Sample Finance Paper on A Mortgage Broker

Question and answers

1.What roles or tasks does a mortgage broker perform

A mortgage broker offers financial advice to home buyers and homeowners giving them financial options for real estate purchase. A mortgage broker provides information to homeowners by assisting them to find the loan that suits their needs. They also negotiate with the lenders to secure loans on behalf of the homeowner. In addition, the mortgage broker oversees the signing of the loan documents as a witness (Aalbers, 2016).

2.What are the requirements of a mortgage broker

Mortgage broker needs to have acquired high school education and the college degree, the most important qualification to be a mortgage broker is a license.  Although each state has different regulations to obtain a license one needs to have proper professional experience and training. One needs to pass  a written test and meet the standard requirements of being a broker.

3.How can you build trust  with a new client

Mortgage brokers can build trust by ensuring that clients receive all the attention by answering their questions or find someone to provide them with additional information they would require. Timely, clear a short response will make clients believe that the broker is a useful resource that he can refer someone or return for more advice.  Building trust is about making the best decision regarding mortgage sale and loaning (Aalbers, 2016).

  1. What information should you provide about your organization when you first meet a client?

The first time you meet the client, it is important to present an overview of the organization what the company does and the available offers.  Other information includes the company background and the main services the company offers. It is important to share the company experience to ensure that clients feel that they are seeking advice from a knowledgeable and reputable company (Ambrose & Conklin, 2014).

5.What are the benefits of ADR procedure

The alternative dispute resolution process has numerous benefits for both parties involved in the dispute process because they have the opportunity to work through dispute and finally agree on common ground through the third party (Singer, 2018). This process is faster and less expensive compared to the court process.  Given the fact that most people cannot afford to pay for certain legal feel they can still access the dispute resolution process to solve their problem (Singer, 2018).

6.What information needs to be disclosed by the client

A client needs to disclose all the relevant information during meditation, which is bound by confidentiality .The client, needs to discuss merits of his respective position and how it relates to the dispute .In addition, the client needs to present factual information that resulted to the dispute depending on the nature of the dispute (Bargman, 2014).

  1. What is the client’s financial position determined by

A clients’ financial position is determined by the client’s incomes which should be adequate to meet his investment needs. Income attempt alone is not adequate to state a client’s financial position other documents like the balance sheet which indicates the client’s assets, liabilities, and net worth also determines his financial position (Bargman, 2014).

  1. What information would you use to clarify your client’s investment goals and expectations

As an advisor, I would explain the value position, the investment process and how to get paid. It’s important to sign an investment policy statement to set parameters this will help in measuring performance . A clients engagement letter is an important document with expected standard of practice the can help to ensure that everything decision is based on what the client wants (Johnson & Peterson, 2014).

9.Researching available services may  include

Being a financial advisor entails laying out the situation to come  up with a plan that entails doing real projection by searching for additional information and investigating available alternatives that can help clients make a good financial decision. Researching means analyzing outside the area of expertise or other better offering. (Johnson & Peterson, 2014).

10.Where might you seek specialist advice from

One can seek for specialist advice from a licensed financial advisor or professional advice from a business advisor to help in investing to minimize any financial problems. A good financial advisor needs to have the expertise to explain both the risk and benefits of investment

11.What do you need to consider when making a referral for specialist advice

When referring for specialist advice, it’s essential to act in the best interest of the clients. When one realizes that the client’s request does to fit what is available, it’s essential to inform the clients of all the available options and also propose to him a good advisor in the specific area that can help the clients (Krewson-Kelly & Thomas, 2016).

12.What do you need to do  in order to prepare  documentation  and follow-up

To prepare documentation and follow up, it’s important to adopt procedures for documentation one need to use a checklist to ensure that the successful implement takes place before the completion process (Muheki et al, 2015). Using a requirement list can help answer a question during the validation process to capture those questions that might be forgotten during the follow-up process (Muheki et al, 2015).

