The attached documents have been revised from earlier versions you may have seen. The main changes since the early version relate to clause 9.1 and 9.2 dealing with disclosure of commissions by "non-bank lenders".
Many of the submissions previously made by the MIAA / Gadens Lawyers have been incorporated into the draft Code. Most commentators seem to agree that the Code now forms a workable regime except for a few remaining issues.
The key outstanding issue is the requirement for commission / margin disclosure by "non-bank" lenders who distribute direct to the public (ie not through brokers). Remember, the Code applies to non-UCCC loans as well as UCCC loans. Unless addressed this could have a major impact on mortgage trusts and securitised lenders.
Example: Big Mortgage Trust is managed by Trust Manager. Trust Manager markets loans direct to borrowers. Under clause 9.6, Trust Manager would be obliged to disclose their commission/margin. This is inappropriate as these trust managers are properly viewed as the lender's manager and so part of the "lending team".
If you want to contribute to the debate, please email either:
Jon Denovan firstname.lastname@example.org Calvert Duffy, MIAA: email@example.com
The Code does not deal with the requirement to be a licensed finance broker in WA. Submissions regarding the impact of licensing on (primarily East Coast based) mortgage managers, trust managers, securitisation managers, and aggregators are being progressed separately.
t (02) 9931 4927
t (02) 9931 4753
t (03) 9617 8538
t (03) 9617 8596
This publication is provided to clients and correspondents for their information on a complimentary basis. It represents a brief summary of the law applicable as at the date of publication and should not be relied on as a definitive or complete statement of the relevant laws.
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