Mortgage Broker Role and Responsibilities

This assignment provides an in-depth analysis of the mortgage broker's role and responsibilities, particularly in relation to the National Credit Code (NCCP) Act. It covers tasks such as verifying client information, ensuring creditworthiness, and checking for any previous credit defaults. The assignment also explains the process of settlement, including fund disbursement and title document registration.

Certificate IV in Finance and Mortgage Broking
Assessment Task
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Assessment
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will not be returned to you as they need to be retained for by us for verification and audit purposes.
Tas
k
Assessments Total
Mark
Pass
Mar
k
Actual
Mark
1 Identify and Interpret Compliance Requirements 27 19
2 Deliver and Monitor a Service to Customers 39 27
3 Contribute to OHS Hazard Identification & Risk Assessment 41 29
4 Manage Personal Work Priorities and Professional Development 24 17
5 Develop and Nurture Relationships with Clients, Other Professionals
and Third Party Referrers
17 12
6 Promoting the Effective Use of Credit 15 10
7 Prepare a Loan Application on Behalf of Mortgage Broking Clients 64 45
8 Steps Taken by the Credit Provider 23 16
Total 250 175

Assessor’s Initials: ____________________
Assessment Date: ____________________

Introduction
Objective The objective of this Assessment Task is to demonstrate that you have the
skills and knowledge required to conduct a client relationship and comply
with statutory, industry and organization compliance requirements.
Elements to be
assessed
To achieve this objective, you will need to demonstrate your ability to:
The assessment tasks in this assessment will allow you to demonstrate your
knowledge and skills in relation to these elements.
Assessment process Start by:
1. Reading the Assessment Task.
2. Type your answers to the assessment tasks into this template
document (hand-written answers are not accepted)
3. Submit your completed document by uploading it on the ‘Ready for
Assessment’ area of www.CPDplus.com
Don’t forget to keep a copy and retain it for 12 months.
Need help? If you have any questions or would like to request a digital copy of this
assessment task, please email the Mentor Support Team at
Statement of
Completion
Upon successful completion of this assessment you will be awarded the
Statement of Completion for FNS40811 Certificate 4 in Finance and
Mortgage Broking.

Task 1: Identify and Interpret Compliance Requirements
1. Identify
compliance
requirements
Mortgage brokers face important compliance requirements, the foremost
among them being the reasonable lending provisions of the NCCP Act. The
penalties for non-compliance include loss of license (for businesses) and
removal from the industry (for individuals). If fraud is involved there may also
be the criminal penalties of fines and / or imprisonment.
Compliance requirements are not static. It is therefore important to stay up to
date with them.
Mortgage brokers also need to keep up-to-date with the actions of the
regulatory authorities such as APRA and the Reserve Bank. Their actions may
not amount to direct regulation, but through their effects on interest rates and
bank lending these authorities can have a very direct impact on the business
mortgage brokers are able to do.
(a) A key requirement of the responsible lending obligations is the ‘unsuitability test.’ What must a
mortgage broker do to comply with the unsuitability test?
No Mark
1. The mortgage broker must ensure that reasonable enquiry has been made about the
requirements and objectives of the borrower.
/1
2. The financial position of borrower must be enquired. /1
3. Verification process of the financial position of the borrower must be made. /1
(b) List the sorts of items a client’s requirements and objectives could include (as indicated by
ASIC).
Mark
The items which client’s requirements and objectives include as per the ASIC are as
follows:
1. The amount of credit required by the borrower
2. Time limit or the loan period.
3. Purpose or objective of the borrower for seeking such loan amount.
/2
(c) Leading credit providers and other financial organizations have code of ethics, sometime called
codes of conduct. Select one of them and summarize it by itemizing its main principles.
Mark
The credit providers and other financial organisations for rendering its credit as well as
financial services has to ensure proper compliance of various code of conducts, ethics,
norms as applicable on it. One of the code is Code to Combat over indebtedness.
This code of conduct focuses on the compliance of provisions related to the minimising or
preventing conditions of over indebtedness or financial distress caused. This code of
/4

conduct provides relief and safeguarding measures in respect of financial difficulties, loss or
risk to the consumers who are seeking services from this credit and financial organisation.
Sub-total /9
Continued
(d) In point form, list the key information that the NCCP Act requires to be contained in a Credit
Guide.
Mark
The credit guide should contain following key information as per the NCCP Act:
1. Name and contact details of Licensee
2. Australian credit license number of Licensee
3. Details and methods for working out any amount of fees payable to the
Licensee by the consumer
4. Details of top 6 lenders which has been introduced to consumers by the
Licensee and Credit Rep
5. Commission which an individual is likely to receive
6. IDRS and EDRS details of the Licensee
7. The Credit Rep's CR number and contact details.
8. Name of CR's top 6 licensees
9. Information related to the CR's IDRS.
/3
(e) It is important to keep up to date with compliance requirements so that the required changes
can be made to organization procedures and product offerings. Suggest three sources that you
can use.
Mark
1) Professional associations such as The Mortgage and Finance Association of
Australia and The Finance Brokers Association of Australia inform their
members of changes to requirements before they happen.
2) The professional associations code of practice can also be used as a sound
guidance for compliance requirements.
3) Large mortgage broking business organisations have compliance officers
assisting practitioners to meet compliance standards.
/3
(f) Explain the requirement for Australian Credit Licensees to keep a training register.
Mark
As per the requirement for Australian Credit Licensees to keep a training register, it
helps the business organisation in tracking the record of training which has been
imparted to the employees by maintaining the training register. The training of
employees is considered as one of the obligations on credit licensees.
/2

(g) Explain APRA’s current attitude towards bank lending for investment properties.
Mark
The Australian Prudential Regulation Authority has introduced restrictions which has
created impact on the bank lending for investment purposes. The banks attitude to the
APRA changes includes
1. changing in the serviceability requirements for the investor loans.
2. Creating difficultly for investors in seeking financial assistance.
3. The borrowing capacity has been downsized, charges high interest rates and
repayments of existing debt are assessed at higher rate.
/2
Sub-total /
10
Continued
Task 1: Identify and Interpret Compliance Requirements Continued
1.2
Interpret,
analyse
and
prioritise
identified
complian
ce
requirem
ents
Some of the compliance requirements are difficult to meet. Unfortunately, also there
have been some ‘rogue’ mortgage brokers who have failed to comply – to the
disadvantage of their clients.
The finance planning industry has been plagued by non-compliance in the largest
planning groups, with the image of the industry being substantially tarnished as a
result. It may not suffer greatly because of the absence of an alternative source of
financial advice.
This is not so with mortgage brokers. They are just establishing their reputation and
consumers always have alternative of going to the lenders directly.
(a) Select three tasks you perform on a regular basis that are subject to compliance requirements.
No Mark
1. Finding lender institution. /1
2. Completing the loan application. /1
3. Submission of the loan application to the bank & getting approval of it. /1
(b) Identify the compliance requirements that are relevant to the three tasks selected, indicating the
name of the relevant legislation, regulation or code of conduct.
No
1. Australian Consumer Law /1
2. ASIC /1
3. The National Consumer Credit Protection Act 2009 /1

(c) How does your organisation monitor your compliance?
Mark
The business organisation should always ensures the compliance of its applicable rules and
regulations in the following manner:
1. By monitoring the pre activity approvals lists or transaction checklist with capturing
of data or relevant information. For effective monitoring of business operations'
compliance, company should gather or collect data and evaluates the factors which
is leading to non compliance.
2. Company should have a proper and effective internal control system which can
rapidly provide solutions and remedies to those risk or issues which have been
identified related to the breach of laws or leading to non compliance of rules and
regulations.
3. Company should make sound and effective plan and strategies to monitor and
evaluate whether the company is complying with its applicable norms or not.
/2
Sub-total /8
Total /27
Task 2: Deliver and Monitor a Service to Customers
2.
Identify
customer
needs
The relationship with a client is generally described as beginning with the
establishment of empathy. In other words, it is first necessary for a mortgage broker
to establish that he / she is truly interested in the client and the client’s needs. It is
only after that that the mortgage broker has established the right to interview a
client.
(a) Use the internet or any other source to find a definition of empathy.
Mark
The word Empathy basically means the ability or skill of understanding, identifying as
well as sharing the feelings of another. Empathy is considered as the ability of sensing or
determining the emotions and feelings of the other people. This process is coupled with
the ability to imagine what other might be thinking or feeling. Thus, empathy is the
capacity to understand, determine or feel what another person is experiencing from a
given frame of reference by placing oneself into the another position. The types of
empathy include cognitive empathy, emotional empathy and somatic empathy.
/1
(b) List three open-ended questions that assist in developing empathy with a client? How do such
questions indicate empathy?
No. Mark
1. How do you deal or overcome with the negative emotions arising?
2. Where do you experience more positivity or feel most present ? And what
other understands about you ?
3. What things in other motivates or encourages you the most ?
/2

