Preparing for BID - Risk/Benefit Statements

Updated by Caroline Pollard

Preparing for BID -  Risk/Benefit Statements

  

In preparation for the introduction of Best Interests Duty (BID) on 1 January 2021, we'll be providing regular tips on best practice in Chief. 

This week we are focusing on the 'Risk/Benefit Statements' section in Chief. 

RG 273 highlights the importance of educating your clients during the credit assistance process so they can make an informed decision, including whether to apply for the product/s recommended with your assistance.  You may find that some loan features need to be explained frequently, to multiple clients. To assist you, MLB Compliance has developed a range of Risk/Benefit Statements to support and demonstrate the client education process about these loan features.

Risk/Benefit Statements The Risk/Benefit Statements in Chief cover the risks and benefits of the following loan features:

  1. Basic variable rate loans
  2. Fixed rate loans
  3. Interest only loans
  4. Introductory rate loans
  5. Line of credit
  6. Offset account facilities
  7. Variable rate loans
  8. Redraw

 

 When you select the Risk/Benefit Statements, they will be included in the 'Preliminary Assessment & Credit Proposal'.

 

This can assist you with educating your clients so you can have an informed discussion and be confident that you're acting in their best interests. Furthermore, this will ensure the clients understand the particular loan product you're recommending and how this meets their requirements and objectives.

Your Chief Training Manager is Santosh Mathew who can be contacted on 03 7020 9482 or support@mylocalbroker.com.au.

For any queries about your BID obligations, please contact Todd Disney, Head of Compliance via email on todd.d@mylocalbroker.com.au. 

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Kind Regards, MLB Support

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