Certificate IV in Finance Assignment

This assignment for the Certificate IV in Finance and Mortgage Broking includes various tasks related to financial assessments, client interactions, and mortgage recommendations. Students are required to analyze case studies, complete client information collection tools, and provide detailed proposals based on the financial situations of clients. The assignment emphasizes understanding responsible lending obligations and the necessary documentation for mortgage applications.

Assignment
Certificate IV in Finance and Mortgage Broking
(CIVMBv1_AS_A2)
Student identification (student to complete)
Please complete the fields shaded grey.
Student number 10430965
Assignment result (assessor to complete)
Result — first submission (Details for each activity are shown in the table below)
Not yet competent
Parts that must be resubmitted:
1, 6.1, 6.2a, 14.2, 14.4
Result — resubmission (if applicable)
CIVMBv1_AS_A2

Result summary (assessor to complete)
First submission Resubmission (if required)
Task 1 Not yet demonstrated Demonstrated
Task 2 Demonstrated Demonstrated
Task 3 Demonstrated Demonstrated
Task 4 Demonstrated Demonstrated
Task 5 Demonstrated Demonstrated
Task 6 Not yet demonstrated Demonstrated
Task 7 Demonstrated Demonstrated
Task 8 Demonstrated Demonstrated
Task 9 Demonstrated Demonstrated
Task 10 Demonstrated Demonstrated
Task 11 Demonstrated Demonstrated
Task 12 Demonstrated Demonstrated
Task 13 Demonstrated Demonstrated
Task 14 Not yet demonstrated Demonstrated
Task 15 Demonstrated Demonstrated
Task 16 Demonstrated Demonstrated
Feedback (assessor to complete)
A very good first attempt at the assignment. There are a few questions that require further
work: 1, 6.1, 6.2a, 14.2, 14.4. Please be guided by my comments at each task and refer to the
self-study material for reference.
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Before you begin
Read everything in this document before you start your assignment for Certificate IV in Finance and
Mortgage Broking.
About this document
This document includes the following parts:
• Instructions for completing and submitting this assignment
• Results and feedback
• Section 1: Case study 1 — Malcolm and Susan Johnson
• Section 2: Case study 2 — John Simpson
• Appendix 1: Fact Finder
Instructions for completing and submitting this assignment
How to use the study plan
We recommend that you use the study plan for this subject to help you manage your time to complete the
assignment within your enrolment period. Your study plan is in the KapLearn Certificate IV in Finance and
Mortgage Broking subject room.
Completing the assignment
Saving your work
Download this document to your desktop, type your answers in the spaces provided and save your work
regularly.
• Use the template provided, as other formats will not be accepted for these assignments.
• Name your file as follows: Studentnumber_SubjectCode_Submissionnumber
(e.g. 12345678_DFP1B_Submission1).
• Include your student ID on the first page of the assignment.
Before you submit your work, please do a spell check and proofread your work to ensure that everything is
clear and unambiguous.
The assignment
This assignment is split into 16 Tasks, over 3 Sections. To finish this assignment, you must complete all
16 tasks.
The information and data you need to complete Sections 1 & 2 is presented in case studies at the beginning
of those sections.
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Word count
The word count shown with each question is indicative only. You will not be penalised for exceeding the
suggested word count. Please do not include additional information which is outside the scope of the
question.
Additional research
When completing the Client Information Collection Tool in Appendix 1, assumptions are permitted although
they must not be in conflict with the information provided in the Case Study.
You may also be required to source additional information from other organisations in the finance industry
to find the right products or services to meet your client’s requirements, or to calculate any service fees
that may be applicable.
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Submitting the assignment
You must submit your completed assignment in a compatible Microsoft Word document.
You need to save and submit this entire document.
Do not delete/remove any sections of the document template.
Do not save your completed assignment as a PDF.
The assignment must be completed before submitting it to Kaplan Professional Education.
Incomplete assignments will be returned to you unmarked.
The maximum file size is 5MB. Once you submit your assignment for marking you will be unable to make
any further changes to it.
You are able to submit your assignment earlier than the deadline if you are confident you have completed
all parts and have prepared a quality submission.
The assignment marking process
You have 12 weeks from the date of your enrolment in this subject to submit your completed assignment.
Should your assignment be deemed ‘not yet competent’ you will be give an additional four (4) weeks to
resubmit your assignment.
Your assessor will mark your assignment and return it to you in the Certificate IV in Finance and
Mortgage Broking subject room in KapLearn under the ‘Assessment’ tab.
Make a reasonable attempt
You must demonstrate that you have made a reasonable attempt to answer all of the questions in
your assignment. Failure to do so will mean that your assignment will not be accepted for marking;
therefore you will not receive the benefit of feedback on your submission.
If you do not meet these requirements, you will be notified. You will then have until your submission
deadline to submit your completed assignment.
How your assignment is graded
Assignment tasks are used to determine your ‘competence’ in demonstrating the required knowledge
and/or skills for each subject. As a result, you will be graded as either competent or not yet competent.