The above questionnaire is designed in the open ended form so as to encourage the
full as well as meaningful answer by making use of the own knowledge related to
the subject matter and feelings.
/1
(c) List and explain the steps involved in an ‘active listening approach’.
Mark
A Good listener is a person who is interested in the listening about what is going in
the lives of other people, their hobbies or any other life related activities to them.
The attention of person goes there who says or do something in an attentive
manner.
1
The steps involved in an active listening approach are as follows:
1. Hearing - At this stage listener always pays attention by making eye contact to
make sure proper hearing of the words being said by other.
2. Interpretation – What words has been heard, always make sure correct and
relevant interpretation is done so as to ensure that there is no misunderstanding or
confusion related to basic meanings.
/1
3. Evaluation – After making interpretation, the evaluation has to be made by deciding
what to do with the available information and data on receiving it.
4. Respond - The final stage of listening is to give either a verbal or visual response to the
speaker so as to confirm that information has been understood which has been said by
them.
/1
(d) How is client service commonly monitored in your organisation? What are the two possible
outcomes?
No
.
Mark
1. The client service in a business organisation can be monitored with the help of
following mechanisms:
By capturing customer feedback channels and scheduling meetings on weekly basis
with the customer service staff.
/1
2. BY conducting such process, company is able to assess its service quality and
demand for its product among customer and in the market as well. It will help
company in measuring its performance as well as profitability level and measures it
any, to required to be taken for improving the business operations. This will help in
framing budget and different business strategies and plans which will work towards
attainment of organizational goals and objectives.
/2
Sub-total /10
Continued
Task 2: Deliver and Monitor a Service to Customers Continued

2.1
Deliver a
service to
customer
s
In a survey on the reasons for referrals conducted by David Maister, only 10%
were due to the quality of technical work. The remaining 90% of referrals were due
to the quality of service.
This indicates that the key to maintaining client relationships and gaining referrals
is the provision of outstanding service. This has been described by Maister as
‘over-servicing’.
(a) Describe three ways in which a mortgage broking organisation can attempt to ‘overservice’
clients?
No. Mark
1. Asking the clients for more often time an on the situation of scope creep, the cost
of project is required to be renegotiated.
/1
2. Investing in the business tools and automation like job management solutions,
benchmarks etc. which will help in tracking and monitoring the results.
/1
3. On opportunity showcasing work efforts, then it is better to invest time by
entering into the industry awards.
/1
(b) How would you keep a client informed about the progress of an application as it passed through
a creditor provider’s hands? What approximate timing might be involved?
No. Mark
1. After submission of the Loan application to lender, the mortgage broker is once
again involved for ensuring the product being offered by the lender is complying
with all the requirements of the clients. Mortgage brokers should have contact
with the client and are responsible for breaches of lending provisions of the
NCCP Act.
Mortgage broker is also required to prepare the client or borrowers with the
contract so that they can understand their obligations relating to repayments and
conditions of late repayment, redraw facilities and all late fees and brokerage that
will be applied.
/2
2. The time period between client assessment and forwarding of the loan application
to the credit provider should not be longer than two days. It is important that the
information should be passed on to the credit provider in a timely manner.
/2
(c) Describe how you might attempt to resolve conflicts with clients.
Mark
Conflicts with clients is one of the factor which can leads to deterioration of the business
operations. The first most step in resolving conflict is to ascertain or having a deep
knowledge of the basic reason of conflict taking place. Once the reason is determined,
measures related to how to handle and resolve conflict are
made. This measures helps business organisation in making an ideal place for client to
work with. By having sound business strategies and plans related to conflict reduction
/2

will produce greater satisfaction among clients and employees. It will also lead to
improvement in performance and increase in profitability level.
(d) How do you can prepare clients for the hiccups that can happen while their credit application is
being processed.
Mark
Clients can be prepared by providing details of interim updates. Do not ask the borrower
to provide unnecessary information which is not strictly relevant or which the lender
already has in its possession.
/2
Sub-total /11
Continued
(e) The chapter on Operating a Mortgage Broking Business contains an example suggesting that a
mortgage broker acting in the best interests of clients should act as a Protector rather than an
Expert. What are the implications for this in regard to (i) advice given to clients and (ii)
recommending the most suitable loan products?.
No. Mark
1. New products can be introduced from time to time, changes in the existing
products features can be made. Mortgage brokers should be aware of information
regarding change from product providers with information being shared by
conducting team meetings, seminars etc.
/2
2. The mortgage brokers should also be prepared to discuss the different products
with their clients and point out their different features so that an informed choice
can be made.
/2
(f) How could you prepare yourself to deal with client concerns?
Mark
For dealing with the concern or issues of client, one should adopt following ways for
overcoming these issues and making client satisfied:
1. Understanding the scope of client project and defining the time frames for
completion of such projects.
2. Meeting clients expectations by rendering of quality services as per the budgeted
amount and resources.
3. Making clear about the cost associated with the project and its schedule and
deciding the time period for making payment.
4. Assessing the problem which is causing the project conflicts and hampering the
interest of client. After making assessment of the problem, professional response in
form of clear and proper course of action should be given for overcoming such
/2

problem and making client satisfied.
(g) Give examples of the following legal breaches: breach of the duty of care, false and misleading
conduct, unconscionable conduct & conflict of interest without disclosure.
No. Mark
1. Breach of duty of care example - THE COMMONWEALTH v. VERWAYEN.
In this case, where the Commonwealth had been in breach of its duty of
care as a result the ship sunk due to negligence. The Commonwealth was
liable for the accident.
/1
2. Breach of duty of false and misleading conduct - In Barnes v Forty Two
International Pty Ltd. In this case, the respondents claim for the false, misleading
and deceptive conduct which was based solely on the fact that the appellants had
made two specific false representations.
/1
3. Breach of duty of unconscionable conduct - Harsh Loan Contract
In the James v. National Financial, LLC, C.A. case, a woman was given the loan
with the interest of 800%. She sued the lender on the grounds that the loan contract
was unconscionable. In its 2016 ruling, the Delaware Court of Chancery assessed
that the loan contract was null and void because it was unconscionable.
/1
4. Breach of duty of conflict of interest without disclosure - In Duke Group Ltd v
Pilmer, the Full Court of the South Australian Supreme Court has attempted to
identify in analogous situations the recurring underlying features of fiduciary
relationships. Among all the issues, one of the issue in the case was whether a firm
of chartered accountants owed fiduciary obligations against their client in some
dealings that the parties had.
/1
(h) Once a desirable market segment has been identified, a mortgage broking business can put its
mind on developing suitable marketing strategies. List examples of different strategies that
might be used.
Mark
Some of the marketing strategies that can help a mortgage broking business are as follows:
1. Make use of social media platform, as it provides the opportunity to connect with
new potential clients. It is a great way to show knowledge as a mortgage broker,
building brand awareness, answer client questions etc.
2. By making mortgage broker services different from other will increase
mortgage broker sales. One way to grab positive attention towards business and
attract new clients is to get referrals.
3. Creating personalised mortgage broker campaigns for each clients will helps in
building clients loyalty and engagement. By using marketing automation, emails
automatically go to each client as per their own needs and preferences this saves
time.
/2

Sub-total /12
Continued
(i) What steps can be taken to keep up to date with product changes and ensure that this knowledge
is properly disseminated?
Mark
Company should make proper business strategies and plans related to the promotion and
advertisement of their newly launched products ad services in the market so as to grab the
attention of its customers towards it. Company should indulge itself in publicity campaign,
hoardings, make use of social media platforms, advertisement in newspaper, articles
related to changes made in product. With the helps of this, customers will be aware about
changes made I products. Also, company should focus on the labelling, designing and
packaging process of its product as this helps in seeking more customer attraction.
/2
(j) What are the procedures for dealing with client complaints in your organisation?
Mark
Every company or business organization should pay attention towards the customer needs
and preferences for making them satisfied. As customer or clients are considered as one of
the most important key for business success. Resolving clients problems timely will help in
customer retention with the company. The procedures for dealing with clients complaints in
business organization are as follows:
1. Listen and understand compliant or grievance by inviting it - Always listen to
the customer or client by taking time and understanding their concern as they are
concerned about services.
2. Empathize – After listening empathize with client position so as to create bond &
let them know that their concern & issue are going to resolve soon.
3. Offer a solution – Solution as per the client issues and complaints is drive
accordingly in a very cost effective manner and timely
4. Execution of Solution and Follow up – Once the solution is made to their problem
as per their need, execute t for checking accuracy. After executing timely follow up
should be taken to assess any error face.
/2
(k) What normal protocols should for protecting the confidentiality of client files?
Mark
The protocol used by company for protecting the confidentiality of client files are as
follows:
1. Document Security – Because of technological advancements document security
has becomes big issue nowadays. Technology has come up with some benefits and
drawbacks as well. Keeping clients’ files in safe cabinet, making use of the
shredding machine etc helps in document security.
2. Data Security - Client’s data is at risk during normal business time especially when
/2

