Assignment Task

Exercise 1

There are 3 Tasks to this Exercise

Scenario Jonathon is a potential first home buyer who phones your office for the first time and asks you to explain some of the loan options he has heard may be available to him. He wants to know the benefits and disadvantages of each one. He has never used a mortgage broker before but he knows you would not charge him a fee for your services. He does not want to share too much personal information at this stage but indicates he has a good deposit and is ready to start searching for a home for himself. However, he would like a better understanding of: 1) “a nofrills loan”, 2) a professional package, 3) a line of credit, and 4) honeymoon rates.

Task 1

Scenario Part 1:

Complete A, B and C below by typing a single “script” that you would use in response to this enquiry that clearly explains the 4 loan options they have asked about and the benefits and disadvantages of each one.

A. You must cover the caller’s 4 options in your script, as a minimum. – You do not need to improvise further comments or questions from your first home buyer – Your script for this task A should be between 500 to 750 words.

B. In a few sentences, describe to your caller what a mortgage broker does and how you feel you can help them.

C. Close the conversation with the caller with a selling statement (e.g., request for an interview).

Task 2 

Scenario Part 2:

Complete A and B below:

A. Establishing rapport is a crucial step at the enquiry and interview stage. In preparing for your interview and meeting this new client for the first time, list 10 ways you will aim to both establish rapport and begin to build credibility with your new client. 

B. It is also important to understand why consumers patronise different lenders and brokers. Give a brief answer to each of the 5 questions below. Your answers should be based on your own opinion. 

a) Why do borrowers consider using mortgage broking services ie. perceived benefits?

b) What are clients’ expectations when they use a mortgage broker?

c) How do you gain a client’s loyalty?

d) Why would clients use your services again over other mortgage brokers or going directly to a bank?

e) Do you think borrowers are typically presold on a brand or are they more impulsive?

Task 3 

Scenario Part 3:

Complete A, B, C and D below:

The client in this scenario has agreed to meet with you, at their home, and you are now getting ready for your first meeting with this client. The meeting will allow you to determine the client’s needs and to discuss potential loan options. Remember that Jonathon has not yet started to search for the home he wishes to purchase.

A. In respect to your procedures and compliance obligations, there are 3 documents a mortgage broker should have in the first client interview, two of which should be provided to the client. List these 3 documents 

B. List the names of 4 items of legislation or regulations or codes that affect “selling” financial products or services. 

C. Type a brief summary of each of the 4 items you have chosen above. Your summary should be at least 100 words for each item. 

D. Create an audio recording using your mobile phone or similar recording device. Audio only is required, of between 5 and 10 minutes. You do not need to involve a third party, however if you do so, you must ask them to confirm verbally on the recording, that they agree to be recorded. In your recording, you can improvise on background information but you should demonstrate your skills with the following: 

• Create some initial rapport
• Summarise what your role will be, the range of lenders you have access to, how commissions would be disclosed, how technology is used
• Identify your understanding of Jonathon’s current loan-related needs and objectives, and any future financial plans
• Explain the basics of the loan application process, the paperwork required and the expected timing from start to finish
• Provide a description of one or two different loan features that may suit his needs eg. redraw – Advise the client of the next steps if he proceeds, thank him for his time and depart.

Exercise 2

Scenario You are a mortgage broker and your new clients, Mr and Mrs Jackson, aged 44 and 46, have asked you to assist them to obtain a loan for the purchase of a block of vacant land on which they intend to build a home. The land is in a quiet inner residential suburb, is 825m2 , including the driveway, has no special zoning, but it is a “battleaxe” block (see green Lot 2 in diagram below) so the driveway runs beside a friend’s established property (Lot 1) which already has a new house recently built.

Your clients are not ‘first home buyers’ as they have purchased and sold a home before, but they are currently renting at $700 per week. They did not use a broker last time. They indicate that they want to buy the land now but will probably return to you for a construction loan within 24 months. They have not considered building costs or design ideas at this stage and are in no rush to build.

Both employed full-time as doctors, with no children, they have a high combined income, no other loans, and have a 30?posit saved. The purchase price is $450,000 and they are very comfortable with this.

Task 

Please answer the 5 questions below. You must ensure you answer every question. This is a summative task so you will need to draw on your knowledge from throughout the course but in particular Unit 8. 

This Task is about the mortgage broking process. For the purposes of this exercise, you are not required to consider specific financial information. However, you are required to consider the concepts. For example, in Question 3 that follows, “the land value” would be one of the considerations you might list.

Questions 1. Choose and describe the loan product options that you would consider and suggest to the client for their land purchase scenario. Describe how and why your preferred product type would suit this scenario (eg. features).

