Variable Home Loan INV Target Market Determination

Variable Home Loan - Investment (Investment Fixed Rate Home Loans will revert to this product at the end of the fixed term)

Effective date: 22/04/2024
Product: 802

Key product attributes

• Interest rate type: Variable rate.
• Minimum loan amount: $20,000.00
• Maximum loan amount: $5,000,000.00
• Loan term: 30 years - Inclusice of initial fixed rate loan term.
• Fees payable: There are no Bank fees payable for the rollover of the Fixed Interest Rate Home Loan to this Variable Rate Home Loan. Details of other possible fees and charges that may be applicable during the course of the loan are available upon enquiry.
• Fees not payable: Monthly fee, early repayment fee or redraw fee.
• Repayment type: Principal and interest.
• Repayment frequency: Weekly, fortnightly or monthly
• Features: Redraw and 100% offset.
• Security: Required - property used for predominately residential investment purposes.
• LVR: Up to 90% LVR (Lenders Mortgage Insurance required where LVR is >80%)

Target market

Members Investment Fixed Rate Home Loans will automatically convert to this Variable Rate Home Loan upon expiry of the fixed interest rate term.

This product is designed for members who:

• Have a Fixed Rate Home Loan. On maturity of the initial fixed rate term the loan will automatically revert to this variable product.
• Wish to continue to finance the purchase of existing investment residential property.
• The ability to make additional repayment or to repay their loan eatly without additional charges or penalties.

This product is not suitable for members who:

• Do not have a previous Investment Fixed Rate Home Loan.
• Require the certainty of knowing what their repayments will be.

Likely objectives, needs and financial situation

• Members seeking to achieve ownership of a property for Investment purposes.
• Require to move to a variable rate home loan (and associated features) to help finance their objective.
• Previously purchased a residential investment property with a Fixed Interest Rate Home Loan term which has expired.

Distribution of this product

This product is designed to be distributed by:

• Automatic rollover of a previously Fixed Rate Investment home loan.
• This product is not for individual sale. 

This product will only be distributed by the appropriately trained and authorised P&N Bank representatives. These representatives will apply distribution conditions which include ensuring that customers fall within the TMD, meet the eligibility and servicing requirements for the loan and that the product is not unsuitable for their needs.

Distribution obligation

The following information must be provided to P&N Bank (Police & Nurses Limited) by distributors who engage in retail product distribution conduct in relation to this product:

Accredited P&N Bank staff who are required to:

• follow an approved conversation framework and direct members towards the most suitable product to meet their objectives, needs and financial requirements.
• understand and be able to discuss the features, benefits, rates, and any applicable fees associated with the selected product and the key differences between lending products.
• provide details of any request for this product that may be inconsistent with this TMD. Police & Nurses Limited, Products department must be notified as soon as practical and within 10 business days of staff becoming aware of any inconsistencies in the sale of this product with this TMD. Failure to provide details of dealings considered inconsistent with this TMD may lead to this product being removed from sale.

Applications and discussions are monitored through controls such as sample call monitoring and application reviews to identify errors and ensure compliance with P&N Bank’s distribution processes. 

Online Channels (P&N Bank website; rate and comparison websites)

• the P&N Bank website provides members with information and tools about this product, including the interest rates, any applicable fees or charges, and repayment calculators as well as a summary of the key features and benefits of the product.
• enquiries lodged via the P&N Bank website may be directed to accredited P&N Bank staff.
• Rate and comparison websites provide members with an overview of rates and products available. Members may select a series of click through links that will direct them to P&N Bank’s website where they can request a call from one of our accredited staff. 

Accredited aggregators and brokers

If P&N Bank permits this product to be distributed through approved aggregators and their authorised brokers, who have been fully approved by P&N Bank, P&N Bank also requires that aggregators responsible for third party brokers involved in the distribution of this product:

• comply with the agreement in place with P&N Bank and must ensure compliance by their authorised brokers with:
• P&N Bank mortgage broking requirements; and
• their legal obligation to act in the best interest of their client when providing assistance.
• provide information relating to complaints, including the number of complaints, third party name and verbatim details of the complaint and their significance, on a quarterly basis in a format acceptable to P&N Bank.
• report any significant dealings with this product that may be considered inconsistent with this TMD. P&N Bank must be notified as soon as practical and within 10 business days of becoming aware of any inconsistencies. Failure to provide details of dealings considered inconsistent with this TMD may lead to this product being withdrawn from sale by P&N Bank.
• provide any other information reasonably requested by the issuer.

Distribution appropriateness

These distribution conditions are designed to ensure that all channels capture and record the members objectives, needs and financial situation through the sales process and lead to the recommendation of this product as the most suitable for members according to the key attributes of the product listed and described in this determination.

These obligations are also considered appropriate as the target market is wide and the issuer has distributed this product using these methods, with limited risk to members.

Reviewing this document

This TMD will be reviewed within 1 year from the effective date and 1 year after the initial review and each subsequent review to ensure it remains appropriate.

We will also review this document should any review triggers occur that would reasonably suggest that the TMD is no longer appropriate. The occurrence of any one of the following trigger events will result in an immediate review of this TMD:

• a dealing of the product to members, made through any distribution channel, that is not consistent with this target market determination occurs and results in a significant material impact to a member or material impact to numerous members.
• material changes to the product or the terms and conditions of the product occurs which would cause the TMD to no longer be appropriate.
• material changes to the regulatory environment.

A quarterly review will be conducted of the following trigger events to determine if the account performance, usage, or complaint information indicates that a review of this TMD Is required.

These triggers include:

• a material and/or unexpected increase in the volume, nature and/or significance of complaints is received in any quarter from members in relation to their purchase or use of the product that reasonably suggests that the TMD is no longer appropriate.
• changes to the overall product performance, as determined by the issuer, that suggests that the product is no longer appropriate to the target market, including but not limited to an unexpected change in the sales volumes in any or all of the distribution channels, a material change in the volumes of product closures and/or product switches or an unexpected increase in associated fee income.
• feedback received from any of the distribution channels for this product.