Sending files over the internet and Storing files on local devices. Proper protection
has been provided to this by keeping data with password or in coded form.
3. Accessibility concept – By giving limited access to employee of business
organisation, company can protect its clients files and information.
Sub-total /6
Total /39
Task 3: Contribute to OHS Hazard Identification & Risk Assessment
3.
Contribut
e to
workplace
hazard
identificat
ion
Occupational health and safety hazards are often considered only in terms of
physical injury, perhaps the result of working with heavy machinery, working in
an excessively noisy environment, or slipping or falling. Just as relevant, however,
is work-related stress. This describes the physical, mental and emotional
reactions of workers who perceive that their work demands exceed their
abilities and/or their resources (such as time, help/support) to do the work.
For the questions that follow, please read ‘Overview of Work-related Stress’
from the NSW Government. It may be found at:
http://www.safework.nsw.gov.au/__data/assets/pdf_file/0008/99233/SW08367-
1117-395314.pdf
Other ‘Tip Sheets’ from the same website may also be useful.
(a) How would you define workplace stress?
Mark
Work stress is defined as stress which is generated due to the conflicting demands taking
place in job profile of one person. The work stress level depends on the amount of control
employees have over their workflow.
Workplace stress is considered as the harmful physical and emotional responses which is
happening because of conflict between job demands on the employee and the amount of
control an employee is having over meeting these demands. This combination of high
demands in a job with low control over the situation results in increasing workplace stress.
The stress related work arises in case where work demands of different types, methods and
combinations exceed the capacity and capability of a person to cope. It thus affects the
productivity and overall performance of business organization along with health measures
of employees.
/4
(b) Suggest at least two ways in which work-related stress may affect client relationships.
Mark
If the business organization is having stress related to the work culture it results in
deterioration of client relationships. The retention base of company will decrease if it is
having adverse relationship with its client or customer. The two ways in which client
relationship is affected by work stress are:
1. Deadline – If company is not able to meet its set deadline of a particular client or
business goals and objectives, client will get upset and will prefer other option.
/2

2. Low quality service and unresponsive attitude of company – If company delivers low
and degraded quality service to its client it will result in brand shifting by client. Also, if
grievances or issues of client are not resolve by company properly or on time, any
negligence made will affect client company relationship.
(c) Suggest at least four approaches you can take to reduce workplace stress? (Hint: you may find
suggested ways if you key ‘handling workplace stress’ into a search engine).
Mark
1. Consider Flexible Work Schedules – Always allow employees to have a flexible
working hour or work schedule. It will give them time for them self as well as for
taking care of those people they love.
2. Facilitate Open Dialogue Between Employees and Managers - It helps
employees in better communication, participation in business operations etc. With
open dialogue facility employees will be more aware of stress levels and cause of
their stress.
3. Encourage Employees to Take Breaks - Workplace cultures which encourage
non-stop working can create negative and damaging effects on its employees. By
emphasizing employees to take break during working hour, it will help employees
in becoming less stressed and more productive.
4. Prioritize and Organize – On of the way to reduce stress level in the workplace is
to clarify goals with deadlines. Also, learn how to handle stress at work by
prioritizing and organizing the business goals.
/4
Sub-total /10
Continued
Task 3: Contribute to OHS Hazard Identification & Risk Assessment Continued

3.1 Gather
informatio
n about
workplace
hazards
In assisting in the control of work-related hazards, you will need to be access
suitable information.
Please read ‘Glossary of Job Demands and Job Resources’ from the QUT/ANU
People at Work project. It may be found here:
http://web.archive.org/web/20150227212940/http://
www.peopleatworkproject.com.au/LiteratureRetrieve.aspx?ID=174670
(a) Explain the distinction between ‘job demands’ and ‘job resources’ risk factors.
Mark
Job demands relates to the high levels of psycho-social risk factors detrimental to
psychological well being. It includes all physical, psychological, social or organizational
aspects of job which required the continuous physical as well as psychological effort. A
job demand can have positive & negative outcomes depending on the demand itself as well
as on the ability of individual to cope with this situation. The psycho-social risk factors in
job demand are related to Role overload, ambiguity and conflict, cognitive & emotional
demand etc.
Job resource includes functional aspects in achieving work goals. It helps in reducing job
demands and its associated physiological and psychological cost. It also helps in
stimulating personal growth, learning, and development. The job resource takes into
consideration low level of psycho - social risk factors such as praise and recognition, job
control, Supervisor and co-worker support etc.
/4
(b) Identify two ‘job demands’ risk factors that are relevant to your workplace and describe what
detrimental effect they might have.
No
.
Mark
1. Group Task Conflict - It refers to disagreements with the thought process, ideas or
methodology of team member regarding the project or task work to be undertaken as
a group. The task conflict occurs when two members in a group are unable to move
forward on a task because of different needs, behaviors or attitudes. Such conflict
may involve differences in views about the organizational policies and procedures,
allocation and distribution of resources or method of completing the particular task.
This conflict can result in lower productivity and profitability level.
/ 2
2. Role Ambiguity – The term role ambiguity is defined as lack of clarity or confusion
or uncertainty related to the job responsibilities. Unclear or constantly changing job
role including employees duties & employer expectations related to individual job
will result in role ambiguity. This leads to unattainable feature of organizational goals
and objectives on time.
/ 2
Sub-total /8
Continued
Task 3: Contribute to OHS Hazard Identification & Risk Assessment Continued

3.2
Contribute
to OHS
risk
assessment
Once risks have been identified, they should be controlled. A way of doing this is to
use “job resources” available in the organization.
Once again, please refer to the ‘Glossary of Job Demands and Job Resources’ that
was referred to earlier.
Apart from OHS issues, there are other significant risks that have to be dealt with at
all levels in an organisation.
(a) List the job demand factors you have identified previously and for each one select one or more
job resources that might be used to mitigate these risks.
No. Mark
1. The job demand identified above is Group Task Conflict for which effective job
resource is Supervisor Support.
Supervisor Support considers instrumental as well as emotional support.
Instrumental support refers to the offering of practical help so as to solve the
problems or issues faced, providing tangible assistance in the form of expertise
knowledge, skills or advice which is required to resolve the issue. On the other side,
emotional support includes process of offering care or listening sympathetically to the
another individual member.
/ 1
2. For mitigating the risk of Role ambiguity, best job resource is Job Control.
Job Control is considered as the degree in which an employee has been given the
discretion or right to approach their work as per manner decided by them. It depicts
the capacity of employee in managing own business and work related activities by
including choice of work tasks, methods of completing the work, control over
resource allocation and distribution and mechanism of interpreting facts or data.
/ 1
(b) Select one of the job resources listed and suggest how you could apply it in your work situation.
Mark
One of the best job resource for organization as well as for its employees is Praise and
Recognition psycho-social factor. This factor refers to the feelings or emotions of an
employee self worth which grow along with the perception that the business organization
or company and the people they are working for has some value and respect for them. It is
the basic responsibility of each team leader or manager to praise and recognition the work
done by its employees. The effort made by supervisors can improve the performance level
of its employee. It can be done in form of encouragement, compliments, appreciation etc.
which brings motivation in the employees.
/ 1
(c) Select a significant risk issue, other than OHS issues, that has an impact on the way you perform
your duties and explain how it is managed.
Mark
Occupational stress is considered as one of the most significant risk after the issues related
to the occupational health and safety of the employees. It is one of the most important

factor which creates a negative on the health of employees as well as on the overall health
and business operations of the business organization. The employee can have stress related
to their job profile which impact the physical, psychological, attitudinal, and behavioral
aspects of the employees. Occupational stress started when work demands exceed the
abilities and resources of employees in doing the particular job.
Occupational stress can lead to employee absenteeism, turnover, reduction in job
performance, anxiety, depression which directly affects the functioning of the employee by
declining in the interest or motivation level.
/3
Sub-total /5
Continued
Task 3: Contribute to OHS Hazard Identification & Risk Assessment Continued

3.3
Environme
ntal risks
The risks that should be considered in management decision-making include
environmental risks.
This is giving rise to a new way for businesses to report to stakeholders that goes
beyond traditional financial reporting. It is called “triple bottom line” reporting.
(a)List the three criteria of triple bottom line reporting. What is the likely effect of this form of
reporting on management decision-making at all levels.
No
.
Mark
1. The triple bottom line is a business framework or theory which recommends
that every company should lays emphasis and concern by focusing on the
social and environmental issues like business do on profit motive. The Triple
Bottom Line consists of three components viz. profit, people and planet. It is
the corporate social responsibility of every company to spend towards the
society in which it is operating by incurring some portion of its profit amount
on the sustainable development of that society. Company should mention
about its corporate social responsibility in its Annual report under specific
provisions.
/ 2
2. With the help of Triple Bottom line reporting, all the shareholders as well as
stakeholders such as creditors, suppliers, government, competitor will be able to
know about the activities related to corporate social responsibility in respect of
people, planet and profit carried on by the company. It will help the management in
measuring the financial, social and environmental performance of company over
specified time. It helps in the formulation of sound business policies, strategies and
plans for the betterment of organization as well as individual employee.
/ 2
(b) Select the annual report of a leading financial organization such as a major bank and, after
identifying the organization, summarise what it says about its environmental impact (suggested
maximum length of 50 words).
Mark
Bank selected is Commonwealth Bank of Australia.
The Commonwealth Bank of Australia Group is dedicated towards securing better
environmental opportunities for making sustainable development. It also focuses on
enhancement of the financial benefits and well being of people, businesses and community
in which it is conducting its business operations. The main objective is to ensure meeting of
company's responsibility to both safeguard the environment and support economic growth
and development.
/ 2
(c) Briefly indicate the environmental protection assistance that your business organization is able
to receive from your State or Territory environment protection agency.
Mark
The environmental protection contributes towards making community and ecosystems
more diverse, sustainable and economically productive. For mitigating the environmental
issues and problems, company is receiving the environmental protection assistance from
/ 2

the State or Territory environment protection agency in following manner:
1. Lenders, for example, consider the environmental impact of their lending and have
lists of activities they will not support through their lending activities. They also
consider the environmental impact of their suppliers and seek to operate green
offices.
2. Businesses are not on their own in environmental sustainability issues. In particular,
an important source of information and assistance is provided by environmental
protection agencies in all states and territories:
3. The NSW Environment Protection Authority
4. The Victorian Environment Protection Authority
5. The Queensland Department of Environment and Heritage Protection
6. The Tasmanian Environment Protection Authority
7. The Western Australian Environment Protection Authority
8. The Northern Territory Environment Protection Authority
Sub-total /8
Continued
Task 3: Contribute to OHS Hazard Identification & Risk Assessment Continued

