ASSESSMENT TASKS - ASSIGNMENT 1 Page 2 ASSIGNMENT 1 Task Using the information contained in the Scenario below, please complete the following 6 tasks. You must complete each task for your submission to be assessed. Omission of any of these 6 tasks will be regarded as 'Working Towards Competency' and you will then be required to resubmit in full. 1. 9'5"pr Complete the Fact Find document on these clients using the form in Appendix 14. 0 We have not included all supplementary information on these clients in which case you will need to create your own \"improvised\" answers for inclusion in the Fact Find docu- ment. Trainees who already have access to their own version of a Fact Find template may use their own form as an alternative to that provided in Appendix 14. Recommend a product for the clients and explain your reasons for recommendation List the supporting documents that would be needed to support the loan Complete loan costing sheet * Complete a loan servicing calculation (NSR) * Complete a loan application form (an ANZ loan application form has been provided for you, which you must use) and complete all of the accompanying documents as pro- vided for you. Your answer to this task should be prepared as if you were submitting a real loan application to the lender. Please note: If there is information required on the ANZ application form that is not supplied, please improvise. The application should be completed as neatly as possible to ensure ease of review. It is to be submitted to NFI as if NFI is the lender and you were an accredited broker (but you do not need to make up \"dummy" supporting documents eg. rates notice, etc.). If you do not submit in a professional manner, your assessment will not be marked. * Important: The fees and costs required in order to complete this assignment correctly (ie. Esti- mate of Costs worksheet) can be found in Unit 6 and the instructions for how to complete the NSR form are in Unit 7. A Lenders Mortgage Insurance Chart (if you determine LMI is applicable) is found in Unit 6. Trainees should ensure Units 6 and 7 are used to source correct gures for this assignment. Scenao Clients: Jennifer Ann Stern DL No.: 527491 DOB: 07/07/89 Australian Passport No.: L94325880 Scott Milo Stern DL No.: 5489701 DOB: 04/06/88 Australian Passport No.: L9189081 Contact Phone No: Phone 0401 101 111 Current Address: 33 Willow St, Lane Cove, NSW 2066 Time there, 3.7 years Previous Address: 44 Roberts Street, Putney NSW 2112 Time there, 5 years. Children: 2 children aged 6 and 8 Scenario Continued overleaf 2022 The National Finance Institute V.080322 ASSESSMENT TASKS - ASSIGNMENT 1 Page 3 ASSIGNMENT 1 Continued Existing Property: Own Home valued at $1,500,000 Current outstanding loan balance $375,000 (with CBA) Loan Repayments $2,273 per month, remaining loan term 20 years Cash: The clients have $12,000 cash in the bank. Credit Cards: ANZ Visa - $6,000 limit (balance $4,000) NAB MasterCard $6,000 limit (balance $2,500) Other: Mr and Mrs Stern each have $85,000 in superannuation and they estimate their current home and contents to be worth $63,000 Mr Stern works at OfceWorks as a Marketing Manager and earns $125,000 p.a. He has worked there for 8 years. Mrs Stern is a Project Officer with SMEC Australia and earns $76,000 p.a. She has worked there for the past 3 years after having several years of home duties. The Stems own two cars a 2016 Honda Civic worth $18,000 unencumbered and a 2018 Mazda SUV $30,000 subject to Mazda Finance of $20,000 ($450 per month). A few days ago, the Sterns signed up for a 20 month Interest Free loan from Latitude for a sound/movie system for $3,000. They paid a $50 establishment fee to avoid the monthly ad min fee and their minimum monthly payment is 5%. You interviewed Mr and Mrs Stern at your office after some initial telephone conversations previously. They both spoke good English, they are Australian citizens of more than 20 years and they expressed their excitement at buying their second property. Following your evaluation, you suggested 3 different loan products to the Sterns and their decision was to choose the ANZ product. You will now proceed to assist them with their loan application. They are aware that, they will need to complete a Customer Identication Procedure prior to finance approval from the lender. The clients wish to refinance their current home loan and purchase an investment property. The investment property is an established 2 bedroom unit in a residential tower block of 48 at 56 (Lot 6) Victoria Ave, Rhodes and is valued at $900,000. Gross rental Income of $700 per week is expected and the body corporate expense will be just $35 per week. They have made an offer on the unit at the asking price, have put down a $1000 cash deposit with the real estate agent, and the offer has been accepted with settlement in 60 days. Title particulars: Lot 6, Folio 4981, Vol. 2931. The solicitors they will be using are Bader & Partners, ph 0400 111 222 Scenario Continued overleaf 2022 The National Finance Institute V.080322 ASSESSMENT TASKS - ASSIGNMENT 1 Page 4 Assumptions: ASSIGNMENT 1 Continued Assume this is a cross collateralised loan Due to the client's request below, assume this structure will be a Split facility Your clients have told you: that they want to keep the repayments on their home separate from their investment property. They would like to keep the repayments on their home as principal and interest but want to pay interest only on their investment property. Lenders will calculate servicing using the entire loan amount calculated at P&I, even if the loan or part of the loan is provided as Interest only. Assume the clients seek a 25 year term for the loan and the lender will assess servicing at P&I over the 25 year term. The clients wish to pay out their personal loan on the car, as a debt consolidation, to rationalise their loan repayments. They have agreed that ANZ will be a suitable lender for their circumstances. Although addresses show NSW, for the purpose of your duty and other cost calculations, assume that the clients live in the same state as you (the broker). You should assume a Standard Variable Rate of 3% applies to this loan application and a Qualifying rate of 3% is added to the Standard Variable Rate (for your NSR form). Assume the current car loan will be paid out by the refinance of the home. Assume the clients will be \"fulldoc\". Assume that the body corporate cost is included in living expenses and therefore does not need to be included as a se arate out oin . Please note: The table called Living Allowances on the NSR sheet is based loosely on the Henderson Poverty Index and should be used in these assignments, including in the Fact Find form, as we are not using a real client. However, in real life ASIC has ruled that a budget must be completed for each client to assess living expenses (we provide a sample budget form at the back of Appendix 320 for interest). 2022 The National Finance Institute V.080322 ASSESSMENT TASKS - ASSIGNMENT 1 Page 7 ASSIGNMENT 1 Continued 4. Complete the loan costing sheet below Estimate of Costs Worksheet - Purchase/Refinance Client/s Name: Owner Occupier: O Yes No Lender (if chosen): Estimated Costs (all items required): Lender's Loan Establishment/Application Cost (required) Valuation cost (required) Property Transfer Stamp Duty Solicitor/Settlement Agent/Conveyancing Charge Registration of new Mortgage Register of Transfer of Title Title Search Lands Dept Discharge of old Mortgage (required) Old Lender's Settlement fee (required) Miscellaneous Costs/Buffer (required): - Other ..... - Other ..... LA - Other ........ SUB TOTAL Lenders Mortgage Insurance (if applicable) TOTAL COSTS $ Summary Purchase price of Investment property Plus Current Home Loan Amount owing Plus 2 months' repayments on Current Loan (ie. 2 x monthly repayment) Plus Total Costs (from above) Plus Total Other Debt Consolidations Less Any Deposit Paid (if applicable) Equals Total Funds Required $ LVR: Total Funds Required $ + Client's Total Security Value $. Equals LVR Client Signature: ....... Date: ............. 2022 The National Finance Institute V.080322