2. Best Interests Duty and the Conflict Priority Rule are two key aspects of BID legislation, describe these two aspects, including what “acting in a client’s best interests” means. Include a list of 5 actions you would undertake to ensure you meet these requirements whilst performing your mortgage broking duties in this land purchase scenario.

3. List and describe 5 key considerations of this client’s land purchase scenario, that a lender would review on receiving this loan application.

4. Imagine you are going to be showing a new staff member the process of acquiring this client’s information through to lodgement of this loan application to the lender, through to and including settlement of this new loan. You can assume that lender/aggregator software will be utilised for the final submission of the loan application, but your answer should assume your new staff member prefers to refer to generic written guidelines to ensure the correct steps are covered. Complete a) and b) below:

a) Create a Staff Guidelines document, by typing all of the steps in the process, approximately 600 words (a minimum of 1 typed page – you can type into the field provided below or create your own separate document). The written layout should be easy to follow so the new staff member has minimal difficulty in understanding step by step what is required. You may wish to use the table provided in Unit 8 as a starting point for ideas for this written Staff Guidelines.

b) Create an audio recording using your mobile phone or similar recording device. Audio only is required, to a maximum of 5 minutes. In your recording, you should record yourself speaking to your new staff member regarding how the loan application progresses. You are not to read your Staff Guidelines document word for word, you are to summarise the key elements and provide additional examples to enhance their understanding, if required.

Exercise 3

Task 

You must provide an answer to each question. As an indication of the length of responses we are looking for, if a suggested word count is not provided, please use the number of Marks as a guide for answer length.

In some cases we will give you a reference to the unit in which you will find the information you require. In some cases you may need to rely on your understanding from what you have learned from throughout the course topics or undertake a search on the internet.

The questions will also be used to assess your language and literacy skills. The assessor will check all your exercises and assignments to ensure

• that they are accurate with correct grammar and punctuation
• that they are appropriate to the target audience
• that they show planning and organisational skills
• that they demonstrate your ability to search for products and service information and use problem solving approaches to identify customer needs and expectations.

Questions

1. Using information provided in Unit 2, list at least 4 points that are important to ensure communication delivers on customer needs, expectations and priorities. 

2. It is important that staff should deliver an outstanding customer experience at all times. What are the specific behaviours, mentioned in Unit 2, that this requires and how would they be measured? 

3. Using information provided in Unit 2, it is important that an organisation continually improves. How might an organisation collect and document information to facilitate this? 

4. Using information provided in Unit 2, there are many laws that regulate the way businesses may provide service to a client. Why are laws and regulations important and what are your responsibilities? 

5. Write a guide regarding customer service that you would use, as a mortgage broker, to look after a customer. Your guide should be a minimum of 2 typed pages and must include the following points: 

• Identify and clarify customer needs and expectations
• Assess the urgency of the request
• Determine priorities for service delivery
• Inform the customer of possible choices
• Assist in the selection of the preferred option
• Address what action you would take if you were unable to satisfy the customer need
• Seek appropriate assistance where needed
• Provide prompt service to customers
• Establish and maintain rapport with customers
• What action might be taken if there was a complaint
• Provide assistance should there be a specific need
• Propose cross-selling opportunities that may be apparent
• Seek customer feedback
• Review customer satisfaction
• Document recommendations to improve customer service
• Use recommendations to improve customer service

6. Using information from Unit 10 or your own research, please answer a), b), and c) below.

a) Outline how you would undertake a cold call successfully.

b) How would you anticipate building a relationship from a cold call prospect with the outcome of the new client using your financial services.

c) Summarise how you would record the required information after your call has finished.

7. Using information in Unit 11, there is a five point plan to successfully establishing networking. List the five prescribed methods. 

8. A) List 3 types of professionals in the financial services industry with whom you could form a strategic alliance.

B) For each one, include 2-3 sentences as to how the alliance might work. You may find useful information in Unit 11. For example, an Accountant – meeting clients in accountant’s office to provide credit assistance further enhancing the accounting firm’s offering and paying a referral fee to the accountancy firm.

9. Using information in Unit 4, list four different sectors of the financial services industry. For example, a bank may belong to one sector. You must also describe how the sectors interrelate.

10.Visit four different banks’ websites and list one loan product from each website. Plus, list the key features of each of these 4 products.

11.The Banking Code of Practice (ausbanking.org.au) includes an obligation for taking extra care with customers who are experiencing vulnerability 

a) Describe 5 examples of what “vulnerability” could mean in this context

b) Describe what should a broker do if they have identified a potential customer as “vulnerable”? 