3.4
Effective
team
manageme
nt
Risk assessment also requires effective team management and participation and the
right sorts of questions being asked.
(a) Describe the benefits of team meetings.
Mark
Team meeting is a process of gathering of members of a particular team in an organisation
with an objective making some discussion or sharing of information. It can either be held
face-to-face or remotely. The benefits of team meetings are as follows:
1. It helps in keeping everyone informed about information. Lack of meeting can
result in managers failure to share vital information with its team members.
2. It helps in solving business problems and save efforts and time of solving business
challenges. Team meeting provides an opportunity for its members to share their
problems, issues and concerns, if any.
3. The team meeting provides perfect and suitable opportunity for its team members to
share their new, creative and innovative ideas, thoughts, process and suggestions.
This helps the team in successful and timely achievement of its business goals in a
cost effective manner.
/ 2
(b) Consider your own role in team meetings and describe the approach you and other members
should take to information sharing.
Mark
The role of Facilitator in the team meetings can benefits both the team members and other
as well. The facilitator is a person who maintains the decorum of the meeting as the set
defined standards. The facilitator of the team meeting is required to maintain focus on the
agenda of conducting the meeting. They also ensures that the meeting is conducting and is
bringing progressing well and as per the plans and strategies formulated. The role of
facilitator is to remain neutral throughout the meeting session and keenly observe and
derives opinions, thoughts from every member presenting in the meeting.
/ 2
(c) Give examples of the types of risks that should be considered in all team meetings.
Mark
During team meeting following are the risk associated:
1. Time and Productivity Drainage - Sometime team meetings are time drainer for
its team members which results in low productivity and performance level of the
highly motivated workers. In regular meetings, team members spend their valuable
/ 2

time which they can use in completion of their project work. When the members of
team are having conflicts, it spills out during meeting & results into long usefulness
discussions creating negative effect on the productivity.
2. Rigid and high Management - Too much management by the team leader is
considered as a risk in form of setting of frequent team meetings. Over management
of team leader can hamper the creativity as well as the thought process of its team
members. As a result some members feel limited because of strict meeting
schedules, rules. Team members always prefer working atmosphere in which they
can manage & work independently on their project with their responsibility.
Constant oversight by manager or other members leads to low productivity and
performance level.
(d) Explain why leadership is important in risk management.
No. Mark
1. Leadership brings a sense of motivation among the employees to work towards the
successful attainment of organisational goals and objectives. An effective leader
helps in mitigating the risk factor associated with the business operations.
Leadership is important in management of risk because of following factors:
Provides guidance and direction – An effective leader in the company not only
provides supervision for completing a particular task but also provides proper
guidance and directions in form of instruction, orders or action plan to its
subordinates so that they can perform effectively and efficiently.
/1
2. Builds morale – By boosting up the morale level, it helps leader in gaining co-
operation as well as confidence of the employees towards their work profile. It also
helps in winning the trust of employees. A leader should be a morale booster with
the help of which it can brings improvement in the performance of employees by
seeking best of their abilities for achieving business goals.
/1
3. Action Initiator – A Leader should always be a person who take initiatives in
starting the work. Leader by making proper communication of the business policies
and plans to its subordinates can start the work or task.
/1
4. Coordination- The Leader should have a special feature of developing a sense of
coordination among its subordinates which results in achieving of personal interests
along with the organizational goals.
/1
Sub-total /10
Total /41

Task 4: Manage Personal Work Priorities and Professional Development
4. Set and
meet own
work
priorities
One of the challenges we face in a workplace situation is time management.
Management theory on the subject began with the Pareto Principle, suggested that
only about 20% of the things we do produce 80% of the results we achieve. The
challenge than becomes to set time aside for the 20% that matters.
The theory was taken further with Stephen Covey’s Time management matrix.
(a) Describe Covey’s Quadrant 2.
Mark
The Covey's Quadrant 2 tasks are important but not urgent.
Covey's Quadrant 2 has the items which do not have a high urgency or are not important
but though can play an important as well as crucial role in the future. This quadrant is not
only reserved particularly for making strategic planning but also related to the items such
as health, education, exercise, and career. By making investment of time in these areas, are
may not be urgent at the present day but in the long term and at that time it will be of the
greatest importance and on the priority basis.
Quadrant 2 tasks are vital for long-term goals, dreams, and effectiveness in general life
period. Quadrant 2 tasks are considered as the most important in case of effective and self-
actualized person. The area covered under this quadrant include: exercise, reviewing career
path and maintaining relationships with family or friends.
/2
(b) List three of your work activities that should belong in Covey’s Quadrant 2.
Mark
The list of three work activities which belongs to Covey’s Quadrant 2 includes:
1. Learning another language – It is considered as an important task for every individual
to learn new activity in the life. It helps in up gradation of the knowledge factor. But this
can be taken as optional activity and not important.
2. Writing captivate book – Book writing is fantasy of many individuals. Writing a book
which is having an attractive book contents and cover page may be an important activity
for an author but for an individual it is not urgent.
3. Spending quality time with family & spouse – Family should always be kept on top
priority rather than giving it a second opinion. Sometime spending quality time, giving
attention and showing affection to the near and dear ones is important. But it is not possible
to always be with family as work is another priority which has to be done for making
standard of living better.
/3
(c) Suggest ways that you might utilize to ensure that proper time is spent on Quadrant 2 activities
so that stress is avoided.
Mark
Ways which can be utilised so that proper time is spent on Quadrant 2 activities to avoid
stress are as follows:
1. Time management - It is considered as one of the most important factor with the
help of which an individual employee can achieve its business goals and objectives
/2

before or on time effectively and in a cost effective manner as well. This can lead to
utilisation of spare time in conducting of leisure activity as per own willingness and
reduce stress level.
2. Coordination among daily activities – By making proper coordination among the
work culture or task, it can reduce the stress level among individual employees as
they are properly organised and have clear vision of what they have to do for
achieving business goals.
(d) Digital diaries are now available as both computer and mobile phone apps. Describe the place of
digital diaries in managing personal work priorities.
Mark
Digital diary application in mobile phones and computer helps in management of personal
work by marking it as priorities. The habit of maintaining a diary can help in proper,
smooth and effective functioning. The place of digital diary helps in following manner:
1. Acts as Reminder – It acts as a reminder or helps in scheduling of work, activities
properly without leading to any mistake or errors. With the help of diary, individual
employee can keep himself up to date by completing the task on time.
2. Time line or deadline – Maintaining a proper diary can help in memorising of the
urgent work by just having a look on it which has its deadline near. This results in
successful accomplishment of goals or desired objectives within the specified time period.
/2
(e) Describe the importance of setting goals in terms of personal well-being.
Mark
Goal is defined as the desired result or outcome which an individual or a business
organisation is willing to achieve at the end of performing a particular task. The importance
of setting goals helps personal well being in following manner:
1. With the help of proper and set defined business or personal goal, a focus is there. It
helps in minimising of wastage of resource, efforts as well as energy.
2. It helps in measuring the growth or progress level after the particular task is
completed.
3. With the help of set defined goal, it helps in clear vision and understanding of what
method or process has to be adopted for achieving these goals and objectives.
4. The process of setting goals helps in further delaying of completing the task as the
focus helps in proper understanding of what methods has to be adopted for attaining
these goals.
5. If goals are set, this gives motivation among people as they are aware of what to do.
/2
Sub-total /11
Continued
(f) What does Stephen Covey recommend for “re-creation” (a Quadrant 2 activitiy)
Mark

/2
In quadrant II all the activities are considered as crucial in the long-term which will yield
no benefits on current basis. This is the quadrant where time is invested mostly because of
its importance. Tasks in quadrant two are in direct alignment with one goal which an
individual want to achieve in the long-run. Eg: Success.
(g) What are the common characteristics of work goals?
Mark
The basic characteristics of effective work goals are as follows:
1. Specific – The goal which has been defined should be specific in nature. It should
have a clear vision and free from ambiguity.
2. Measurable – Goals set should be capable measuring in terms of progress and
success.
3. Achievable – The goal defined should be capable of being perform and can be
achieved easily.
4. Realistic – Goal lays down should be framed in accordance with the past business
activities and growth feature.
5. Time bounded – The goal set should have some certain time period define, in which
it has to be achieved with proper business strategies and plans.
/2
Sub-total /4
Continued
Task 4: Manage Personal Work Priorities and Professional Development Continued
4.1.
Develop
and
maintain
profession
al
competen
ce
One of the outcomes of spending more time on Covey’s Quadrant 2 is that we
have more time for professional development. Desirable professional development
includes a range of activities begin with reading the morning press to undertaking
a degree course at university. Increasingly these days, it may also involve doing a
course through the internet.
Setting professional development goals is part of the goal setting we should
undertake in are working life. If we have personal goals we are more likely to
make things happen. Also, research suggests that goal setting relieves stress and
increases physical wellbeing.
Goal setting of this type is a Covey Quadrant 2 activity. As such it is something
we have to deliberately set time aside for. This may be easier over time because
that way it becomes more of a habit.
Ideas for professional development do not come out of a vacuum. You should be
prepared to seek advice from colleagues and other mortgage brokers.

