Target Market Determination

PayOnSuccess Loan

This document is the Target Market Determination (TMD) for the Real Flow Finance PayOnSuccess Loan 

A Target Market Determination (TMD) is a written document that: 

  • describes the class of customers that 
  • make up the target market for the Real Flow Finance PayOnSuccess Loan (Target Market);
  • specifies any conditions and restrictions on the distribution of the product (Distribution Conditions); and
  • sets out the events or circumstances where we are required to review the TMD (Review Triggers).   

We are required to have a TMD by law.  This TMD is not a recommendation to acquire a Real Flow Finance PayOnSuccess Loan nor does it replace our terms and conditions or other disclosure documents that we or one of our third party distributors (Distributors) may provide to you.  

Product Type Bridging Loan
Issued By (Real Flow Finance, we, us, our) Real Estate Advance Pty Ltd ACN 164 355 051 Australian Credit Licence 546099
Date TMD approved 1 August 2023
TMD Version 2.0
Initial Review Period  One year after the date of this TMD
Subsequent Review Periods Every third anniversary of the date of this TMD

Target Market Description

Product description and key attributes

The PayOnSuccess Loan is a bridging loan designed for vendors who wish to finance the marketing and advertising costs associated with the sale of a residential property or to pay for the expenses related to the styling of a residential property in preparation for sale.  

The key attribute of the Real Flow Finance PayOnSuccess is that the loan is a ‘limited recourse loan’.  This means that, provided the borrower complies with all of their obligations under the loan (including all ‘special conditions’) the borrower will not be required to repay the loan (ever) if they do not sell their property after 12 months of active marketing.  

However, borrowers must be aware that the ‘limited recourse protection’ will not apply if:

  • the property is sold; 
  • the borrower is in default under the credit contract (for example, the borrower is a flipper or developer or the borrower fails to actively market the property at all times during the Loan Term); 
  • the borrower had exchanged contracts with a purchaser before the property was listed on a major property sale platform (such as domain.com.au or realestaste.com.au); or 
  • a Risk Protection Exclusion Event occurs during the Loan Term. 

Risk Protection Exclusion Events include situations where the property is destroyed by fire of flood during the Loan Term, and situations in which a pandemic prevents or causes a delay to the sale of the Property).  

Other attributes of the PayOnSuccess Loan include the following.  

  • Loan Term – unless the ‘limited recourse protections’ apply, the PayOnSuccess Loan must be repaid on the earlier of:
    • the sale of the property; or
    • 12 months after the date of the credit contract 
  • Minimum Loan Amount – $1,000.00
  • Maximum Loan Amount – $20,000.00, subject to credit approval.  
  • Interest Rate –fixed for the term of the loan.  
  • Repayments – interest is capitalised over the Loan Term (therefore, repayments are not required during the Loan Term);
  • Early Repayments – at any time without penalty; 
  • Security – caveat over the property being sold.    
  • Maximum Loan to Value Ratio (LVR) – 95%

Fees and charges also apply.  
Customers for whom the product is likely to be suitable (Target Market)

Real Flow Finance considers that the Real Flow Finance PayOnSuccess Loan will suit borrowers who want a loan to finance the upfront costs associated with marketing and advertising a property for sale, but: 

  • who want the flexibility of interest capitalisation so that they are not required to make repayments during the expected period of the marketing campaign; and
  • are concerned that they may face a relatively long marketing campaign or may not manage to sell the property at all, even after actively marketing the property for twelve months.    

Customers within the Target Market must be able to repay the PayOnSuccess Loan in full out of the proceeds of sale of the property.  

