AU2016101945A4

AU2016101945A4 - DIY Flexible loans

Info

Publication number: AU2016101945A4
Application number: AU2016101945A
Authority: AU
Inventors: Philip Hopper
Original assignee: Credi Pty Ltd
Current assignee: Credi Pty Ltd
Priority date: 2016-11-06
Filing date: 2016-11-06
Publication date: 2016-12-01
Anticipated expiration: 2024-11-06

Abstract

Abstract A process to create and initiate borrower designed loans Invention 1. A lender provides a platform whereby a borrower can go online and register. During registration the borrower can provide personal details and any financial information required. 2. Once registered the borrower can construct their own loan using various parameters. This could be, but not limited to: a. An amount of money b. An interest rate c. A duration (term) d. Setting the frequency of the repayments period e. Setting what day/date repayment starts/occur f. A repayment amount per time period g. Setting an interest only period h. Enabling a balloon payment at the end i. Changing the size and timing of the loan's repayments j. Designate an asset as security to lodged with the PPSR 3. The platform would allow the borrower to lock some of these parameters - for example the amount of money is fixed as is the repayment per period. 4. The platform would then "price" the loan by adjusting the unlocked values to provide a loan that the lender can provide eg it may extend the loan term or increase the interest rate. 5. The platform would display a full amortisation schedule (ie a schedule of payments). 6. The borrower may then look to adjust the timing and size of the schedule. This would recalculate any repayment or most likely term to accommodate the changes. 7. Once agreed with the borrower the platform would send the borrower designed loan for underwriting and confirmation of acceptance by the lender. 8. Once approved by the lender the borrower can provide any additional information required and a loan contract can be generated. 9. The loan can then be settled and normal loan collections commence.

Description

2016101945 06 Nov 2016 15 20 25

Background and Need

The value to financial institutions of small loans is limited with the time taken to process and assess a small loan often taking almost the same amount of time to 5 process a home loan.

To accommodate this financial institutions limit the flexibility around personal loans. This can often increase the risk of non-repayment as the loans are a “one size” fits all. 10

There are also strong regulations that loans are provided on the basis that they are fit for purpose and fit responsible lending ie the loan is able to be paid back by the borrower and it doesn’t place the borrower under hardship. A way to facilitate this is to allow the borrower to set the parameters around their own loan ie • How often do I get paid ? ie when can I make repayments? • How much can I afford to pay? Ie size of repayments? • Are their variations around what I can afford ? eg if I get paid weekly do I pay my rent at the end of the month so I can only really make repayments 3 out of every 4 weeks • How much do I need? To be able to afford this does the loan term need to increase? • Do I require a balloon payment at the end? Eg I may get an annual bonus that I will look to payout the loan with • Can I provide an asset as security?

The cost of having a financial institution to spend time designing such loans for a borrower would out way any increase in business. Therefore it would be ideal for a 30 borrower to undertake all the work in designing the loan. They are in the best position to know what they can afford and when and how they are best placed to make repayment.

Description of the Invention 35 The platform as described as part of the invention assumes that it is provided via a cloud based platform. This could be provided by other channels and the invention is not limited to online (web based) or smart phone (tablet) channels. For ease of description the party providing the money, goods or services is listed as the Lender [this may not be a legally correct term] and the party who has received the money, 40 goods or services is listed as the Borrower. 1. A borrower can go online and register onto a platform provided by the Lender. 2. During registration the borrower can provide personal details and any financial information required. This would consist of data that might be required for 45 responsible lending or ascertaining credit worthiness: a. Income b. Assets 2016101945 06 Nov 2016 50 55 60 65 70 75 80 c. Existing debts d. Proof of identity e. Etc 3. Personal detail may not be required to proceed - and may be left until a later stage. 4. Once registered the borrower can construct their own loan using various parameters. This could be, but not limited to: a. An amount of money b. An interest rate c. A duration (term) d. Setting the frequency of the repayments period e. Setting what day/date repayment starts/occur f. A repayment amount per time period g. Setting an interest only period h. Enabling a balloon payment at the end i. Changing the size and timing of the loan’s repayments

j. Designate an asset as security to lodged with the PPSR 5. The platform would allow the borrower to lock some of these parameters - for example the amount of money is fixed as is the repayment per period. 6. The platform would then “price” the loan by adjusting the unlocked values to provide a loan that the lender can provide eg it may extend the loan term or increase the interest rate. 7. The platform would display a full amortisation schedule (ie a schedule of payments). 8. The borrower may then look to adjust the timing and size of the schedule. This would recalculate any repayment or most likely term to accommodate the changes. 9. Once agreed with the borrower the platform would send the borrower designed loan for underwriting and confirmation of acceptance by the lender. 10. Once approved by the lender the borrower can provide any additional information required and a loan contract can be generated. 11. The loan can then be settled and normal loan collections commence.

All personal information held will be in accordance with privacy legislation.

Claims

Key Claims of the Invention

1. The provision of a platform or service to allow a borrower to enter or design a loan. The borrower can lock in various terms of the loan and the platform will calculate the other unlocked terms.
2. The borrower has the flexibility to be able to adjust repayment schedules to match their specific circumstances.
3. The borrower does the designing of the loan terms and the lender then accepts these terms based on any pricing adjustments.