(a) List three activities you might consider undertaking to increase your competency (in addition to
formal professional development training) to comply with ethical, legal and procedural
requirements.
No. Mark
1. For developing and enhancing competency in relation to ethical aspects role play
sessions will be attained. This in turn develops understanding in relation to dealing
with aspects related to ethical dilemma.
/1
2. Legal requirements includes compliance of all applicable rules, principles, norms,
laws and guidelines under specific regulatory body which helps company in
performing better operations as compared to rivalry firms which are not complying
with its legal requirements and hence penalty is levied. This give company increase
profitability factor and leads to create more competitive market.
/1
3. Procedural aspects helps company or an individual in smooth functioning of its
business operations by following proper procedures, processes of conducting a
particular task. This requirement supports by completing the task in a cost effective
manner and on time thereby creating competition in the market.
/1
(b) Describe how you can obtain ideas for professional development from (i) feedback and (ii)
competency standards.
No. Mark
1. Feedback – Achieving feedback or suggestion for customer, clients related to their
products or services render in form of online questionnaire form or physical quality
feedback form in which suggestion related to company's business operations are
mentioned. With the help of good feedback or suggestion provided to the company,
it should be inculcate those ideas in business operations so as to improve business
performance and quality service.
/1
2. Competency standards – By adopting the benchmarking tool, company can compare
its business operations, processes with the business standards or process followed by
its highly growing competitive firm in the market. This helps company in
developing more innovative and better business processes which strives towards
profit maximisation.
/1
(c) Where do you see yourself in three years time? List three skills or competencies you will need
to arrive there. Against each skill or competency nominated, suggest how you will attain it.
Mark
1. In the coming 3 years time, as an individual employee I want to see myself in the
respective position in the business organization with better growth options. Also,
wants to inculcating the managerial and professional attitudes in the subordinates so
as to make themselves more reliable and capable of making sound business related
decision.
/1
2. Also, want to develop effective leadership qualities with much better knowledge
base. Along with good leadership quality, sharpening of skills and ability is also
/1

considered from the future prospective.
(d) Suggest ways in which mortgage brokers may network to assist other mortgage brokers.
Mark
The way can be as follows:
Organising a mortgage broker forum of 4 to 8 sound minded brokers who will conduct
meeting monthly to discuss about their business challenges and experiences
Publishing experiences, suggestions, tips and advice in any article, newspaper like I’d be
very much thankful for such contribution to my site but equally I know the broker industry
magazines would love to receive some content too.
/2
Sub-total / 9
Total /24
Task 5: Develop and Nurture Relationships with Clients, Other Professionals and Third Party
Referrers
5 Develop
professional
business
relationships
David Maistre has defined professionalism as an ‘‘… an unqualified dedication to
excellence in serving clients and their needs.’ This has important implications for
how client relationships are established and maintained.
Mortgage brokers are also able to develop and benefit from relationships with
other brokers because their main competition is not with each other. Rather, it is
the banks and other financial institutions.
Networking within the industry is therefore important.
Meeting other mortgage brokers requires much the same techniques as meeting
clients, other professionals and third party referrers. The relationship depends on
the development of rapport and the ability to contribute to the relationship in key
knowledge areas.
(a) What needs to be demonstrated at the outset in a client relationship? When is appropriate to
demonstrate competence?
No. Mark
1. Trust is essential with context to long term client relationship na dis straightforward
process which involves management of expectation, effective communication and
deliver as per promise and often take time for clients to trust their advisors.
/1
2. While keeping in touch and delivering outcome, lays emphasis on quality instead of
standardized process and business's short term outcomes.
/1

(b) Imagine that you are explaining the function of mortgage broking to a client. What words would
you use?
Mark
Operating with different lenders for extracting best deal for a home buyer. This act as
intermediary among lender and borrower who has requirement of mortage loan. It gives
access to different loan products and offers broad range of mortgage loans through
different lenders.
/2
(c) Explain the importance of a code of ethics in the relationship between a professional and clients.
Mark
Code of ethics helps professionals to conduct business with integrity and honestly. It
clearly lays out the rules for behavior to their clients and for preemptive warning and
builds trust and relationship among customer and employee. It gives standard for judging
off duty relationships, so that it raises chances to exploit power and it has been stated that
prior any individual agree for becoming client and enable to learn exactly about services,
counseling and techniques process for employing sort of arrangements of payment as per
expectations.
/2
Sub-total /6
Continued
(d) Drawing on your own experience or the experience of a more experienced colleague or
manager, describe a situation where a need was identified to use language and concepts
appropriate to cultural differences. How was the need met?
No.
1
.
In particular team, there must be use of numerous concepts and
language which is proper for attaining success. It encourages employees to
come up with solutions of problem and it leads to prevent employees
through hiding issues that could growth for bigger issues.
/1
2. Cultural conflicts among employees might be a manifestation of
numerous other issues. The staff would be focused to get work done for
dwell on differences in culture among each other. However, building
teamwork along with sense of organisation pride in employees indirectly
will decrease cultural conflict.
/1
Sub-total /2

Continued

Task 5: Develop and Nurture Relationships with Clients, Other Professionals and Third Party
Referrers Continued
5.1 Build and
maintain
business
networks
and
relationships
For a relationship with a client to continue, they need an assurance of continuing
mutual benefit. The continuing mutual benefit is also important in relationships
with other professionals, including relationships with ‘outsiders’ such as
accountants, real estate agents and other professionals.
(a) List two others type of professional your organization uses to develop client relationships and
indicate in each case how it is able to provide them with a benefit in the relationship.
No.
1. It could be very hard for admitting about absence of source of every
knowledge along with advice, but professionals like lawyers and
accountants.
/1
2. The clients attain information about research particular matter and
required to refer clients to professionals with great expertise. This is
something that mortgage brokers required to learn to perform if they are
are appropriate to professionals. This is matter of acting with best
interest of clients, which is what duty of care is all about.
/1
(b) Surveys indicated that two-way dialogue, or ‘conversation’ is of overriding importance in
developing client relationships, relationships with colleagues and also other professional
relationships. List four characteristics of this process.
N
o.
Mark
1. Dialogue could develop character, clarify setting, shape plot and convey theme. /1
2. Client relationship has main feature of in-person connection as it is significant for taking time
regularly connect in person and allows for improving customer satisfaction. /1
3. Involvement early and often as with unique research to press release to
business objective to product messaging which is critical for agencies
engaged as soon as possible for taking active role to map path of success.
/1
4. The main feature is related to transparency as PR agencies must be observed as
trusted advisors with the best disclosure.
/1
(c) Other professionals that a mortgage broker might forms contacts with are referred to in
marketing literature as ‘Centres of Influence’ (COI). Why does David Maistre place them in his
‘second tier’ in order of effectiveness. What activities in David Maistre’s first tier does your
organization engage in.

