Task 26 ― Preparing the loan for settlement

Although a broker does not participate in the settlement process, they still need to remain in touch with all the stakeholders until the loan settles. Before the loan can settle the borrower needs to adhere to pre-settlement conditions. 

Task 26: Question 1

In the pre-settlement phase, there are items that need to be checked and satisfied. For each one, explain why it is required (i.e. what is the importance of each of item):

(a) building insurance

(b) independent legal advice.

Task 26: Question 2

Explain the settlement process to the client, include the personnel who are involved at each step.

Task 26: Question 3

Explain a minimum of four (4) examples of issues that can occur which may delay or prevent a settlement. 

Task 26: Question 4

Explain the steps in the process of registering security documentation.

Hint/Tip:

In addition to the topic notes, you may also be required to undertake your own research.

Task 26: Question 5

When the lender is ready for settlement, they will contact the borrower’s solicitor and inform them of the expected settlement date, and request details of funds to be distributed at settlement.

The lender will then prepare a pre-settlement costing sheet and forward to the borrower’s solicitor in preparation for settlement. With the broker working closely with the borrower’s solicitor, when they receive a copy of the costing sheet, the broker can then make sure that all the particulars are correct.

For this task you are required to prepare the following pre-settlement statement for the purchase of the investment property for Ravi and Alice Patel.

Task 26: Question 6

You are now at the closing stages of the loan process with this client.

(a) How and where do you file the information you have communicated with them?

(b) Once the settlement concludes, what else would you do to ensure you communicate with this client effectively?