Australian Broker forum is the place for positive industry interaction and welcomes your professional and informed opinion.

ASIC rules licensees must take extra precaution in verifying living expenses

Notify me of new replies via email
Australian Broker | 06 Nov 2014, 08:00 AM Agree 0
Brokers will have to take extra precaution to verify clients' details following an ASIC regulatory update
  • Northern Broker | 06 Nov 2014, 11:24 AM Agree 0
    This is quite ambiguous! In one place it says "verify" living expenses and in another it says "inquire" into living expenses. It is unclear what brokers and lenders now have to do in this regard. Do we obtain a budget? Do we sit down with applicants and check off every expense they have via receipts etc.? How do we verify? Do we get a Stat Dec from the applicants? Until ASIC, or lenders or aggregators, come out and clearly explain what is required, all lenders and brokers will be exposed to a possible litigious event.
  • Papery | 06 Nov 2014, 12:18 PM Agree 0
    and all this points to is that as a private individual, you are no longer ned to be responsible for yourself & the decisions you need to make regarding your present & future needs. The regulators are just pushing us further into the NannyState.
  • Ray Ethell | 06 Nov 2014, 12:20 PM Agree 0
    Is there a publication of what the Henderson Poverty Index includes, as some funders are asking for phone bills and other standard living expenses that were once considered to be part of general living expenses to be now added to benchmark.
  • QEDRisk | 06 Nov 2014, 02:26 PM Agree 0
    Guys there is not really anything new here. This is exactly what QED has been telling brokers all along. This was always implied in the regulatory guide and I knew it. The guide is now simply more "plain English"
    Northern Broker - the requirement is to enquire AND THEN verify. You need to do both. If you're confused give us a call to discuss in 1300817662. Happy to clarify.
  • Phillip Dibben | 08 Nov 2014, 09:48 AM Agree 0
    Simple test: does the clients savings history and or asset base match their surplus income after using the lenders dictated minimum living expenses? If not investigate further. Good due diligence one would have thought.
Post a reply