No. Mark
1. Main aspect for remembering that clients must be truly satisfied and eager
to give referrals due to mode of benefiting social contracts and family. It is all
about asking and giving referrals gives more prompts as it offers with
permission for ahead.
/1
2. Working with ideal clients, brokers are likely to have the best level to
concern which is mandatory for essential quality of professionalism. It is
more likely for developing communication with clients that directly leads to
engagement which is longer term relationship that originated from personal
connection. The view of ideal client then it becomes on basis of marketing
plan designed for attracting and capturing more of similar clients.
/1
Sub-total /8
Continued
(d) List four occupations and professionals that may become Centres of Influence.for your
organisation.
Mark
In this aspect, tyher are numerous associated professionals whiuch are engage din process
of lending such as:
1. Valuers
2. Credit Reporting agencies
3. Solicitors and conveyancers
4. Land tiles offices
/1
Sub-total / 1
Total /17

Task 6: Promoting the Effective Use of Credit
Read the following scenario then answer the questions that follow.
Roslyn qualified as a schoolteacher some years ago, but failed to take up a teaching position after
graduating because she became a single mother. Fortunately, she has been able to live with her
widowed mother, but now that her daughter has reached school she is taking up a position as a
schoolteacher some suburbs away.
Because of the distance of her new school from her parent’s home she will need to buy a car. After
careful consideration, she has chosen a small hatchback that has an on-road cost of $15,800.
She will be working full time with a starting salary of $50,000.
She knows little about finance and has come to you for advice. She would prefer to finance the full
cost of the car because she has little in savings.
Task 6.1.
(i) Suggest two financing options that Roslyn might consider.
(ii) Explain the main features of each.
(iii) Choose one of these options and explain your choice. Are there any disadvantages that need
to be considered?
No. Mark
1. Commercial hire purchase and secured personal loan /1
2. Commercial hire purchase is considered as form of commercial finance
used for funding items which get depreciate quickly like motor cycle. It would
be only be considered over medium term and maximum up to 5 years and
borrower has presence of absolute right to buy the item funded at end of
CHP term.
Secured personal loan is sought for buying motor vehicles which is being
used for securing loan. Generally, interest rate for secured loan in lower.
Unsecured loan is implied for consolidation of debt, holidays and to finance
personal requirements like white goods and furniture. These loans are
unsecured due to little or intangible property over lender could take charge.
/2
3. In the particular case, I would recommend Roslyn for applying to secured personal
loan as it gives lump sum amount after approval which satisfies need. Apart from
this, interest rates for secured loans are lower. Furthermore, taking out a secured
loan, Natalie fails for making payment on asset secured, credit giver could repossess
the asset and sell for recouping money. In case, asset is sold for low value which
would repay the creditor difference.
/2

Sub-total /5
Continued

Task 6: Promoting the Effective Use of Credit Continued
Task 6.2.
Write a letter to Roslyn letting her know about your preferred, explain how she will make payments
and giving your reasons for choosing it as the option more clearly meeting her needs. You should
take care to proofread your letter.
Mark
Roslyn,
I have articulated that Westpac Car loan as best product as there are numerous availability
of loan but with best fit. The fee for specific product as below:
6. Establishment fees of $250
7. Monthly fee $10
8. 9.99 interest per annum with comparison rate of 11.34
According to NCC borrowers offers comparison rate which comprises other fees and
interest charges. This rate is implied for comparing against product from different banks.
The charges and fees does not comprise government fees along with expenses. In this
aspect, there are hundreds of products which you could select. It is very difficult for
understanding complex structure of fees in specific products so NCC has need of credit
providers to reflect comparison rate as this will help customers for comparing different
products.
Moreover, to assist prospective of consumer borrowers for understanding exactly
that how much is paid for their loan, National credit code has need of credit providers
supply a comparison rate implied with standard formula with consideration of factors that
consist of interest rate, amount of loan, frequency of repayments, term of loan and fees
and charges linked with loan. For instance, bank may advertise its home loan interest rate
as 5.5% when fees and charges aggregated and real rate might 6.75%. Thus, Roslyn has
requirment of comparing comparison rate but rate of interest identifies real costs of loans
offered through credit providers.
Furthermore, comparison rate could alter perspective of two loan interest rates.
For instance, Loan X and Loan y's rate of interest rate is 6%. The charges and fees of
Loan X is 0.5% compared to Loan Y as 0.1%. As a outcome, comparison rate of loan is
6.5% which is more as compared to rate of loan Y 6.1%, and Loan Y is cheaper of two.
/4
Task 6.3.
Roslyn is concerned that the lender will apply for a credit report. Explain:
(i) The procedure and cost involved in obtaining a copy of her credit file.
(ii) The right of a lender to access credit report information.
No. Mark
1. In the present scenario, there are three main credit reporting agencies
directly operating in Australian market which are Veda advantage,
Bradstreet and Dun along with Tasmanian collection service.
As per website of Veda, credit report could be ordered online with
different fee option
/2

Free File Veda
Starter
Veda
Access
Veda
ID
Veda
Plan
What's
Included?
Order now Buy now Buy now Buy now Buy now
FREE $79.95 /
YR
$89.95 /
YR
$104.95 /
YR
$119.95 /
YR
Learn
More
Learn
More
Learn
More
Learn
More
Learn
More
Credit
Report1
1 per year 1 per year 2 per year 2 per year 4 per year
VedaScore
2
- 1 per year Monthly 2 per year Monthly
Credit
Alerts
- - Yes Yes Yes
Score
Tracker
- - Yes - Yes
Identity
Watch
- - - Yes Yes
Identity
Guard
Insurance
- - - Up to
$15,000
Up to
$15,000
Online
Membersh
ip
- Yes Yes Yes Yes
Resolution
Centre
Yes Yes Yes Yes Yes
Knowledg
e Area
- Yes Yes Yes Yes
FREE $79.95 /
YR
$89.95 /
YR
$104.95 /
YR
$119.95 /
YR
2. The information held through agencies of credit report like Veda
advantages has presence of significant implications for applicants. The bad
credit history could result in refusal of credit. The consumers with minimal
financial experience must be aware about potential future consequences of
defaulting on obligations of credit. Moreover, federal government has
committed with inclusion os responsible obligations of lending as part of
innovative licensing regime for providers of consumer credit. It is essential
for lenders as
1. Offering credit products which are appropriate for circumstances of
borrower.
2. Only lend to a borrower with capacity for servicing repayments of
/2

loans and perform with substantial hardship.
Task 6.4.
Further information
Roslyn mentions that her mother’s washing machine has broken, and she urgently needs a
replacement washing machine. The cost is less than a thousand dollars and she plans to use her
credit card for the purchase. She tells you that she will make the minimum required repayment per
month until she pays the machine off.
Draft a letter to Roslyn providing advice about her plan.
Mark
Dear Roslyn,
It is recommended you to purchase new washing machine for the betterment of both the
mother as well as for yourself. With the help of credit card, you can make purchase now
and pay it at later date. The cost of purchasing new washing machine is less than a
thousand dollars. If you want you can give down payment of 500 dollar and pay remain
balance in installment amount as per your conveniences. It is better to go purchase with the
above suggestion.
/2
Sub-total /10
Total /15

Task 7: Prepare a loan application on behalf of mortgage broking clients
Case Study — Evaluating and processing a loan application
Read the following case study then answer the questions that follow.
Ross and Melissa Cooper are a young couple who have been married for five years, during which
they have been renting an apartment while saving to buy an apartment of their own. They do not
have any children at this stage.
After some months searching, they have found a small two-bedroom apartment that suits their
needs. The purchase cost of the property is $480,000, and they have provided a deposit of $60,000.
You are recommending a standard variable loan.
Ross has been working at Gaines Consulting Pty Ltd. for 12 years and has a salary of $80,000.
Melissa has been working at Jackson Equipment Hire Pty Ltd for 8 years and has a salary of
$70,000. Neither has had previous employment, apart from casual work when they were younger.
The full details of Ross and Melissa that you have collected are as follows:
Applicant 1 Applicant 2
Loan purpose Purchase home
(owner occupied)
Amount and type of loan
sought
$480,000 standard
variable rate
Deposit $60,000
Address Unit 2, 27 High St.,
Mackville, NSW. 2080
Unit 2, 27 High St.,
Mackville, NSW. 2080
Status Renting Renting
Years
there
5 years 5 years
Contact
details
Phone
(W)
Phone (H)
02 9200 1111 (w)
02 9400 9900 (h)
02 9310 2000(w)
02 9400 9900 (h)
Mobile [phone] 960 000
Email [e-mail] [e-mail]
Number of dependants Nil Nil
Employment Gaines Consulting Pty. Ltd Jackson Equipment Hire Pty Ltd
How long? 12 years 8 years

Gross income ( p.a.) $80,000 p.a. $70,000 p.a.
Credit history Personal loan to purchase a car
— since repaid.
Personal credit card with Central
Bank with a limit of $3,000.
Current balance: $300
Note: All credit cards are repaid
in full when due.
Personal credit card with
Northern with a limit of $2,000.
Current balance: $300
Store card with Wilson’s
Department Store. Current
balance: S250
Note: All credit cards are repaid
in full when due.
ASSETS AND LIABILITIES
Assets Liabilities
Details Market value Details Monthly
payments
Amount owing
Cash at bank $15,000 Credit card
limit: $2,000
$2,000 $300
Deposit paid on
property
$60,000 Credit card
limit: $3,000
$3,000 $300
Motor vehicles:
1.
2.
$15,000
$7,000
Other:
Personal effects $30,000
Business value Nil
Total assets $127,000 Total
liabilities
$600
Surplus/deficiency: $126,400
OTHER DETAILS:
They are seeking a loan term of 25 years. Other requirements are:
 proposed settlement date — 6 weeks time
 ability to make additional payments from time to time without penalty
 monthly repayments
 redraw facility.
The applicants will have no other financial commitments other than their monthly mortgage
commitments, rates and utility costs and strata fees.
The current variable home loan rate is 6% pa.
Note: For the purposes of this assignment, any first home purchase assistance should be ignored.

