedback for Section 5: Task 3 Develop implementation plan and carry out ethical response to the situation:
[insert feedback]
Date assessed: Click here to enter a dateDoes the student need to resubmit? No
Questions that need to be resubmitted First submission Not yet demonstrated
Resubmission Not applicable
To pass this subject, you will need to be assessed as DEMONSTRATED for either your first submission or your resubmission.
Task 4 Evaluate the outcomes of the ethical response
Case Study:
One of Petas most important customers called yesterday seeking an explanation for the delay in receiving a valuation report for a loan application he had lodged last week. Peta had asked a colleague Alex to order a valuation (normally completed within five days), but it had not arrived.
When Peta asked Alex whether the valuation instructions had been issued, Alex said, I sent them by email to the valuer a week ago. Later, as Peta passed Alexs desk and woke the laptop from the screensaver, Peta could clearly see that the email was sent just two days ago. This was typical of the poor customer service provided by the organisation due to ongoing problems with staff levels and it is not the first time Alex had been dishonest in order to cover up mistakes.
However, Peta knew that Alexs job was at risk and decided the right thing to do was to protect her colleague by calling the client back with the news that the valuer had received the instructions but had not yet completed the valuation report. As Peta talked with the client, she learned that the delay of the valuation had resulted in the loss of the clients opportunity to purchase the property.
Peta later heard from the manager that the client had complained and decided to not use the mortgage broking services provided by the organisation in future. Peta listened carefully when her manager later expressed his confusion on how this clients attitude towards him had been hostile. Peta, knowing that both Alex and her own jobs were now at risk, said nothing in response.
Task 4: Question 1
(a)Identify a minimum of three (3) ethical situations/actions described in the case study.
(b)Evaluate whether the issues were resolved and if other courses of action should have been taken.
(50 words)
Student response to Task 4: Question 1
Answer here
Task 4: Question 2
Determine the consequences for Peta and the other affected parties from the actions she took.
(30 words)
Student response to Task 4: Question 2
Answer here
Task 4: Question 3
Analyse what the outcomes of Petas actions reveal about her own and the organisations values.
(25 words)
Student response to Task 4: Question 3
Answer here
Task 4: Question 4
Identify improved approaches for responding to future ethical situations that might arise from the circumstances described in the case study.
(25 words)
Student response to Task 4: Question 4
Answer here
Assessor feedback for Section 5: Task 4 Evaluate the outcomes of the ethical response:
[insert feedback]
Date assessed: Click here to enter a dateDoes the student need to resubmit? No
Questions that need to be resubmitted First submission Not yet demonstrated
Resubmission Not applicable
To pass this subject, you will need to be assessed as DEMONSTRATED for either your first submission or your resubmission.
Oral Assignment
Audio
Complex Lending and Broking (DFMB2_ORMG_v1)
Student identification (student to complete)
Please complete the fields shaded grey.
Student number Oral assignment result (assessor to complete)
Result first submission Not yet demonstrated
Parts that must be resubmitted
Result resubmission (if applicable) Not applicable
Result summary (assessor to complete)
Time First submission Resubmission (ifrequired)
Preparation for oral assessment Part 1: Instructions N/A N/A
Part 2: Preparation for oral assessment N/A N/A
Oral assessment Part 3: Role play 1 10 minutes Not yet demonstrated
Not applicable
Part 3: Role play 2 10 minutes Not yet demonstrated
Not applicable
Part 3: Role play 3 5 minutes Not yet demonstrated
Not applicable
Total time required 25 minutes Feedback (assessor to complete)
[insert assessor feedback]
Before you begin
Read everything in this document before you start your oral assignment by audio recording.
About this document
This document includes the following parts:
Part 1: Instructions for completing and submitting this oral assignment
Part 2: Preparation for oral assessment
Part 3: Role play (10 minutes)
Role play (10 minutes)
Role play (5 minutes)
How to use the study plan
We recommend that you use the study plan for this subject to help you manage your time to complete theoral assignment within your enrolment period. Your study plan is in the KapLearn Complex Lending and Broking (DFMB2v1) subjectroom.
You will need to start preparing for your oral assignment a few weeks before the written and oral assignment is due.
Part 1: Instructions for completing and submitting thisoral assignment
Completing the oral assignment
For this oral assignment you are required to complete the following tasks:
Part 1: Instructions for completing and submitting this assignment
Part 2: Preparation for oral assessment
Part 3: Role play (10 minutes)
Role play (10 minutes)
Role play (5 minutes)
More information regarding requirements for the oral assignment are provided in the resources in your subject in KapLearn.
Saving your work
Download this document to your desktop, type your answers in the spaces provided and save your workregularly.
Use the template provided, as other formats will not be accepted for these assignments.
Name your file as follows: Studentnumber_SubjectCode_Oral_versionnumber_Submissionnumber(e.g. 12345678_DFMB2_OR_v1_Submission1).
Include your student ID on the first page of the assignment.
Before you submit your work, please do a spell check and proofread your work to ensure that everything is clear and unambiguous.
Submitting the oral assignment
You must submit your completed oral assignment (Word document) in a compatible Microsoft Word document. You need to save and submit this entire document.
