BANKING CODE OF PRACTICE APPLICATION GUIDE
Application preparation |
Considerations & Information Required |
| Product choices | Loan & Mortgage – Consumer Chattel Mortgage – Commercial Construction Loan – multiple drawdowns Lease – Finance Lease – Operating Master Lease – Finance or Operating Overdraft Line of Credit |
| Financial position statement | Assets Current financial commitments Profit & loss statements– past & projected Tax returns – individuals PAYG statements – consumers |
| Security on offer | Financed goods – loans Other collateral e.g.property, equipment, shares etc Guarantees – company,directors or individuals |
Financing considerations |
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| Fees and charges | Property searches Broker fees Agent fees Legal fees Council/Government approvals Valuers |
| GST implications | Upfront or over term |
| Ownership or lease | Loan = ownership Lease = hire/rental* * There may be an option to buy at the end ofthe term but that is a separate contract and subject to negotiation |
| Maintenance arrangements – purchased/leased equipment | Financed or separate |
| Depreciation & risks | Impact on asset value at end of contract – lease implications for residual |
Documentary requirements |
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| Identification – Company, Trust and Individuals | Company ACN/ABN Trusts – Trust deed Directors, trustees and individuals –personal ID |
| Financials | Profit and loss statements Tax returns Bank statements PAYG – year to date pay slips Business plan & projections |
| Other – dependent on purpose | Plans – construction Environmental approvals Photographs Valuations |
The application process |
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| Completion of application with all supporting documentation | Documentation must be complete before the application will be accepted and processed |
| Submission to chosen lender | Bank preference – decision may be based on your key requirements e.g. bank reputation, interest rate, processing timelines etc |
| Bank credit assessment processes | Identification, verification and risk assessments of entities and individuals involved Politically Exposed Persons& Sanctions Checks Credit Reporting Body Checks– corporations, directors and individuals Trading history, cash flow and financials review and verification of information provided Market indicators assessment Environmental & other approvals granted, where relevant Bank credit criteria applied |
| Credit decision | Approved Conditioned – further negotiations required Rejected |
Timelines |
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| Standard processing times | Average time = Same day to 4 business days dependent upon circumstances. |
| Possible delays | Incomplete documentation Additional documentation required Terms and conditions to be renegotiated e.g. finance amount, interest rate, term, repayments structure etc Additional security required Environmental and other approvals to be provided |
Contract formation |
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| Documents | Contract – loan/lease Guarantee – corporate or individual Payment methodology approval e.g. direct debit |
| Legal advice | Recommended |
| Acceptance and signatures | Authorised third party,directors or individuals |
| Settlement date | By agreement |