OTHER INFORMATION
APRA is concerned that interest rates may rise and because of this it is requiring all lenders to
“stress test” all housing loans at a borrowing rate of 7% p.a.
Task 7.1.
Apart from requiring the presentation of a Credit Guide, the NCCP Act says nothing about what a
mortgage broker should say about him/herself at the beginning of a client interview. In the space
below, make a few brief points about what you would say about yourself and your firm at this stage.
Remember that at the outside the client is primarily looking for assurance that the broker is
concerned about them and their interests.
Mark
The concept of low doc loan which does not need to offer evidence of income as
obligations could be fulfilled and most common documents must be asked such as BAS
statements for verifying turnover and estimate of income. Trading statements or bank
account statements from business and template of accountant's letter for accountant to sign
and confirmation for income.
/2
Task 7.2.
List in point form the important information a Credit Guide conveys to the credit applicant.
Mark
1. Name of license and contact details
2. ACL no. of license
3. Method and details to work out any payable fees by consumer to the license.
4. Details of top 6 lenders that license and credit rep has introduced customers.
5. Commissions that third party is retaining for introducing consumer to the
licensee
6. If license has a volume bonus arrangement with lender, statement that is
payable commission by which lender might be dependent on volume written and
commission might be driven through volume
7. The details of IDRS and EDRS on license
8. Information related to preliminary assessment along with reasonable enquiries
9. Explanation of relationship among lender and mortgage manager along with fee
that mortgage broker explicitly charge to consumer for service
/3
Task 7.3.

Under the Anti-money Laundering and Counter-terrorism Financing Act 2006 (AML/CTF Act),
mortgage brokers are required to establish the identity of their clients. To do this they must cite
original copies of at least three primary documents and one secondary document. List three primary
documents and one secondary document below.
Mark
Primary documents
1. Original primary photographic identification document
2. Original primary non photographic identification document
3. Customer specific documents like account statements
Secondary documents
1. Original secondary identification document
2. Document verification service as Authorized deposit taking account
/3
Sub-total /8
Continued
Task 7.4.
Mortgage brokers should present adequate information to clients to enable them to make a choice
between loans. This involves conducting research to determine suitable loans and presenting clients
with a choice among, say, three loans that are considered to be suitable for the client’s
requirements. The characteristics of the three selected loans are then presented to clients in a way
that allows a comparison to be made. The presentation may be made a piece of paper, or other
means such as a Powerpoint overhead.
You are now required to use the internet or other sources to choose three loans that you believe will
meet the requirements of Ross and Melissa. The relevant details should be placed in the spaces
provided.
Mark
Credit Provider
Standard
variable rate Fixed rate
Vrindian line
of credit /6
Product Name Owner
occupied
Interest Rate Type (%) 5.37% 3.94% 6.53%
Comparison Rate (%) 5.51% 5.04% N/A
Minimum Loan Amount ($) 10000 10000 20000
Maximum Loan Amount ($) Nil Nil Nil
Minimum Loan Term No 1 year No minimum
Maximum Loan Term 30 years 30 years N/A
Maximum LVR (%) 95.00% 90.00% 90.00%

Maximum Insured LVR (%) 95.00% 90.00% 90.00%
Mortgage Offset Account
(Yes/No) Yes No
No
Loan Redraw Facility (Y/N) Yes no yes
Split Loan Facility (Y/N) Yes Yes Yes
Fixed Interest Option (Y/N) No Yes No
Task 7.5 (a)
Explain significant features of the loan products that you have chosen in words that the client
would understand. Your answer should be restricted to features relevant to the clients.
Mark
The variety of features along with competitive variable rate and availability of great
discount with wealth package in standard variable rate. The certainty had been enjoyed
during monthly repayment would be and fix repayment for period of 1 to 5 years. Apart
from this, viridian line of credit using the equity in home for building wealth, renovate or
to take holiday. The standard variable and fixed rate has split loan facility but virindian line
of credit does not have facility of split loan. In Standard variable rate and virindian line of
credit, there is unlimited additional repayments but in fixed rate, it is up to $10000 in every
year of fixed rate loan (Home loans, 2019). Furthermore, Virindial line of credit, the
payment could be made with credit card automatically but in other types of loan.
/2
Home loans. 2019. [Online]. Available through <https://www.commbank.com.au/personal/home-
loans/comparison-table.html?ei=cta_compare-table>.
Sub-total /8
Continued
Task 7.5 (b)
Credit providers always have other fees and charges beyond their stated interest rates. Select
one of the loans you have set out in Task 7.4 as the one preferred by Ross and Melinda, and
explain any additional fees and charges in a manner that your clients can understand.
Mark
In this aspect, standard variable rate has been preferred to Rose and melinda with
establishment fee of $600, monthly loan service fee $8. The most essential is that ERA
might apply loan if it is switched repaid through more than $10000 in every year of fixed
rate loan, or repaid in full within fixed term. And there will be application of administrative
fees as well.
/2
Task 7.6
It is important to verify the information that you obtain from clients, particularly information
that relates to income. List the documents that you should ask for and then examine to verify
the incomes of Ross and Melissa.
Mark
 Pay stub /3

 bank statements
 Last year's federal tax return
 Wages and tax statement
Task 7.7
In dealing with clients, it is important to explain technical concepts in ‘plain English’ so that they
understand them. In the first two spaces below, explain the terms ‘LVR’ and ‘insured’ LVR’ in
terms that that your clients will understand. Then, in the third space, explain how Lender’s
Mortgage Insurance is normally paid, once again expressing yourself in a way that the clients are
likely to understand.
No. Mark
1. Loan to value ratio is amount borrowed is replicated in percentage of value of
property is used as security for the loan.
/1
2. It is an insurance policy which is obtained through lender but paid through
borrower. This is fort the lender's protection and not for borrower.
/1
3. There is requirement for repaying this Lender's mortgage insurance policy as if
home loan deposit is less than 20% of aggregate value of property. Then individual
lenders might require more or less than 20% of deposit for avoiding paying LMI.
/1
Task 7.8
Mortgage brokers assist their clients to complete their preferred lender’s credit application form, as
well as applications for the First Home Buyer’s Grant and (where applicable) stamp duty
exemption. Examples of these forms are set out over the following pages and you are required to
complete them on behalf of Ross and Melissa. Remember that each form must be signed by the
client, so facsimile signatures must be attached,
Mark
The forms for the following pages can be found at:
https://www.homeloanexperts.com.au/wp-content/uploads/2016/05/ANZ-Loan-
application-cover-sheet.pdf
http://www.osr.nsw.gov.au/sites/default/files/file_manager/ofh001.pdf (application form
only) http://www.osr.nsw.gov.au/sites/default/files/file_manager/oda066.pdf ((application
form only)
/15
Sub-total /23
Continued
Task 7: Prepare a Loan Application on Behalf of Mortgage Broking Clients Continued
Task 7.9.

It is important to keep clients informed about the steps involved in the credit approval process.
Indicate how your organization keeps your client informed as the loan application proceeds. What
are the likely normal time intervals for each step that you explain to your clients.
No. Mark
1. The loan application proceeds steps along with time intervals involves following
steps:
1. Assessment of borrower purpose of loan - Approx 15 to 30 minutes.
2. Recommendation by lender in writing as per the need requires a time
interval of maximum 3 to 4 hours.
3. After getting agreed with the recommendation, documentation is done which
involves time depending on both the borrower and lender institution.
4. After documentation, application is made and forward for signing of the
borrower which takes time of around 4 to 5 hours.
5. Valuation will be done online between 24 and 72 hours.
6. Once assessment is commenced and all supporting documents accepted it
will take 24 – 48 hours.
7. Approval of application, preparation of mortgage documents and post
requires 3 days.
8. Document returned to the lender and settlement starts – 3 days.
9. Money is hand over and settlement is finally complete.
/2
Task 7.10
Assess the loan application of Ross and Melissa Cooper against the five C’s.
a) Character
How would you assess the applicants’ character?
Mark
As per the given case study, it can be assessed that Ross and Melissa Cooper are having a
character of good borrower with track record of repaid debt amount. When the capacity of
these borrowers are determined it has been evaluated that Income of borrower is sufficient
and good enough & are fully capable of repaying the loan.
Also, $60000 amount of capital is saved by Ross and Melissa Cooper for the purpose of
deposit in purchasing the house. The collateral will be the house itself against which the
loan is taken for a period of 25 years.
The loan condition of Ross and Melissa Cooper includes $480,000 standard variable rate
with $60000 as deposit and current variable home loan rate is 6% pa. for 25 years.
/2
b) Capacity
(i) What will the applicants’ monthly payment be, given the current variable lending rate of 6%
p.a.? (Hint: visit a website such as: http://www.yourmortgage.com.au/calculators/).
(ii) Using the ‘income percentage method’, assess the applicants’ capacity to repay the loan (25
words)