Do not remove any sections of the document.
Do not save your completed oral assignment as a PDF.
You will also need to upload an audio recording of your oral assessment.
The oral assignment (in Word) and the audio recording must all be completed before submitting it to Kaplan Professional Education. Incompleteoral assignment documents and/or audio recordings will be returned to you unmarked.
The maximum file size for the written assignment (word document), oral assignment (word document) and audio recording is 20MB. Once you submit your oral assignment and audio recording for marking you will be unable tomake any further changes to it.
You are able to submit your written and oral assignment earlier than the deadline if you are confident you have completed all parts and have prepared a quality submission.
Refer to your study guide so you can plan ahead to complete your audio recording before the written and oral assignment is due.
For more information see the resources in your subject about how to organise and upload your audio recording in KapLearn.
Note: The written assignment (in Word), oral assignment (in Word) and audio recording must all be submitted together.
The oral assignment marking process
You have 12 weeks from the date of your enrolment in this subject to submit your completedoral assignment and audio recording.
If you reach the end of your initial enrolment period and have been deemed Not Yet Demonstrated in one or more assessment items, then an additional four (4) weeks will be granted, provided you attempted all assessment tasks during the initial enrolment period.
Your assessor will mark your assignments and return them to you in the subject room inKapLearn under the Written and Oral Assessment page.
Make a reasonable attempt
You must demonstrate that you have made a reasonable attempt to complete all the parts of your oral assessment. Failure to do so will mean that your oral assignment will not be accepted for marking, thereforeyou will not receive the benefit of feedback on your submission.
If you do not meet these requirements, you will be notified. You will then have until your submission deadline to submit your completed written and oral assessment.
How your oral assignment is graded
Oral assignment tasks are used to determine your competence in demonstrating the required knowledge and/or skills for each subject. As a result, you will be graded as either Demonstrated or Not yet demonstrated for this oral assessment.
Your assessor will follow the below process when marking your oral assignment:
Assess your responses in each part of the oral assessment, and then determine whether you have demonstrated competence in each question or checklist.
Determine if, on a holistic basis, your responses have demonstrated overall competence.
You must be deemed to be demonstrated in all assessment items in order to be awarded the units of competency in this subject including:
all of the exam questions
the written and oral assignment.
Not yet demonstrated and resubmissions
Should parts of your oral assignment be marked as not yet demonstrated you will be given an additional opportunity to amend your responses so that you can demonstrate your competency to the requiredlevel.
You must address the assessors feedback in your amended responses. You only need amend those sections where the assessor has determined the assessment result is Not yet demonstrated.
You may be asked to re-record a part of your audio recording or to answer some written questions in this document. Use a different text colour for any written sections of your resubmission. Yourassessor will be in a better position to gauge the quality and nature of your changes. Ensure you leave your first assessors comments in your oral assignment, so your second assessor can see the instructions that were originally provided for you. Do not change any comments made by a Kaplanassessor.
Units of competency
This oral assignment is your opportunity to demonstrate your competency against these units:
Unit code Unit name DFMB2 Complex Lending and Broking
FNSFMB512Identify and develop credit options with special financial circumstances Started and completed
FNSFMB513Present credit options to clients with special financial circumstancesStarted and completed
FNSFMB514Implement complex loan structuresStarted and completed
FNSINC504Apply ethical frameworks and principles to make and act upon decisions Started and completed
Note that the written and oral assignment is one of two assessments required to meet the requirements of the units of competency.
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Part 2: Preparation for oral assessment
In Part 2, Part 3 and Part 4 of this assignment, you will act as a broker and will be required to make audiorecordings. In preparation for this assessment, it is helpful to prepare a list of resources and equipment you will need for these oral tasks.
Resources List:
Part 3: Role plays
You will participate in three (3) role plays for a maximum of 25 minutes. The role plays will be conducted by audiorecording. You will need a volunteer to assist you in the role plays.
The role plays will include you and a volunteer. You will need to select an appropriate person to be a volunteer, who meets the criteria below:
does not have to be an actor
is not a current or past student of this Kaplan course
can follow instructions
is able to ask questions suggested questions are provided in the Volunteer Guide
will permit you (the student) to complete the oral assessment to the best of your ability.
The volunteer needs to understand that thisis part of your assessment. Provide a copy of the VolunteerGuide in your KapLearn Complex Lending and Broking (DFMB2v1) subject room to your volunteer so they understand what they need to do in your assessment.
You will not be assessed on your acting ability.
You will be assessed on the criteria listed below in the student role.
At the beginning of each recording, ask your volunteer if they give permission to beincluded in the audio recording. The volunteer needs to agree verbally before each recording may continue.
See the resources in your subject in KapLearn to assist you in preparing for your role play.Role play 1: Case study 1 Ray Murdoch and Steve Brown
In Section 1, Task 1 of the written assignment, you compiled a list of questions that you would need to ask the clients at the initial interview. For this task you are to record a 10-minute audio of the interview with the client. Your interview is to cover the following areas:
Introduction:
Introduce yourself and the services you offer.
Demonstrate how you build rapport.