12.Brokers must be able to prioritise and manage their work activities and hold themselves and their team members accountable. Assume you are now an established mortgage broker with two staff. The roles of these two staff are your own choice. Refer to information found in Unit 9 and answer the following five questions

a) As a broker in a management role, describe how you might support others to develop their work goals, plans and activities?

b) List 6 ways or KPIs in which competency and performance may be measured

c) List 5 activities you could undertake to contribute to the professional development of yourself and your two staff

d) List 2 tools you can use to track your and your staff’s progress to meet your annual requirements

e) Give 2 examples of ways to manage team health and wellbeing in the workplace.

Exercise 4

Scenario Assume you are now a mortgage broker and you are either working as an independent contractor, or are self-employed or about to open a franchise. Alternatively, you may be a broker who has just joined a business as an employee. If you have not started working in the financial services industry, you will need to anticipate your role as you would see it in the future ie. a simulated workplace environment.

In every situation you need a plan to succeed. As part of this assessment, should you have 2 other staff members working with you (their roles are your choice).

Your plan to ensure you are successful as a broker will include your recognition that attracting and retaining clients will be critical to the business’s short and long term viability. You need to have strategies in mind, techniques you will use, software support ideas, thoughts about your advertising budget and goals to achieve from your commissions. Your goal around the income you desire is a good motivation, so think about how you will achieve that income goal.

You and your team will also have “Continuous Professional Development” requirement hours once you start, so outline this in your plan as it will have time and funding commitments as well as being a compliance necessity.

The course content will have prepared you for understanding the many requirements, including compliance, that are critical for operating successfully in the financial services industry. Long answers may not necessarily be required for all questions. Unit 12 will be a key source of information and you can utilise the internet as required. Units 9, 10 and 11 will also be helpful.

Task 1

Either create your answer as a separate document containing your answers or type your answers into the fields provided for each of the 5 questions that follow:

1. Describe how you would prepare and conduct research for a business plan including the following:

a) The key Acts of legislation relating to business operations that cover how you need to abide by

1. Work health and safety,
2. Equal opportunity
3. Industrial relations
4. Environmental issues.

b) List 3 methods of conducting market research

c) List 2 external resources that could assist you with your business planning.

2. Remaining within the same scenario, define the purpose, goals and objectives of the mortgage broking business in which you are working, with your team members

3. Please answer a) and b) below a) What services or products do you plan to offer (e.g. residential mortgages, investment loans, other loans)?

b) Unit 11 discusses strategic alliances and provides some examples of how a potential alliance could be approached. Suggestions include an accountant, real estate manager, builder, financial planner, etc. From a recent networking conference you have a business card of the manager of one of these businesses. During a lunch-break conversation with him at the conference, this manager indicated he could be interested in developing such a relationship.

With the goal of establishing this new alliance as a new referral source, create an audio recording using your mobile phone or similar recording device, where you call the manager. During the call you should introduce yourself and your business (or who you work for). Remind him of the conference you both attended to establish some common interest. Let him know the reason for your call and that would like to establish a referral relationship. Briefly outline how you would anticipate it working and how it could benefit each business. Conclude the conversation appropriately.

4. Outline the management structure of the business – you may want to create a simple organisational chart/tree showing your mentor, your licensee and your team members – describe where you will fit into the structure.

5. Define your operations by answering the a) to h) that follow:

a) Identify responsibilities both for yourself and for the 2 staff members (eg. admin assistant and a loan processor)

b) Conduct a simple S.W.O.T. Analysis of your business (Strengths, Weaknesses, Opportunities, Threats – explained in Unit 12)

c) Define your target audience (will they be primarily first home buyers, investors, upgraders, other?)

d) What marketing strategies, marketing methods and technology will you use to promote your business?

e) If you were to be needing finance to establish the new business, what sources of funding could you potentially use (e.g. own cash, business loan, investors, other)?

f) What is your 12 months sales goal (Tip: you could answer this as a simple budget plan and/or refer to Unit 12 regarding commission forecasting).

g) List 3 potential risks that you may encounter and therefore need to plan ahead for (include both internal and external risks) and i. what would be your risk management strategy for each of the 3 risks?

h) Outline a simple contingency plan for non-compliance (eg. a compliance requirement that you or a staff member breaches) so you are prepared to address this according to your workplace procedures.

Task 2 

Now that you have answered the questions in Task 1, you’ve done the hard work. Now bring your answers together to use in the Business Plan template we have provided. There are also many tips within the template to use. A timeline of 12 months can be used for your Plan.

Fill in the template incorporating the following 9 items. These items and the layout will already be structured for you within the template. As with Task 1, this template will be suitable for brokers already in the industry, whether employed or self-employed or for those who are aiming to join the industry in the future.

Business plan:

1. Business Purpose ie. Mission

2. Goals and Objectives Professional Relationships

3. Target Market

4. Information Management

5. Financial/Funding Plan

6. Risk Management Strategies

Marketing activities:

7. Networking and developing

8. Marketing Goals and Strategies

9. Client Retention Strategies