In this document the information has been provided to fill Certificate IV for Mortgage Loan. Due to lack of information number of fields have been left vacant. It is important to note that the monthly food and other expenses have been assumed to complete the document (Reed, 2016). In respect of various fees where no particular information has been given it has been assumed no such fees are required to be paid for the mortgage loan.
Exercise: Glenworth Net Disposable Income ratio (NDI) for the applicant is 0.61 (as can be seen in the calculation
Step 2:
Maximum borrowing capacity for these applicants is $500,000.
Q4.10:
Credit guide is to be used to obtain borrowers instructions.
Q5.17:
In Property Registration office in NSW titles interests are registered. Option (b) is the correct option.
Upfront after settlement:
Upfront after settlement of 0.715% is to be paid which will be (450000 x 0.715%) = $3,217.50 (Mailer, 2015).
Ongoing each month:
The largest monthly payment would be (450000 x 0.165%) = $742.50.
|
Estimated total fees payable |
|
|
Application fee: |
0 |
|
Lender’s mortgage insurance |
0 |
|
Valuation fees |
0 |
|
Rate lock fee |
0 |
|
Transfer duty |
0 |
|
Settlement fee |
3217.5 |
|
Discharge fees |
0 |
|
Legal fees |
1500 |
|
Other fees |
250 |
|
Total |
4967.5 |
Task 1: Loan application:
Assets and liabilities:
|
Assets |
Amount ($) |
Liabilities |
Amount ($) |
|
Motor vehicle: |
|
Car loan |
6,000.00 |
|
Holden Commodore |
18,000.00 |
Credit Card liability |
8,500.00 |
|
Investment in shares |
15,000.00 |
|
|
|
Cash (including savings ) |
125,000.00 |
|
|
|
Superannuation |
118,500.00 |
|
|
|
Other asets |
60,000.00 |
|
|
|
Total |
336,500.00 |
Total |
14,500.00 |
|
Future monthly repayments |
|
||
|
Particulars |
Amount ($) |
Amount ($) |
|
|
Total net monthly income (A) |
7,047.00 |
|
8,456.40 |
|
Current monthly living expenses |
|||
|
Food / house keeping |
1,200.00 |
|
1,320.00 |
|
Insurance |
150.00 |
|
165.00 |
|
Transport |
250.00 |
|
275.00 |
|
Education |
400.00 |
|
440.00 |
|
Dependants support |
300.00 |
|
330.00 |
|
Entertainment |
150.00 |
|
165.00 |
|
Other |
400.00 |
|
440.00 |
|
Current monthly living expenses |
2,850.00 |
Future monthly living expenses |
3,135.00 |
|
Current monthly expenditure in total |
4,750.00 |
Future monthly expenditure in total |
5,321.40 |
|
Net surplus per month (Total) |
2,297.00 |
Future Net surplus per month (Total) |
1,725.60 |
Task 1: Loan Application:
|
Assets |
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Address |
State |
Postcode |
Value |
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Property 1 |
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Property 2 |
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Property 3 |
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Property 4 |
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|
Make |
Model |
Year |
Value |
|
|
|
Vehicle 1 |
Holden Commodore |
Commodore |
2011 |
18000 |
|
|
|
Vehicle 2 |
Holden Barina |
Barina |
2009 |
8500 |
|
|
|
House contents |
|
|
60000 |
|
|
|
|
Shares / others |
|
|
15000 |
|
|
|
|
|
Bank |
Branch |
Value |
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Cash at bank |
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Account 1 |
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Account 2 |
|
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|
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Others |
1 |
|
|
|
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Savings |
2 |
Westpac |
|
75000 |
|
|
|
Savings |
3 |
St. George |
50000 |
|
|
|
|
Superannuation |
|
|
110000 |
|
|
|
|
Misc. |
|
|
|
|
|
|
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Are you a guarantor for any other loan |
Yes |
No |
Total |
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|
Liabilities |
|
|
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|
|
|
|
Home loans |
Lender |
Limit |
Int. rate |
Total owing |
Min. monthly |
To be paid |
|
Property 1 |
|
|
450000 |
|
|
|
|
Property 2 |
|
|
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|
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Property 3 |
|
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Property 4 |
|
|
|
|
|
|
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Personal loan / leases |
Lender |
Limit |
Int. rate |
Total owing |
Min. monthly |
To be paid |
|
Car loan |
|
|
|
|
400 |
|
|
Credit cards |
Bank name |
Limit |
Int. rate |
Total owing |
Min. monthly |
To be paid |
|
Bank 1 |
Westpac |
10000 |
18% |
8500 |
300 |
|
|
Bank 2 |
|
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|
|
|
|
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Bank 3 |
|
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|
|
|
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Retail store cards/ interest free facility |
