Loan Application Procedure

Purpose. This procedure sets the steps from first client contact to settlement for every loan the firm assists with, so that each file meets the Responsible Lending and Best Interests Policy and the lender's requirements.

1.Engagement and disclosure

At first contact the broker must give the client the credit guide, verify identity under the Anti-Money Laundering and Counter-Terrorism Financing Policy and open a file in the Loan Application Pipeline. The client must be told how the broker is paid and about the panel of lenders before any recommendation is made.

2.Needs analysis

The broker must complete the Needs Analysis and Preliminary Assessment Template with the client, recording requirements and objectives in the client's own words, the loan purpose, features that matter to the client, the term, repayment type and any foreseeable changes to circumstances.

3.Verification

The credit analyst must collect and verify identity, income, expenses, assets and liabilities from source documents and a credit report, and must compare declared living expenses with three months of bank statements. Discrepancies must be raised with the client and the outcome recorded. Documents must be stored on the file, not in email.

• Photo identity and second document
• Payslips, tax returns or financial statements
• Three months of bank statements
• Statements for every existing loan and card
• Credit report with client consent
• Evidence of deposit or equity

4.Preliminary assessment and options

The preliminary assessment must be completed and dated before options are presented and must show serviceability at the assessment rate, the loan to value ratio and why the loan is not unsuitable. The broker must compare at least three products from the panel against the client's needs and present the options with the reasons for the recommendation in the credit proposal.

5.Second-person review and submission

Before submission a second broker or the Head of Broking must review the file for completeness, verification, best interests reasoning and disclosure and record the review in the pipeline. The application will then be submitted to the lender with all supporting documents.

6.Approval to settlement

The broker must track conditions, valuations and approvals in the pipeline, explain the loan contract and any conditions to the client, and coordinate with the client's conveyancer or solicitor to settlement. After settlement the broker must confirm the loan is established as approved and close the file with the settlement date.