The lender who finds the loan does not decide whether we fund it
Origination stays with the specialist who knows the market. The credit decision sits with Auremont, and it is the same decision every time.
First mortgage secured Australian commercial real estate
The programme lends against Australian real estate, secured by a registered first mortgage in every case. It does not take second mortgages, and it does not take unsecured exposure.
Loans are originated by Approved Financiers across the country and assessed centrally by the Manager. The asset types, the security position and the lending parameters are set out in the Investment Policy and in the Information Memorandum.
Three stages, one standard
A loan passes through three hands before it is funded, and each of the three does only its own part.
The Approved Financier does what it is good at, which is finding and assessing the borrower and the asset in its own market. The Manager does the part that has to be consistent across the whole programme, which is deciding whether the loan meets the standard. The Appointed Trustee does the part that must sit with a licensed party holding the money and the title.
Reach without a balance sheet
No single specialist lender can offer national coverage, every asset type and a consistent credit standard at the same time. Aggregating them does.
Each Approved Financier originates in the market it knows. The programme takes the reach of all of them and applies one standard across the whole of it, so that a loan written in regional Queensland is tested the same way as one written in inner Melbourne.
The Manager does not lend as principal and does not hold a balance sheet against the loans. It directs investment, and the capital comes from Wholesale Investors through the Trust.
One trust for every loan
Each loan is held in its own Single Asset Trust, and nothing crosses between them.
The practical consequence is that a problem is bounded on the day it arises. There is no shared security pool to unwind, no cross-collateralisation to negotiate, and no other borrower's position to consider while one loan is being worked out.
Diversification across separate trusts, asset types, states and Approved Financiers reduces concentration. It does not remove market risk, and it does not remove the risk that several loans are affected by the same conditions at the same time.