No. Mark
1. The estimated monthly payments are $2,518.11 with the payment of $486,520.39 as
interest over the total 30 years loan period.
/1
2. With the help of income percentage method, the bank can easily evaluate the
Installment and interest repaying capacity of Ross and Melissa Cooper over
percentage of the fixed income.
/1
Sub-total / 6
Continued
Task 7: Prepare a Loan Application on Behalf of Mortgage Broking Clients Continued
c) Capital
(i) How would you verify the equity the applicants intend to contribute to the purchase?
(ii) What should you be careful about regarding this contribution? (50 words)
No. Mark
1. The bank should verify the equity capital of ROSS and MELISSA cooper by taking
into consideration bank account statements of the previous 3 months, CIBIL score
proof of income documents i.e. Income tax returns, employer contact information
for cross verifying the details of employee and their financial position.
/1
2. The bank should determine the purpose of the borrower for which reason the loan is
being taken. Also, the bank should ascertain that the objective of the client is lawful
and not illegal.
/1
d) Collateral
(i) Assuming the valuation placed on the property is $480,000, calculate the loan to valuation
ratio (LVR).
(ii) Given the LVR that you have calculated, what steps might the bank take to protect its
position? (25 words)
No. Mark
1. Loan to Value ratio is calculated by dividing the mortgage amount with the
appraised property value.
Loan to Value ratio = $420,000/ $480,000
Loan to Value ratio = 87.5 %
/1
2. The LVR calculated is 87.5% that means the client is borrowing for more than
87.5% of the house value against which the bank should get Private Mortgage
Insurance for protecting against the credit default on the part of client.
/1
e) Conditions

Using the information that has been presented, identify any ‘conditions’ that might impact on
this loan application. How should they be handled?
Mark
The loan application given by Ross and Melissa Cooper for seeking house loan should
comply with all the loan requirements as mentioned by the lending institutions. In Ross and
Melissa Cooper Case, they are employee of one firm only for many years and don't have
any past employer data. This can impact their loan application as they are lacking employer
contact information.
/2
Task 7.11
What is your organisation’s policy about notifying applicants of the outcome of their application?
Mark
The lending institution should inform their applicants about the outcome of the loan
application with the help of email or post within the stipulated time frame so that further
process of documentation can be started after getting the approval of the client.
/2
Sub-total /8
Continued
Task 7.12
The credit application that is forwarded to the credit provider is accompanied by supporting
documentation used to verify the information concerning the financial position of the client. List six
types of document that are likely to be forwarded. In the case of Ross and Melissa Cooper.
No. Mark
1. Proof of Address /1
2. Pass port size photographs of the applicant /1
3 Identity proof of the applicant /1
4. Proof of Income documents i.e. Income tax returns of last years /1
5. Complete loan application /1
6. Bank account statements of the previous 3 months. /1
Task 7.13
What should be the rules regarding access to client files?
Mark
The rules regarding the accessibility to the client files are as follows:
1. By seeking the written or verbal request of the client, one can have access for
reviewing the files.
2. Obtaining without charge a copy of the information in client records.
/2

Task 7.14
There are times that you might suggest to clients that they should have a fixed interest loan for a
period. Explain why you would do this.
Mark
The fixed interest loan taken for a definite time period helps the client in ensuring that the
fix repayment of the loan amount for a set period of time which is not changing. This helps
the borrower or the client in determining exactly the amount of payment due for each
month.
/1
Task 7.15
List the information you should include on a client file.
Mark
The client files should contain the following information:
1. Proof or evidence of the analysis made of financial and credit aspects, if applicable
or required.
2. Electronic or paper copies of records received from the client or created on behalf
of them.
3. List of providers of service or product whose information was provided to the
client.
4. The authorization of client for making the order of a credit report.
5. Documents supporting the cost factor.
2
Sub-total /11
Total /64
Task 8: Steps Taken by the Credit Provider
8 Build and
maintain
business
networks
and
relationships
As indicated, the process of interviewing a client, carrying out a preliminary
assessment, and forwarding a credit application to a credit provider should take no
longer than two days. The credit provider’s task, however, is more involved and
takes longer because there are more matters to consider than the final assessment,
which is normally carried out soon after the credit application has been received
from the mortgage broker.
These matters include having the security valued and negotiating any additional
support, checking all details, preparing an offer letter, preparing security
documentation, having the loan documentation signed, attending settlement,
registering the mortgage and having the mortgage documents stamped.
The offer letter is in fact the loan contract the mortgage broker becomes involved
once again – to check that the requirements of the loan purpose are met and to
ensure that the client understands all terms and conditions.
Task 8.1.

The final assessment of the credit application is carried out by an officer of the credit provider, or at
a higher level if that officer’s authority is exceeded. What is that officer’s responsibility in terms of
the NCCP Act.
Mark
If any individual or business company is engaged in the function of credit providing activities,
then credit provider has some legal obligations under the NCCP Act which has to be comply
with:
1. The credit provider should comply with all the relevant legislation and rules under the
NCCP Act.
2. The credit providers should meet with their lending obligations and procedures.
3. It helps in ensuring that all the conflicts of interest are deal appropriately and are
reported on time.
/2
4. It is the duty of credit provider to make disclosure of all relevant information to the
consumer.
5. Are trained and competent enough to engage in credit activities.
6. Is having a place for resolve the dispute if arises any.
Task 8.2.
Give examples of the information that the mortgage broker may be asked to obtain at the time of the
final assessment.
Mark
The information which the mortgage broker may be asked to obtain at the time of the final
assessment are as follows:
1. Annual percentage of rate i.e. rate of interest
2. Repayment schedule
3. Amount of balance due in the credit card
4. Cross checking of false or misleading information if any provided by client.
5. Bank account statements of the previous 3 months.
6. The Latest salary slips.
7. Copy of the documents of the property to be mortgaged.
/2
Task 8.3.
Sometimes additional support, such as a third party guarantee is required in housing loans. Indicate
when such support may be required and the matters about which the credit provider should seek to
be satisfied. How is the required evidence about those matters normally obtained?
No. Mark
1. The return of Income Tax for the particular period can act as a proof with the help
of which source of income of individual can be determined.
/1
2. CIBIL scoring of an individual client given by the credit rating agency can help the
mortgage broker in assessing the credit worthiness of the client.
/1
3. Employer contact information where the client is employed under the provision of
the employment act.
/1
Sub-total /7
Continued

Task 8.4.
Distinguish between the credit provider’s final assessment and the credit review carried out by the
credit provider?
Mark
The role of credit provider before approving for the offer letter of mortgage is to make final
assessment of all the evidences pertaining to the economic and financial position of the client.
This can help the mortgage broker protecting from the credit default loss which can be arises
because of incapability of client to repay the debt.
The credit review is a process in which the periodic review is conducted by the credit provider
or lending institutions on the customers having outstanding loan or credit lines.
In credit provider final assessment, the credit provider make full assessment of the credit
report information of the client so as to ascertain any default risk associated whereas in credit
reviewing process, review is made by the credit provider on the periodical basis for analysing
the amount of outstanding loan.
/3
Task 8.5.
List five of the checks the credit provider would normally perform before preparing an offer letter.
No. Mark
1. It is the duty of credit provider to cross check whether the payment of bills has been
made on time or not by the client.
/1
2. The balance amount of the credit card should be low while applying for credit
assistance which has to be check by credit provider before preparing of an offer
letter.
/1
3. Credit providers should takes into consideration all the zero balance accounts of the
client.
/1
4 The information or statistics related to the credit report of the client should be
checked for its accuracy detail.
/1
5. It is the responsibility of the Credit provider should ensure that client has not made
any credit default earlier before approving for the preparation of an offer letter.
/1
Task 8.6.
Why do mortgage brokers become involved once again when the offer letter is forwarded to the
client? What legal responsibility under the NCCP Act leads to this involvement?
No. Mark
1. As per the NCCP Act, the mortgage broker role is to ensure that the mortgage loan
granted should be in the best interest of client. It should be capable of satisfying and
fulfilling the requirements needs of the client.
/2
2. Before permitting the approval for mortgage to the client, the mortgage broker
should check that no false information or disclosure has been made by the client for
seeking the credit assistance in form of mortgage as per the provision of the NCCP
Act.
/2
Task 8.7.
List four other matters relating to the offer letter that the mortgage broker should check.

No.
1. The mortgage brokers should consider the rate of annual percentage at which the
credit product has been acquired by the client earlier.
2. The tax paying capacity of an individual client as per their income has to be
checked so as to ascertain the credit worthiness of the client.
3. The installment or repayments capacity of the client in accordance with the
mortgage amount has to be taken in consideration. It will help in determining the
time period in which the mortgage loan will be repaid back.
4. Amount of credit due on the part of client should be identified for the purpose of
granting of the offer letter.
/1
Sub-total /13
Continued
Task 8.8.
Imagine that you are the client’s solicitor writing to the client. In words that the client is likely to
understand explain: what happens at settlement; how funds are normally disbursed following
settlement; and how the title document is registered.
No. Mark
1. When all the final mortgage documents are signed on the specific day and time,
along with the transfer of the payment of all necessary items which is required for
making completion of particular task is called as the settlement date.
/1
2. After the loan is approved, the loan application is transfer to the closing and funding
department which notifies the mortgage broker and the closing attorney of the
approval. It also verifies the fees of broker and closing department.
/1
3. After documents are signed, the closing department return it to the lender who
examines the department and arranges funds after getting satisfied. At last, the final
disbursement of funds is made.
/1
Sub-total /3
Total /23