This unit applies to job roles in the finance and mortgage broking industries.

ELEMENT

PERFORMANCE CRITERIA

1. Prepare for settlement

1.1. All pre-settlement conditions of finance approval are confirmed with lender providing funds and the various parties to settlement are communicated with to confirm that documentation and any other settlement issues are in order

1.2. In the case of a second mortgage advance, confirmation is obtained that prior mortgagee has consented to the subsequent mortgage

1.3. Documents are checked to ensure they are correctly executed, witnessed and dated before sending to approving personnel

2. Register securities

2.1. Loan approval is checked for conditions relating to the taking of security

2.2. Party acting for the lender is instructed to liaise with all parties to the settlement and attend settlement

2.3. Securities are registered and stamped in accordance with lender's procedures and relevant legislation with all security actions taken confirmed as correct and complete

3. Arrange for the disbursement of funds

3.1. Drawdown of the funds is arranged by the lender or solicitor acting for the lender

3.2. Funds are disbursed in accordance with the requirements of loan approval and instructions received from the client

3.3. Relevant client correspondence is activated to advise client of disbursement of funds, date of settlement, manner of disbursement and other relevant details

Required skills

communication skills to:

determine and confirm client and lender requirements, using questioning and active listening as required

liaise with others, share information, listen and understand

use language and concepts appropriate to cultural differences

customer service skills such as:

providing appropriate contact with client throughout the settlement procedure

appropriate timing of events in the settlement process

research and analysis for accessing, interpreting and managing complex information and analysing client needs and lender requirements

numeracy and IT skills to:

access and use appropriate loan assessment software, organisational templates plus spreadsheets and databases

access internet information

well-developed literacy skills to:

read and interpret organisational and industry information

proofread documentation

prepare settlement documentation and related documentation

organisational skills, including the ability to plan and sequence work

Required knowledge

current industry codes of practice including:

Consumer Credit Code

Privacy Act

Credit Act

loan application process

organisational current loan products and services, their features and requirements

process of registering security documentation

relevant current legislation and statutory requirements

relevant policies and procedures in regard to:

opening an account

storage

registration

settlement procedures

The Evidence Guide provides advice on assessment and must be read in conjunction with the performance criteria, required skills and knowledge, range statement and the Assessment Guidelines for the Training Package.

Overview of assessment

Critical aspects for assessment and evidence required to demonstrate competency in this unit

Evidence of the ability to:

accurately complete loan settlement tasks and disbursement of funds within agreed timelines as required by the organisation

interpret and comply with relevant legislation, statutory requirements and organisational procedures.

Context of and specific resources for assessment

Assessment must ensure:

competency is demonstrated in the context of the financial services work environment and conditions specified in the range statement either in a relevant workplace or a closely simulated work environment

access to and the use of a range of common office equipment, technology, software and consumables

access to lending product information

access to relevant specialist software and data

Method of assessment

A range of assessment methods should be used to assess practical skills and knowledge. The following examples, in combination, are appropriate for this unit:

evaluating an integrated activity which combines the elements of competency for the unit or a cluster of related units of competency

verbal or written questioning on underpinning knowledge and skills

evaluating samples of work

accessing and validating third party reports.

Guidance information for assessment

The range statement relates to the unit of competency as a whole. It allows for different work environments and situations that may affect performance. Bold italicised wording, if used in the performance criteria, is detailed below. Essential operating conditions that may be present with training and assessment (depending on the work situation, needs of the candidate, accessibility of the item, and local industry and regional contexts) may also be included.

Pre-settlement conditions of finance approval may include:

checking for existence of existing registered company charges and obtaining consent to subsequent charge where appropriate

checking that the original approval has not expired through passage of time (most approvals are only valid for three months, then subject to review)

confirming amount required to discharge other debts or registered encumbrances

gaining consent of prior mortgagee if second mortgage security is being taken

ensuring borrowing parties have verified their identity to avoid fraud

ensuring contracts for the sale of land, including land transfer documents, have been properly executed to ensure the legal transfer of title and are in accordance with the original loan application

lender's interest

obtaining copy of approval to commence development or construction

obtaining copy of signed and stamped lease of property

obtaining copy of signed building contract

obtaining evidence that any necessary independent legal or financial advice has been obtained

obtaining evidence that other undertakings by the borrower have been met such as:

sale and settlement of other property

repayment of other debts

provision of evidence of insurance.

Various parties may include:

parties holding land titles required for registration of documents, including prior mortgagee

parties holding encumbrances that are to be lifted and relodged, discharged or withdrawn:

caveats

warrants

memorials

other forms of encumbrance

solicitors or settlement agents arranging the transfer of land

parties whose existing mortgages or company charges are to be discharged.

Documentation may include:

Credit Reference Association of Australia (CRAA) authority signed

guarantees

loan contract

periodical payment authority

signed application form.

Settlement issues may require that the broker:

confirm the amounts required by the various parties to the settlement, identify the sources of the funds required to achieve settlement, and confirm availability of the funds in time for the proposed settlement date

ensure arrangements have been made by one or more of the parties to the settlement to ensure that all existing encumbrances, caveats, registered company charges, etc. will be discharged, satisfied or withdrawn at settlement

ensure that there are no arrears of rates or taxes from local authorities or government utilities that, if unpaid, remain as a first ranking charge over the title.

Relevant approving personnel may include:

credit manager

loans approval officer

relationship manager.

Conditions of the loan approval may include:

change of term

amount financed

balloon or residual value initially stated in application

deposit or additional equity in the purchase

insurance over asset mortgaged or financed

loan guarantor

security over debtor assets or asset purchased through the loan.

Settlement may take place:

at the lender's site or another site.

with loans settled by lending organisations such as:

banks

building societies

credit unions

mortgage managers and originators.

Relevant legislation may include:

Chattels and Securities Act

Cheques and Payment Orders Act

codes of practice

Consumer Credit Code

Credit Reference Association of Australia (CRAA)

Electronic Funds Transfer (EFT) Code of Conduct

Financial Institutions (FI) Code

Financial Transaction Reports Act

Privacy Act

prudential legislation.

Methods of funds disbursement may include:

crediting an account

top-up of existing debt

issuing a cheque to third party

issuing a cheque to applicant

marking up a limit

property settlement.

Unit sector

Finance/mortgage broking

This unit contains employability skills.