New Laws Now in Place

To Our Valued Introducers,

Well July 1, 2010 has rolled on by and we are now all governed under the new Credit Licensing regime. The big question we are being asked is how does this affect short term Caveat Loans?

Basically there are only a couple of relatively small changes. These are....

1. We can still lend on commercial AND residential property, as long as the purpose of the loan is for BUSINESS PURPOSES only^. We can no longer lend for "Investment Purposes", ^EXCEPT when the borrower is a Company or where the "Investment Purpose" relates to the purchase or renovation of a Commercial Property.

2. We need some specific evidence of the actual business purpose. We can no longer rely on a Declaration of Purpose being signed by the borrower. ASIC want you and us as the lender to be able to verify what the borrower is using the funds for. In most cases, this should be very easy.

IN SUMMARY, if the borrower is a Company or Trust, pretty much nothing changes. If the borrower/s is an individual, then the loan needs to be for business purposes only or to transact on a Commercial Property.

For more info, check these 2 webinars.

MFAA Webinar 

ASIC Webinar (you need to go through a simple 1 minute login process to access this one)

How to Set a Caveat Loan After 01/07/10

In closing, I hope this is of assistance to you, and don't forget to keep those caveat loans coming!!!

Best regards
Paul Stone
Director

HomeSec Finance Express Pty Ltd - Australia’s Fastest National Caveat Lender

Tel: (03) 9017 6611
Fax: (03) 8648 6328
Email: pauls@homesec.com.au
Web: www.homesecbrokersupport.com.au

Head Office:
6 / 170 Underwood Rd
Ferntree Gully Vic 3156