Important Terms..
Understanding words used in Lending is so important we’ve put it all here in black and white.
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Initial Fees and Charges
- Establishment Fee – This is the fee associated with establishing your loan, including processing and approving your loan application, identity verification requirements, affordability assessments and analysis, risk and collateral analysis, anti-money laundering and terrorism financing procedures, documenting the loan, providing and explaining the documentation to you and any other party in full and then providing you (or third parties) with the loan funds once you have signed up and returned all documentation.
- PPSR Search – This is the cost to us of searching the Personal Property Security Register before accepting you as a client, or your collateral for use on your loan.
- PPSR Registration – This is the cost to us of registering or amending changes to your loan and/or collateral on the Personal Property Security Register once your loan is drawn down.
- Centrix Credit Enquiry – This is the cost to us of checking your credit history with Centrix. This is our preferred credit bureau, but if enough information cannot be provided by them to allow us to approve your application, we may choose an additional credit information provider.
- Equifax Score Enquiry – This is the cost to us of checking your credit history with Equifax Limited.
- Centrix Wheels Report – This is the cost to us of checking your vehicle collateral with Centrix.This is our preferred credit bureau, but if enough information cannot be provided by them to allow us to approve your application, we may choose an additional credit information provider. Wheels Report & PPSR Fee’s include a search of the PPSR. Wheels Report Base Fee do not include a search of the PPSR
- Autocheck Plus – This is the cost to us of checking your vehicle collateral with Equifax Limited.
- E-Documents Fee – This is the cost to us of providing your loan disclosure documentation, or repayment forms to you via our secure third party provider – Secured Signing.
- E-Bank Fee – This is the cost to us of collecting your bank statements electronically via our secure, third party provider Credit Sense. This fee may arise during an application or ongoing via a Credit Fee, where we are required to re-assess your affordability.
- Biometric Verficiation – This is the cost to us of biometrically verifying an individuals identity via a third party provider called APLYiD.
- Valuation Fee – This is the cost of carrying out a valuation assessment on your personal goods, vehicle, or other collateral which you wish to use as collateral (security) against a loan with us, and is the cost applicable to each site visit. This is a location dependent fee, which pass on to the consumer at cost. The cost will vary depending on where you live and which company Real Finance contracts its valuation services through third party providers in your area. Upon enquiry, we can provide you with the price of this fee in advance of any application you may make.
- Certificate Of Title Search Fee – This is the cost to us of searching the title of any property which you intend to use as the collateral for your loan.
- Legal Fees – This is the cost of any legal work which is required to occur in order to determine the outcome of your loan application, and any legal documentation required. This includes mortgage or caveat registration on property which is to be the collateral for any loan.
Credit and Administration Fees
- Monthly Administration Fee – This is the monthly cost of keeping your loan account active, including providing you any mandatory loan statements, running &/or receiving &/or placing repayments, ongoing AML-CFT compliance (including transaction and account monitoring), account & collateral maintenance and any other administrative tasks needed, and is debited to your account at the end of each month where your account has an outstanding balance.
- Loan Statement Fee – Real Finance is required to provide you with Loan Statements every 6 months. A Loan Statement fee is charged only where you request a loan statement, either for yourself or for another company additional to this.
- Full Prepayment Fee – Where you (or another company) settle your Loan more than 14 days before the loan is contractually due to finish, this fee covers the cost of closing the loan, cancelling any security held, and (if necessary) notifying any company concerned that the loan has been closed.
- Contract Re-documentation Fee – When a variation or assignment is made on your loan. This fee is debited to your account at the time Real Finance consents to the variation or assignment.
- Collateral Amendment Fee – Where you request that we change the collateral which we hold as security for your loan, this is charged to cover the administrative cost (only) of amending your loan contract.
- Loan Withdrawal Fee – Where you request, and we approve an additional loan advance under an existing loan contract.
Default and Enforcement Fees
- Monthly Default Fee – Charged each month (part charged weekly in arrears) that your loan account is in arrears. This fee compensates us in part for the resources required to enforce the terms and conditions of your account should you enter into default including contacting the parties to the loan, and dealing with outcomes. The fee can be avoided all together by maintaining your account in an up to date state.
- Sms (Text) Message Fee – For each time we contact you via SMS about any breach of your loan.
- Telephone Call Fee – For contacting you or another party to the loan (or a related party) via telephone (landline or mobile) about any breach of your loan agreement.
- Consumer Monitor Fee – Where Real Finance has a Consumer Monitor loaded against you with Equifax Limited or another credit bureau, and they notify us of an update to your credit file, which we then act on.
- Letter Fee – Where we send you correspondence about your loan arrears or other breach of contract.
- Legal Notice Fee – Where we send you a legally binding notice about the enforcement of your loan account, due to arrears or other breach of contract.
- Payment Reversal Fee – When a payment made onto your Loan is reversed (dishonoured), we may charge this fee to receive the notification from your bank, process the reversal and notify the borrower/s.
- Travel Fee – Where one of our staff has to visit you (or any Guarantor) or attend any meeting in relation to your loan.