Your assessor will follow the below process when marking your assignment:
• Assess your responses to each question, and sub-parts if applicable, and then determine whether you
have demonstrated competence in each question.
• Determine if, on a holistic basis, your responses to the questions have demonstrated overall
competence.
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‘Not yet competent’ and resubmissions
Should sections of your assignment be marked as ‘not yet competent’ you will be given an additional
opportunity to amend your responses so that you can demonstrate your competency to the required level.
You must address the assessor’s feedback in your amended responses. You only need amend those sections
where the assessor has determined you are ‘not yet competent’.
Make changes to your original submission. Use a different text colour for your resubmission. Your assessor
will be in a better position to gauge the quality and nature of your changes. Ensure you leave your first
assessor’s comments in your assignment, so your second assessor can see the instructions that were
originally provided for you. Do not change any comments made by a Kaplan assessor.
We are here to help
If you have any questions about this assignment you can post your query at the ‘Ask your Tutor’ forum in
your subject room. You can expect an answer within 24 hours of your posting from one of our technical
advisers or student support staff.
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Section 1: Case study 1 — Malcolm and Susan Johnson
Background
Malcolm and Susan Johnson are a young couple about to buy their first home. They have been married for
five years and during that time have rented an apartment while also saving for their own home.
They have been looking at properties for the last month and one has really caught their eye, although the
bathroom and ensuite could do with a little work. They had planned on shopping around the various
lenders themselves to find the most appropriate loan for their needs, but as they both work, they have little
time to do the research necessary. And, as they both admit, they have limited knowledge of the loan
products available and might have difficulty in evaluating the options.
They have not paid a deposit at this stage.
On a suggestion from Susan’s brother (one of your former clients) they have contacted you about the loan.
Following is a summary of the details of the property they wish to purchase, the couple’s financial and
employment details, and the loan features they require.
The property
Address: Unit 12, 43 Seaside Parade, Coastville, <Your State>
Purchase price: $490,000
Description: 2 bedroom strata title unit
Agent details: Steven Allstone
Phone: [phone]
Mobile: [phone]
The couple
Current address: Unit 12, 22 Wentworth Lane, Highville, <Your State>
Malcolm and Susan have lived there 5 years
Home phone: [phone]
Funds position
Purchase price: $490,000
Estimated costs: $20,000
Total required: $510,000
Loan: $430,000
Own contribution: $80,000
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Assets
Capital Bank savings account (joint) $92,000
Capital Bank cheque account (joint) $1,600
Holden Commodore SS, eight years old (Malcolm) $25,000
Suzuki Baleno, seven years old (Susan) $9,000
Superannuation — Capital Bank (Malcolm) $28,000
Superannuation — Capital Bank (Susan) $62,000
Household effects (insured value) $40,000
Liabilities
Capital Bank personal loan (Malcolm) $3,600
(repayments $180 p.m.)
Capital Bank Visa card (Malcolm) $200
(limit $2,000)
Capital Bank Visa card (Susan) $600
(limit $3,000)
All debts have been repaid according to arrangements. In relation to the credit card debt, the minimum
monthly commitment should be calculated at 3% of the credit limit.
Income/employment
Malcolm (date of birth 21/2/86)
Position: Team leader (full time)
Employer: ACME Limited
101 City Rd, Westside, <Your State>
Phone: [phone]
Income (gross): $55,000 p.a., net monthly income: $3,705
Employer contact: Alison Johnson, HR Manager
Length of service: 10 years
Driver’s licence: 8855KL
Email: [e-mail]
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Susan (date of birth 8/10/87)
Position: Accountant (full time)
Employer: Phones R Us
804 High Street, City East, <Your State>
Phone: [phone]
Income (gross): $91,000 p.a., net monthly income: $5,629
Employer contact: Stan Adams, HR Manager
Length of service: 12 years
Driver’s licence: 17016C
Email: [e-mail]
Interest income
Approximately $40 per month from $12,000, remaining in savings account after home loan deposit. Interest
4% p.a.
Solicitor’s details
Jones and Co
22 High Street, City East, <Your State>
Phone: [phone]
Fax: [phone]
The loan requirements
• 30-year term
• Premium Option home loan
• standard variable interest rate @ 5.57%
• proposed settlement date — 6 weeks time
• ability to make additional payments from time to time without penalty
• fortnightly repayment option
• redraw facility
• funds access via card
• offset facility.
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Assignment tasks (student to complete)
Task 1 — Initial disclosures
Following a personal introduction, and before you begin gathering information about the clients’ existing
financial situation or needs, there are certain disclosures you are required to make as a finance broker
regarding the way you are remunerated and the range and limitation of your services.
Identify and describe three (3) of these disclosures. (200 words)
Student response to Task 1
The three disclosures prior to the gathering the information from the client are:
1. How the intermediary is to be paid: The process that would be used for the payment to the
intermediaries is to be laid down so that the client has adequate knowledge about the mode of
payment and how it would reduce the time.
2. Who the intermediary represents: It is essential to reveal the client about who the intermediary
represents so that the client has knowledge about whom they are paying the money and does not
go missing.
