At a recent Vendor Finance Association meeting the topic of ASIC’s requirement for a ‘needs analysis’ of a potential Instalment Contract buyer was discussed.  More on this subject follows.

What ASIC say

ASIC Regulatory Guide 209 requires ACL holders and Credit Representatives to undertake:
“Reasonable inquiries about a consumer’s requirements and objectives”

It then goes on to say:

“Depending on the circumstances, reasonable inquiries about a consumer’s requirements and objectives could include inquiries about:
(a) the amount of credit needed or the maximum amount of credit sought (for example, the desired limit for a credit card);
(b) the timeframe for which the credit is required;
(c) the purpose for which the credit is sought and the benefit to the consumer; and  
(d) whether the consumer seeks particular product features or flexibility, and understands the costs of these features and any additional risks.” 

A simple way to comply

Based on this guidance from ASIC, the Institute has included a “Requirements & Objectives Questionnaire” in our Application Pack.  Details of this Pack are available at, Click Here

While ASIC don’t oversee Lease/Options (Rent To Owns) in the same way as they monitor Instalment Contracts and Deposit Finance (credit contracts), your Lease/Option buyers are eventually going to need a traditional home loan.  Putting your Lease/Option buyers through the procedures in the Application Pack will help set them up for a successful future loan application.

Cheers,  Paul