  1. What is essential when creating records for a client

When creating records for a client, it is essential to have an accurate and appropriate record kept; record keeping is important in many professions because of offering accountable services. Creating records for a client means providing the client with accurate and up to date records that can assist later in making referrals for other services

(Krewson-Kelly & Thomas, 2016).

  1. 14. What is essential when updating client records?

Updating clients records encourage comprehensive record and reduce unnecessary documentation, updating records saves time and facilitate easy retrieval of information from the records. Modification of records required to present correct information that needs to be stored and maintained a clearly labeled to facilitate easy referencing (Krewson-Kelly & Thomas, 2016).

Part 2

1.Financial, accounting terms and concepts

  1. a. Variable and fixed rates interest rates

Variable interest is the interest rate for a loan whereby the rate will be charged on the outstanding loan balances which varies depending on the market interest rate changes. Fixed interests are interest rates are charges whereby interest rates for the loan are fixed for the whole period no matter the market interest rates (Ambrose & Conklin, 2014).

b.Types of mortgage account

The two types of mortgage account are fixed rates whereby charges stay the same for years and variable rate where interest rates changes with time (Ambrose & Conklin, 2014).

c.Procedure and principles of deposit bond

A deposit bond acts as a guarantee whereby the purchaser can use to pay for the deposit at settlement. Long-term deposit bonds last up to 4 years, which can be used to pay for properties off the plan. When buying property, one is required to provide cash deposit of 10 percent of the purchase price. The deposit bond can use as a guarantee for the contract sale (Ambrose & Conklin, 2014).

  1. Financial record relating to different ownership models

The consolidated method is a type of investment accounting the used for consolidating the financial statement of majority ownership investment. These methods are used, and an effective method to control  subsidiary  which is assumed to be 50.0percent  of the subsidiary shares  .By consolidating  subsidiary balances  means combining  financial statement  of the subsidiary with  parent company balance (Aalbers,2016).

2.Key features of complaint handling and resolution process and the roles of alternative dispute resolution schemes and services

Critical features of complaint handling and resolution process includes neutral evaluation, neutral negotiation, conciliation, and mediation. However, arbitration and mediation negotiations are the first attempt to resolve disputes. Negotiation permits  parties meet and settle disputes. Alternative dispute result in schemes and services offering numerous advantages   because it allows parties to control the process and the solution (Block, 2017).

3.Explain the credit  and credit reporting services

The credit history is important to mortgage lenders, banks and other entities. Therefore, a credit report can determine your financial position. Credit reporting services act as an agency that maintains historical credit information of individuals and business. The agency received reports for lenders, and other sources compiled that includes a credit score (Bargman, 2014).

  1. Explain the key features of the economic environment and business cycle, financial markets and the role of industry participants, interest rates, exchange rate, and inflation

In any business environment, stable inflation is expected to eliminate macroeconomic instability. Therefore, stable inflation reduces inflation risk (Johnson & Peterson, 2014). Any small changes in annual growth rate over time can result in the difference in income levels affecting the living standard. Changes in economic policies and institutional reforms can improve the economic growth of a country. However, high inflation rates reduces tax credited hence the cost of investment increases if the money used to purchase capital goods will raise the inflate near. This decrease accumulation of physical capital which is a key driver of growth. Exchange rate affects the rates of inflation (Johnson & Peterson, 2014). For example, if the exchange rate appreciates the prices of imported goods reduces. Exchange rate appreciating slows the growth of GDP because of the fall in net export and the rise in demand for import. Fall in currency can be used as the expansive monetary policy to counter-cyclical measure to stimulate export demand ruing decision to bring improvement in balance trade (Johnson & Peterson, 2014).

  1. Identify and describe the key features of the legal environment and relevant legislation services in regards to
  2. Disclosure

Under the privacy act, specific rules and guidelines is about protection use and disclosure of information relating disclosure. The act provides that records should not be disclosed to any their party without written a written consent from the person (Caron et al, 2016).