3. Who the intermediary pays for the referrals: The referrals are paid by the intermediary to the
individuals who are making the referrals and bringing in new clients.
The three disclosures that requires to be mentioned are:
1. Credit Guide: It provides primary data regarding the broker to the consumer. The time of providing
the credit guide is dependent upon the kind of entity the broker is and the what credit operations,
the broker engages in but would be specifically before initiating in the credit operations of the
consumers.
2. Quote: Quote describes the consumers about the anticipated costs before making use of the
services if the fee of the consumer is charged. Before initiating the credit assistance, a quote
requires to be given to the consumers and the consumer requires to accept the quote by signing
the quote.
3. Proposal Document: A proposal document provides the cost to the consumers of making use of the
services that are inclusive of the commission of the broker that they may receive. A proposal
document requires to be given to the consumer during the same time of credit assistance given to a
consumer.
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Assessor feedback: Resubmission required?
You have correctly identified the documents to be provided to the
client at different stages however the question asks you to identify
and describe three disclosures you should make prior to gathering
information from client, not the documents. What disclosures
particularly are included in the Credit Guide? Topic 3.1 page 20 may
also assist.
Refer to MFAA Code Of Practice 2014 on its website and ASIC website:
http://asic.gov.au/regulatory-resources/credit/responsible-lending/
responsible-lending-disclosure-obligations-overview-for-credit-
licensees-and-representatives/
Yes
Task 2 — Gathering and documenting client information
Complete the Client Information Collection Tool located at the end of the assignment in Appendix 1 using
the information provided in Case Study 1.
Note: Any assumptions you make should be listed, and not be in conflict with the case study information
already provided.
You have demonstrated that you are competent regards to this Task.
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Task 3 — Assessing the clients’ situation
1. Based on the information provided in the case study and using the tools available to you
(e.g. loan calculators, including those available on lenders’ websites), provide an assessment of
the clients’ borrowing ability and ability to service the loan they require.
Consider and comment on issues such as:
• borrowing ability in relation to the loan required
• deposit requirements for the loan required
• repayment ability based on the loan required
• likelihood that the clients will be able to meet their financial obligations
• do they require Lenders Mortgage Insurance (LMI), and if so, how much will it cost
• any other issues that may impact, now or in the future, on the clients’ ability to meet their
obligations, including any possible risks.
Provide data to support your comments and conclusions. (750 words)
Student response to Task 3: Question 1
The borrowing capability of Malcolm and Susan cam ne understood easily by assessing their asset and
liabilities statement. It is known that the couple has been married for over 5 years and has being living in a
rented house. They are in the idea of purchasing their own house and therefore has been looking for
various options of loan. They wants to purchase a property that is situated in 43 Seaside Parade Coastville
that has a cost of $490,000 and the Gant name is Steven Allstone. It is seen that the price of the property is
$490,000 and the anticipated costs associated to the property is $20,000 and thus the total cost comes to
$510,000. The amount of loan they want to receive is $430,000 and they have the idea of making a down
payment of $80,000.
The asset consists of $92,000 in the savings account of capital bank which has a value of $1,600 in the
cheque account of capital bank, superannuation of value of $90,000 for the couple as a both. They have
two cars for each of the couple with a value of $34,000 and value of household comprising of $40,000 and
the liabilities consists of the personal loan of $3600 and an outstanding credit card amount of of $800 for
the couple. Malcolm is working in ACME Ltd as a team leader and has annual income of $55,000 and Susan
is an accountant in Phones r Us with an annual salary of $91,000. It has been observed that the total annual
salary of the couple as a whole is $146,000 and the loan interest of 5.575 that results to $2460 per month
and therefore the amount can be paid with ease by the couple. The down payment value of $80,000 can be
paid easily by the couple by observing their annual salary along with the savings account balance and the
superannuation that they possess. The ability of borrowing for the couple is accurate in accordance to their
income as they can bring forth the down payment payment of $80,000 and the rest of the balance can be
taken as a loan as they have the ability to pay for the interest in a simpler manner.
The requirements of deposits of the required loan consists of the identity proof of the person who is taking
the loan, their proof of address, photo, salary slip and government witnessed guarantors, authenticity proof
of the property, collateral securities and and the bank statement of the person who is undertaking the loan.
The ability of repayment is on the basis of the amount of loan required is simple for the couple as they
have adequate bank balance along with the superannuation and their salary is quite good for the
repayment of the loan. It is observed that they have been married for more than 5 years and have been
working for over 12 years so it is estimated that as they are young they have the ability to work for a longer
period of time unless they are down with sickness or any accidents and therefore by looking at the tenure
of loan which has been 30 years, they can pay for their loan in an easy manner. It is even seen that the rate
of interest falls along with the duration of the loan and repayment and therefore the accrued interest along
with the amount of principal annually would be around $2460 per month, which is pretty moderate on
comparison to their monthly income.
The couple have the ability to meet their financial obligations easily as they have a steady income rate
along with the benefit of being young which provides them with the chance to raise their income in the
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