Explain why you need to ask questions and seek clarifications.
Present the client with a Credit Guide.
Explain privacy requirements and how information will be stored to meet legislative requirements.
Briefly outline the dispute resolution process.
Ask questions to identify the clients:
goals and objectives
requirements
situation
level of financial understanding
special needs.
You need to advise the client how you will be remunerated by charging a brokerage fee at 2% of loan amount as well as fees the lender will charge.
Ask questions to confirm that the clients understand the lender fees and brokerage fees and are willing to accept them.
Discuss the difference between a lease and chattel mortgage and provide your opinion on which product may be the best option for them.
Explain why the alternate option is not in their best interest.
Advise the client that they should seek advice from their accountant regarding the best product option that suits their taxation strategy.
Discuss what security will be required for the loan you have recommended.
Explain to the clients the next step in the application process.
Advise the client how you will provide a written recommendation (via email etc).
Ask questions to confirm that the client understands the discussion.
Gain permission to proceed to the next step.
The assessment criteria you will be assessed on includes the following:
Identify goals, objectives and complex broking needs of client.
Develop rapport with clients.
Present broking options to the clients based on financial circumstances, financial literacy, special need.
Negotiate effectively.
Compare features, fees, charges and Risks for credit options.
Complete and maintain necessary documentation.
Obtain written agreement to proceed.
Interpret and comply with legislative requirements.
Assessor checklist role play
Assessor checklist completed after listening to the audio recording of the role play Demonstrated or Not yet demonstrated
1 Identify goals, objectives and complex broking needs of client Not yet demonstrated
2 Develop rapport with clients Not yet demonstrated
3 Present broking options to the clients based on financial circumstances, financial literacy, special need Not yet demonstrated
4 Negotiate effectively Not yet demonstrated
5 Compare features, fees, charges and Risks for credit options Not yet demonstrated
6 Complete and maintain necessary documentation Not yet demonstrated
7 Obtain written agreement to proceed Not yet demonstrated
8 Interpret and comply with legislative requirements Not yet demonstrated
Assessor feedback: Resubmission required?
NoRole play 2: Case study 2 Bill Smith and John Jones
You are required to complete this role play as part of the oral assessment, which should take a maximum of 10 minutes. You should refer to Section 2, Task 2 of the written assignment to assist you with this task.
To set the scene for this role play:
In Section 2, Task 2 you provided Bill and John with a report outlining your recommendations to assist them with their commercial property purchase.
Following the receipt of your written recommendation, Bill has called you to ask some questions regarding the product options and fees.
You will be required to:
clarify the two product options that you recommended
guide the client through both credit options and discuss the impact of each option
Bill also would like you to explain who will be paying the brokerage fee (the client or the lender) and what your association/relationship with the lender is
explain how the lender fees are separate from the brokerage fees
use questioning techniques to clarify that the client understands
confirm that you have the clients permission to proceed.
The assessment criteria you will be assessed on includes the following:
respond to queries from the client
guide client through credit options and discuss the impact on each option
explain fees and commissions
clarify clients understanding
confirm permission to proceed.
Assessor checklist role play
Assessor checklist completed after listening to the audio recording of the role play Demonstrated or Not yet demonstrated
1 Respond to queries from the client Not yet demonstrated
2 Guide client through credit options and discuss the impact on each option Not yet demonstrated
3 Explain fees and commissions Not yet demonstrated
4 Clarify clients understanding Not yet demonstrated
5 Confirm permission to proceed Not yet demonstrated
Assessor feedback: Resubmission required?
NoRole play 3: Case study 3 Rahn and Deepa Singh
You are required to complete this role play as part of the oral assessment, which should take a maximum of five (5) minutes. You should refer to Section 3, Task 2 of the written assignment to assist you with this task.
To set the scene for this role play:
In Section 3 you provided Rahn and Deepa with a loan to purchase a residential property to construct a three unit development.
Following settlement and keeping in line with good customer service practice, you are going to call your clients to debrief with them regarding their experience and address any questions or concerns they may have.
You will be required to:
make a proactive call to Rahn and Deepa Singh
debrief the application and settlement process with them by asking questions, listening and responding appropriately to their experience
answer their questions and respond to their concerns
explain the post-broking service that you will/can provide to the client (e.g. ability to refer them to other specialists, conduct an annual review to check the client is still getting competitive rates/fees).
The assessment criteria you will be assessed on includes the following:
Maintain rapport with the client.
Debrief with client post implementation and address queries and concerns.
Demonstrate communication skills, questioning techniques and listening skills.
Respond to client questions and concerns.
Define post-broking services to be provided and communicate this to the clients.
Assessor checklist role play
Assessor checklist completed after listening to the audio recording of the role play Demonstrated or Not yet demonstrated
1 Maintain and rapport with clients Not yet demonstrated
2 Debrief with client post implementation and address queries and concerns Not yet demonstrated
3 Demonstrate communication skills, questioning techniques and listening skills Not yet demonstrated
4 Respond to client questions and concerns Not yet demonstrated
5 Define post-broking services to be provided and communicate to clients Not yet demonstrated
Assessor feedback: Resubmission required?
No