Privacy act is an act that controls  how personal information is used and handled  the act states that information  should be kept confidential, whether its individual  signature, address, telephone numbers, date of birth, medical record, bank account detail  or commentary or opinion about the person (Caron et al, 2016).

c.An industry code of practice

An industry code of practice rules that regulate industry conduct. The code helps in improving industry standards by proving   flexible, low-cost forms of regulation (Caron et al, 2016).

d.National credit code

The national credit code outlines licensing of credit service providers and obligation regarding credit lending conducts .The credit can be offered for household purposes to purchase, improve residential priority for investment purposes (Caron et al, 2016).

  1. Describe the key features of lender mortgage insurance

One of the key features of lender mortgage insurance is that it is insurance given by  the  lender to help insure against the risk of not being able to recover the full loan balance if the borrower is unable to meet the loan payment. It’s important to understand that the lender mortgage insurance cover the lender not the guarantor (Aalbers, 2016).


  1. Explain the following definition
  2. Lender and borrower

The lender is an individual or a group the offer funds with an expectation that the funds will be repaid within an agreed period .The borrower is the person who receives money and expected to pay at with an interest (Aalbers, 2016).

b.Lessor and lessee

The lessor is the person who receives payment in exchange from using the property while lessee is the party who pays the lessor to use the property (Aalbers, 2016).

c.Mortgagor and mortgagee

Mortgagor I the lending institution that offers financial assistance for buyers while a mortgagee is a person who borrows money from the mortgagor for home purchase(Aalbers, 2016).

  1. a. Land title and searches

Land title is an official record proving the ownership of land while title search is a record issued by the land title office containing land title register within a specific period

(Ambrose & Conklin, 2014).

  1. Strata title versus company title

Strata title is a record that indicates the ownership of layers of airspace like a multi-story building .Company title is a scheme of land ownership whereby a company has a title to land (Ambrose & Conklin, 2014).

c.Multiple securities

Multiple securities is a payment method where one can settle using securities in the home market or remote market and cross-border transaction (Ambrose & Conklin, 2014).


d.Securing the second mortgage

Second mortgage loan is issued as collateral to purchase a home the loan is the first loan that is secured by a lien (Ambrose & Conklin, 2014).


e.Subdivision of title

Subdividing of title means diving land into pieces for development using a plat (Ambrose & Conklin, 2014).


f.Partial discharge of mortgage where multiple securities are held by partial lender discharge occurs when one has more than one property secured by a loan and would want to release those properties as security without pay the full loan. Partial discharge where there are multiple security held by lenders al the security properties will not be discharged on the same day (Bargman, 2014).

  1. Categorize and explain at least two types of fee and charges

The first type of fee is the upfront to set up fee, which is one off payment when you start paying the loan. Administration fee can be charged every month or year for administering loans.



Aalbers, M. B. (2016). The financialization of home and the mortgage market crisis. In The Financialization of Housing (pp. 40-63). Routledge.

Ambrose, B. W., & Conklin, J. N. (2014). Mortgage brokers, origination fees, price transparency and competition. Real Estate Economics, 42(2), 363-421.

Bargman, D. (2014). Think on the Downside: A few alternative measures of market risk that lead to safer and more profitable investment strategies. Saarbrücken: LAP LAMBERT Academic Publishing.

Block, M. J. (2017). The Benefits of Alternative Dispute Resolution for International Commercial and Intellectual Property Disputes. Rutgers L. Rec., 44, 1.

Caron, X., Bosua, R., Maynard, S. B., & Ahmad, A. (2016). The Internet of Things (IoT) and its impact on individual privacy: An Australian perspective. Computer law & security review, 32(1), 4-15.

Johnson, D., & Peterson, M. (2014). Consumer financial anxiety: US regional financial service firms’ trust building response to the financial crisis. International Journal of Bank Marketing, 32(6), 515-533.

Krewson-Kelly, S., & Thomas, R. B. (2016). The Intelligent REIT Investor: How to Build Wealth with Real Estate Investment Trusts. John Wiley & Sons.

Muheki, M., Lueg, K., Lueg, R., & Schmaltz, C. (2015). How business reporting changed during the financial crisis: a comparative case study of two large US banks.

Singer, L. (2018). Settling disputes: Conflict resolution in business, families, and the legal system. Routledge.