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Target Market Determination – Agent Funding Loans

This Target Market Determination (TMD) has been prepared in accordance with the Treasury Laws Amendment (Design and Distribution Obligations and Product Intervention Powers) Act 2019 (Cth) and associated Regulations. TMDs are designed to assist issuers to ensure that the financial products they issue are likely to be consistent with the likely objective, financial situation and needs of the consumers for whom they are intended (the target market) and to assist distributors to ensure that financial products are distributed to the target market.

This TMD is general in nature and should not be construed as financial advice. Consumers should obtain independent advice prior to acquiring the product to ensure that it is appropriate for their objectives, financial situation and needs.

Product

Agent funding loans including Commissions in Advance, Listing Credit.

Product Issuer

This product is issued by Property Credit Pty Ltd ACN 638 329 674, Australian Credit Licence Number 528878

Date of TMD

12 December 2022

Target Market Determination

Description of target market, including likely objectives, financial situations and needs

This product has been assessed as meeting the likely objectives, financial situation and needs of consumers who:

  • Meet the company’s eligibility criteria (including but not limited to):
    • Are over the age of 18 years of age
    • Are an Australian citizen or permanent resident
    • Are a licensed real estate sales agent in the state where the property is being sold
    • Are an employee of the real estate agency
    • Have entered into an exclusive agency agreement with the seller to sell the property
  • Require a line of credit to access funds where sales commission will be received on sale of the property
  • Require the ability to progressively draw funds throughout the sale of the property.
  • Have listed the property on the open market for sale
  • Have received a deposit on the contract of sale in the agency trust account more than the loan amount.
  • Can repay the outstanding loan balance in full:
    • on settlement of the property or,
    • if the property has not been sold within 6 months of the first drawdown, then on the day 6 months after the first drawdown.
  • Can complete the application form online.

Description of product including key attributes

This product’s key attributes include the following:

  • Loan Advance is subject to lending criteria, the loan purpose and point in time during the property sale
  • Loan repayments are the earlier of:
    • 6 months from the initial drawdown or
    • On settlement (sale) of the property
  • Fees and charges include establishment fees, monthly fees and late fees
  • Product features:
    • Online application process
    • Digital Verification Service capability for verification of identity requirements
    • Customer portal
    • Customer support including phone, email and chat capabilities
    • Electronic contract distribution and signature capability

Class of customers for whom this product is not suitable

This product may not be suitable for consumers who:

  • Do not meet our eligibility criteria
  • Do not have the ability to repay the outstanding loan balance in full at the end of the loan term if the property does not sell before the loan term ends
  • Do not hold the appropriate licence to sell a property
  • Have not listed the property on the open market for sale

Explanation of why the product is likely to be consistent with the likely objectives, financial situation and needs of consumer in the target market

The product allows real estate agents who want to access monies they will be entitled to receive on settlement on the property once the property has been listed on the open market for sale.

Consumer must have the objective of repaying of monies on date of settlement.

The product also allows real estate agents to progressively access funds during the sale of the property.

Distribution Conditions

This product can be distributed through the distributors set out below. All distribution channels require an application for the loan to be submitted to Property Credit via its website or the Property Credit sales team.

1. Direct – Property Credit’s website and sales team 

Property Credit staff are required to undertake training prior to assisting applicants with loans and must follow all documented procedures. Property Credit will ask screening questions as part of the application to ensure that a prospective borrower is within the target market set out above. 

Property Credit considers this is an appropriate distribution channel because of the nature of the target market and the requirement for all sales staff to have the necessary training, skills and knowledge to assess whether the consumer is within the target market. 

2. Third Party – Real Estate Agents 

Real estate agencies who have representatives who can refer real estate sales agent employees to Property Credit to assist them with funding sales commissions on property sales. Property Credit will only enter into agreements with real estate agencies who it considers are reputable and who have the necessary licences Property Credit require. 

Property Credit considers this is an appropriate distribution channel due to their industry knowledge and the nature of the target market. 

Review Triggers

The following events are review triggers that would reasonably suggest that the TMD is no longer appropriate: 

  • A significant dealing of the product to consumers outside the target market occurs 
  • A significant number of systemic complaints are received from consumers in relation to the product 
  • There is a material change by Property Credit to the product or the terms and conditions. 
  • There are significant and adverse changes in the credit performance of the product such as overdue payments, defaults or hardship applications.  
  • There are significant changes to Australian credit laws that affect the product. 

Review Period

First review date
6 months after the date of this TMD

Period review
Every 12 months after the initial and each subsequent review.

Trigger Review
Review to be completed within 10 business days of the identification of a trigger event.

Reporting Requirements

The following information must be provided to Property Credit by distributors if they become aware of any of the following matters within the corresponding timeframe.

Type of Information What is reported When it is reported
Product complaints Information relating to complaints received about the product or the distribution of the product, including:
  • Number of complaints
  • Name and contact details of the complainant
  • Substance of the complaint
As soon as practicable and in any event within 10 business days of receipt of the complaint
Feedback Any feedback received about the product or the Distribution Conditions for the product Every 3 months
Significant dealings Date or date range of any significant dealing of the product outside the Target Market As soon as practicable and in any event within 10 business days after becoming aware of the significant dealing

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