- Home Visit Fee – Where one of our staff has to travel to visit you (or any Guarantor) in relation to any breach of your loan contract.
- Default Time Fee – For time spent administering your account, if in non-financial default or any other breach of your loan contract.
- Enforcement Fees – For any costs of Repossession, Court Action, Debt Collection, Legal Action etc.
Other Important Terms
- Address For Service – An address that is given to deliver legal documents. If the document is delivered to that address it is considered to have been delivered to the party.
- AML-CFT Act 2009 – The Anti-Money Laundering and Countering Financing of Terrorism Act 2009 – This is a multi-industry piece of legislation designed to reduce/eradicate the potential for criminals to use New Zealand businesses to launder the proceeds of criminal activity or the funding of terrorism. To ensure compliance, Real Finance asks relevant questions and needs them answered to our satisfaction, including identity verification, income analysis, source of wealth, etc to be able to approve lending to individuals and companies alike. Contact our team to find out more.
- APLYiD – is a technology provider which Real Finance uses to bio-metrically verify our customers to satisfy some of our legislative identification responsibilities.
- Baycorp – In the event that you fail to repay your loan as your contract sets out, and if you do not make suitable arrangements with us about this, we may load your debt with Baycorp, a debt collection company who will chase the debt for us. The cost of this is added to your account balance, so please contact us rather than letting your loan account head in this direction!
- Centrix – We use Centrix, an emerging leader in providing comprehensive credit information in New Zealand to assist us in making good lending decisions for both our clients and ourselves. We also use Centrix to upload and download comprehensive credit reporting data.
- CCCFA Act 2003 – The main legislation governing credit contracts (loans) between Consumer Borrowers and Lenders. This does not govern lending for Investment or Business purposes. The act can be found here (opens in a new window)
- Collateral – In our lending agreements, collateral is your pledge of specific property to us to secure repayment of your loan. Collateral serves as protection against you defaulting – that is, it can be used to offset the loan balance if you fail to pay the balance owing under the terms and conditions of your contract. If you default on your loan, you may have the property pledged as collateral repossessed, with the lender then becoming the owner of that property to sell and recover part or all of the loan balance.
- Current Balance – This is the exact balance on the date you received the figure. It is made up of the amount you borrowed, any fees, charges, interest, default fees or default interest which have been added to your account, minus any repayments which you have made against the account up until that date. It does NOT include any fees, charges, interest, default fees or default interest yet to be accrued and added to your account, and it is NOT the amount needed to settle (or finish) the loan.
- Draw Down – When you complete the Loan Contract Documentation, and funds are transferred from our bank account to yours (or the third-person or company who you have requested we disburse funds to), or paid out to you in cash.
- E-Bank – To speed up our approvals for you, we offer Electronic Bank Statement Collection through our third party provider Credit Sense. This is highly secure, and works for all major NZ banks (and most of the smaller credit unions as well). We send a link either to your mobile or email address, you “login” and your bank statements are securely sent to us within roughly 90 seconds.
- E-Sign – When you have requested to complete your Loan Disclosure Documentation online (digitally). All parties to the loan must have email and web access to select this option, preferably along with smart phone or web camera access (Contact us for any issues). You can then receive your loan documentation via email link to sign up online through our provider, Secured Signing in a process that can take as little as 5 minutes without having to come into a branch.
- Equifax Limited – Equifax is a leading provider of credit information and analysis in Australia and New Zealand, and we use Equifax to assist us in making good lending decisions in regards to both individuals and business clients alike.
- External Lender – Where Real Finance cannot approve your loan internally due to our standard lending criteria, we may still be able to help. We use external, third party lenders in many cases, to ensure that you are able to get the approvals you are looking for.
- Guarantor – A person who guarantees to pay for someone else’s debt if they default on their loan obligations. A guarantor acts as a co-signer of sorts, in that they pledge their own Collateral or ability to meet repayment obligations if a situation arises in which the original debtor cannot perform their obligations.
- Maturity Date – The date which the loan is expected to end on. If you still have a remaining balance after this date, it will be all due for repayment.
- Personal Properties Securities Register – The Personal Property Security Register (PPSR) is the NZ Governments register where details of all New Zealand security interests in personal property can be registered and searched.
- Positive Credit Reporting – Previously New Zealand had a negative reporting system. This meant consumer credit reports could only contain information such as credit inquiries (typically applications for credit e.g. a personal loan or credit card) or the fact a particular credit provider or collection agency had loaded a credit payment default. Under the new CCR system positive data is able to be included on credit reports and provided to eligible groups – this provides a more balanced view of an individual’s credit status. The positive data that can be included on credit reports includes account information such as the date an account was opened and closed, credit limit, type of credit account, as well as 24 months credit repayment history.
Contact Us
Our specialist team is here to explain what we do and how we do it, learn about your needs and requirements and then get stuck into finding the best solution to your individual situation as quickly as possible.
Our services are highly tailored and we often have to ask personal questions to fully understand your situation and finances. We treat you and your private information with respect, fairness and integrity at all times.