Powered by MOMENTUM MEDIA
the adviser logo
Lender

Lender adopts ‘stricter’ compliance guidelines

by Reporter5 minute read
Homestart

A South Australian-based lender has announced that it will launch a new compliance model designed to ensure that mortgage applications meet “stricter nationwide criteria”.

HomeStart Finance has revealed to brokers that it will launch its new “Lending Governance Model” on Thursday, 4 April 2019.

To continue reading the rest of this article, create a free account
Already have an account? Sign in

According to the lender, the model was designed in consultation with mortgage aggregators to ensure that home loan applications “meet responsible lending expectations common to most lenders” and that they are processed in line with HomeStart’s “Service Level Agreement” commitments.

HomeStart added: “It is also designed to manage serious incidents, if they arise, in a specific, measurable and objective way.

Advertisement
Advertisement

“We have enhanced our supporting activities to help our brokers submit quality applications, which will provide customers with better experiences and outcomes.”

“This model will target specific areas of omission or error in lending applications, which stem from a breach of compliance and responsible lending obligations to your [broker’s] customer, your aggregator and your lender.”

HomeStart noted that once the model is launched, brokers must submit loan applications with the following to avoid “serious incident”:

  • full disclosure of debts
  • evidence of customer capacity to repay the debt
  • verification of customer stated living expenses
  • customer ID certified
  • privacy consent and declaration forms signed

The lender added that if the criteria are not addressed or are addressed in error in any application, the below escalating process will apply:

  • First incident - First formal notification
  • Second incident - Second formal notification (aggregator notified)
  • Third incident - Accreditation temporarily revoked (aggregator notified), with brokers required to re-sit the HomeStart’s responsible lending/compliance module
  • Fourth incident - Business development specialist meeting for explanation around severity of the situation (aggregator notified/involved)
  • Fifth incident - Suspension of HomeStart accreditation, with a recommendation to aggregator to consider permanently revoking broker’s HomeStart accreditation

The new compliance guidelines will apply for all new applications lodged from Thursday, 4 April.  

[Related: SA lender joins Aussie panel]

Lender adopts ‘stricter’ compliance guidelines
yelp homestart ta
TheAdviser logo
yelp homestart ta

JOIN THE DISCUSSION

You need to be a member to post comments. Register for free today

MORE FROM THE ADVISER

mark lewis fast ta llosc4

In Memoriam: Mark Lewis, 1963–2022

Mark Lewis passed away on Saturday (13 August). Mr Lewis was a well-known identity in the third-party broker...

READ MORE
anthony waldron mortgage choice ta ithtxm

Broker expertise key for securing right loan: Mortgage Choice

The data, which is derived from a June survey of 1,002 broker customers and conducted by Honeycomb Strategy,...

READ MORE
Mark Bouris new ifa

Brokers need to focus on the ‘value-add’: Mark Bouris

With competition among brokers increasing as the number of brokers rises – coupled with the fact that fewer...

READ MORE
magazine
Read the latest issue of The Adviser magazine!
The Adviser is the number one magazine for Australia's finance and mortgage brokers. The publications delivers news, analysis, business intelligence, sales and marketing strategies, research and key target reports to an audience of professional mortgage and finance brokers
Read more