What are the terms of the Loan?
Each QuantumWarrant includes a limited recourse Loan (which
is limited to the Property) made to an Investor by Quantum.
Quantum has no right to seek repayment of the Loan, Interest
or other costs from the Investor other than by exercise
of the Mortgage over the Investment.
Finance will be arranged upon receipt of an Application.
An Application must be received 4 weeks prior to exchange
on the Property and 8 weeks prior to the completion date
of the contract of sale of a Property, unless prior arrangements
have been made by Quantum.
It is Quantum’s intention to arrange Finance with
a fixed interest rate for a period of at least 1 year, and
up to 10 years, if requested by the Applicant in their Application.
Quantum will endeavour to source Finance on these terms,
but does not guarantee it will be able to provide a Loan
with a fixed interest rate period for the full period requested.
Any Finance sourced with a fixed interest rate greater than 1 year may
have additional Finance costs payable by the Investor to
Quantum upon making a Completion Payment or part repayment
of the Loan.
Finance will not, for the purposes of a QuantumWarrant,
exceed 80% of the value of the Property.
The Loan term may vary depending upon what Loan term Quantum
is able to achieve from the Financier on the Property used
as security of a QuantumWarrant. The Loan term may be less
than the available 10 year period (to the Maturity Date).
The type of Loan and the interest rate will depend upon
the location, tenants and other variables in relation to
the Property. Upon vetting a potential property as a QuantumWarrant
for an Investor, Quantum will provide indicative Loan parameters
in its quote.
Prepayments of interest
Part of the First Amount will be applied towards the payment
of prepaid interest on the Loan. Investors should be allowed
a tax deduction for the prepaid interest when the prepayment
is made. Normally the pre payment will be for one year in
advance to the next Annual Reset Date unless otherwise agreed
by Quantum. Quantum may fix the interest rate for a period
of Finance greater than one year. This will be at the discretion
of the Investor otherwise all Loans will be fixed for one
year, interest payable in advance.
Quantum will charge a lump sum Borrowing Fee in respect
of Loans to Applicants. The Borrowing Fee will be imposed
at the time a Loan is made and is used to cover the fees
payable to the Financier, legal fees on the finance and
the management of arranging the finance in preparation of
the settlement of the Property. This fee will normally only
be paid at the start of a new Loan term. So if a loan term
is for 5 years the Borrowing Fee would again be payable
if the Investor elects to refinance the Loan rather than
make the Completion Payment.
Early Repayment Charges
The early repayment of the Loan may result in a Break
Quantum may provide a Loan for Investors up to 80% of
the value of the Property.
Quantum may source its Finance from a variety of Financiers,
including mortgage funding via Quantum Mortgage Trust a
registered mortgage trust with the ASIC –
ARSN: 095-909-096. For the purpose of securing repayment
of the Loan and the Interest, the Security Trustee will
provide Quantum or as Quantum directs a Mortgage over the
Property. The Security Deed allows the Security Trustee
to provide security over the Property on behalf of the Investor.
Quantum will act in this respect on behalf of each Investor
under a Power of Attorney.
In accordance with normal market practice, upon default.
Quantum’s recourse will be limited to the Property.
Repayment of the Loan
The Investor may repay part or all of the Loan at the Annual
If the Investor does not pay the Interest or the Completion
Payment at the Maturity Date, Quantum may exercise its rights
under the Loan Agreement to sell the Property. Interest
on the loan will be payable until the property is sold.
The interest rate will be the one year interest rate applicable
at Annual Reset Date.