Limit |
Int. rate |
Total owing |
Min. monthly |
To be paid |
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Card 1 |
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Card 2 |
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Total owing |
Min. monthly |
|
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Rent / Board |
|
|
|
1300 |
|
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Tax liability |
|
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Family maintenance |
|
|
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HECS / HELP payments |
|
|
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||
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Supplementary living expenses |
Not Applicable |
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Details of solicitor |
Already provided |
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Security |
|
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Property details |
Home |
Name to be on the title |
Applicant 1 |
David John Willis |
Applicant 2 |
|
Purchase price |
500000 |
Purpose |
Owner occupied |
|
|
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Property address |
NSW |
|
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Suburb |
|
State |
NSW |
Post code |
2170 |
|
Contract for access |
Phone |
404121141 |
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Applicant 1 |
David John Willis |
Applicant 2 |
Jasmine Marry Willis |
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Category A |
Category A |
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||
|
Number |
123456 |
Number |
456789 |
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|
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Place of issue |
NSW |
Place of issue |
NSW |
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Date of issue |
Date of issue |
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||
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Expiry date |
Expiry date |
|
|
||
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DOB |
May 05,1980 |
DOB |
15-Mar-82 |
|
|
|
International passport (current) |
International passport (current) |
||||
|
Number |
NA |
NA |
|
|
|
|
Country |
Australia |
Country |
Australia |
|
|
|
Date of issue |
Date of issue |
|
|
||
|
Expiry date |
Expiry date |
|
|
||
|
DOB |
May 05,1980 |
DOB |
15-Mar-82 |
|
|
Step 2:
As requested the “offset” account is a special account where,
A borrower’s saving bank account or transaction bank account is linked with his home loan account to ensure payment of less interest on the home loan. The proportion of account balance, i.e. savings account or transaction, is offset against the home loan of the borrower on a regular basis and only the difference between the loan amount and the offset amount is considered for charging interest (Liu & Roca, 2015).
|
Step 5 |
|
|
|
Monthly financial position |
Current |
Proposed |
|
Monthly after tax income in total (A): |
7047 |
8456.4 |
|
Monthly loan repayments in total / rent (B): |
1900 |
3200 |
|
Monthly living expenses in total ©: |
2,850.00 |
3,135.00 |
|
Monthly net surplus in total (A- B-C) |
2,297.00 |
2,121.40 |
|
Reasonable estimate of commission |
Up-front after settlement |
|
|
|
We estimate this to be $ |
3217.5 |
|
|
The largest payment is estimated to be |
742.5 |
|
Income and expenditure |
|
||
|
Future monthly repayments |
|
||
|
Particulars |
Amount ($) |
Amount ($) |
|
|
Total net monthly income (A) |
7,047.00 |
||
|
Current monthly living expenses |
|||
|
Food / house keeping |
1,200.00 |
|
1,320.00 |
|
Insurance |
150.00 |
|
165.00 |
|
Transport |
250.00 |
|
275.00 |
|
Education |
400.00 |
|
440.00 |
|
Dependants support |
300.00 |
|
330.00 |
|
Entertainment |
150.00 |
|
165.00 |
|
Other |
400.00 |
|
440.00 |
|
Current monthly living expenses |
2,850.00 |
Future monthly living expenses |
3,135.00 |
|
Current monthly expenditure in total |
4,750.00 |
Future monthly expenditure in total |
5,321.40 |
|
Net surplus per month (Total) |
2,297.00 |
Future Net surplus per month (Total) |
1,725.60 |
No details regarding the International Passport is available thus, no information in international passport segment (Campbell & Cocco, 2015).
Campbell, J. Y., & Cocco, J. F. (2015). A model of mortgage default. The Journal of Finance, 70(4), 1495-1554.
Liu, B., & Roca, E. (2015). What drives mortgage fees in A ustralia?. Accounting & Finance, 55(3), 861-880.
Mailer, C. (2015). The Frankenstein Mortgage: Conceptual inconsistency and the quest for legal coherence in the Torrens system.
Reed, R. (2016). The relationship between house prices and demographic variables: An Australian case study. International Journal of Housing Markets and Analysis, 9(4), 520-537.
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