Customers within the Target Market will:

  • be 18 years or over; and
  • be an Australian citizen or resident;
  • be able to repay the loan out of the expected proceeds from the sale of the property, but are concerned that it may take some time to sell the property even with active marketing;
  • be able to meet Real Flow Finance’s credit criteria;
  • want to capitalise the interest for the term of the loan; and
  • be willing to grant Real Flow Finance a caveat over the property.
Ineligible consumers

The Real Flow Finance PayOnSuccess Loan is not appropriate for customers who:

  • are under 18 years old;
  • do not meet Real Flow Finance’s credit criteria;
  • are a flipper or developer;
  • are selling a property that: 
    • is not a residential property or is not a single dwelling;
    • is rural land, farmland, vacant land or land under construction 
    • is being sold for redevelopment purposes;
    • is a display suite; or
    • suffers from material defects which may affect the scalability of the property;
  • Would be unable to repay the loan in full upon the sale of the property; or
  • have defined goals and objectives that are not met by this product.

Real Flow Finance considers that the product, including its key attributes, is likely to be consistent with the likely objectives, financial situation and needs of consumers in the Target Market because:

  • applicants will only be approved for the purposes set out above; and
  • applications will only be approved if the customer meets Real Flow Finance’s credit assessment criteria.  

Distribution Conditions

Conditions and restrictions on distribution of the product

The Real Flow Finance PayOnSuccess Loan is subject to the following distribution conditions and restrictions: 

The Real Flow Finance PayOnSuccess Loan may only be distributed:

  • via an on-line application;
  • by the customer calling Real Flow Finance directly; 
  • through a broker acting under an Australian Credit Licence; or
  • as a result of a referral from one of our Referrers, acting in accordance with the ‘Referrer exemptions’ in Regulation 25(2) or 25(5) of the NCCP Regulations.  

Real Flow Finance considers that its Distribution Conditions are appropriate and likely to result in the product being distributed to the Target Market for the following reasons.  

  • Legal relationship – Real Flow Finance has: 
  • a direct employment relationship with our staff taking calls or otherwise assisting customers who are interested in a Real Flow Finance PayOnSuccess Loan; and
  • a written agreement with our third party Distributors.  
  • Supervision – Real Flow Finance 
    • closely monitors the performance of its staff; and 
    • undertakes periodic reviews in relation to the activities of our third party Distributors.
  • Training – 
  • Staff and licensed third party brokers: 
    • are appropriately trained to discuss the features of the product with customers; and
    • understand that applications will not be approved unless they satisfy Real Flow Finance’s credit assessment criteria; and
  • Referrers are provided with clear instructions regarding the limitations on their activities.  

Review Triggers

Circumstances which will result in the product being reviewed

Real Flow Finance will review this TMD in the following circumstances.  

  • we receive a significant number of complaints in relation to the product 
  • we identify a material adverse customer experience in relation to product appropriateness 
  • there is a material change to the product’s key attributes or the manner of distribution 
  • there is a pattern of ‘significant dealings’ in the product which are inconsistent with the Target Market; 
  • ASIC orders that the distribution of the product cease, or ASIC or AFCA raise concerns about the design and distribution of the product; and
  • any other event or circumstance that Real Flow Finance considers mean that it is appropriate for the TMD to be reviewed.  

Review Trigger Reporting Requirements 

Our staff and third party Distributors must advise Real Flow Finance if they become aware of any of the following matters within the timeframes specified.  

Product complaint data

Information relating to complaints received about the product or the distribution of the product, including: 

  • number of complaints, 
  • the identifier of the distributor;
  • the product name; and
  • the exact details of the complaint.  
 Immediately, but in any case, no later than next business day after becoming aware of the complaint.
Significant dealings Any significant dealing of the product outside the Target Market As soon as practicable but no later than 10 business days after becoming aware of the significant dealing.
Feedback Any feedback received about the product or the Distribution Conditions for the product.   As soon as possible, but no later than within 20 business days of the receiving the feedback

Record Keeping

Real Flow Finance will keep records of the reasonable steps they have taken to ensure that this product is sold in a manner consistent with this TMD.  Our third party Distributors must also keep records of all customers they refer to us.  

Real Flow Finance will also keep complete and accurate records of 

  • all versions of the TMD for this product; and
  • our decisions, and the reasons for those decisions about:
    • the determination of the TMD for this product;
    • the identification and tracking of review triggers; 
    • the setting of review periods, and 
    • all other the matters documented in this TMD.