RSM Law Ltd has a long and proud history of mortgage lending through our Mortgage Nominee Company. Our present mortgage portfolio is substantial. We have been lending money for rural, residential and commercial projects for over 100 years.

All lending through the Nominee Company is very strictly in accordance with The Lawyers and Conveyancors Act (Lawyers: Nominee Company) Rules 2008 and our lending procedures are audited by Auditors appointed by the New Zealand Law Society. Under these rules, we are able to lend up to a maximum of 66.66% of valuation of the property. All lending must be approved by a review committee which meets weekly to consider applications. The review committee is made up from at least three Directors and two Senior staff.

Nominee Company lending is by way of first mortgages over residential, rural and commercial properties and occasionally lending is approved to applicants from outside the South Canterbury region.

Investor funds are at all times separately identifiable within the mortgage investment and investors can at any time request a full schedule of their investments with all relevant information. At the time of investment of funds in a mortgage, the investor is given full details of the mortgage security and of the borrower (mortgagor) with a copy of the valuation of the property made available.

Mortgages are for a maximum term of 3 years on a “flat” mortgage basis, ie the mortgagor normally pays interest only on the funds throughout the term. On expiry of the term our Nominee Company may agree to renew the mortgage for a further term of 3 years provided the renewed mortgage still falls within valuation guidelines. At the time of renewal of a mortgage the investor will be asked whether or not they wish to reinvest their funds in the mortgage.

the investor wishes to withdraw the investment during the 3 year term, this can usually be arranged but the investor may be called upon to pay fees (including revaluation fees) in respect of the replacement of the investors funds in the mortgage by another investor’s funds. Funds can only be released from mortgages when the mortgage is repaid or the funds are replaced.

Investments through our Nominee Company attract a rate of return, usually 1% or 1.5% above other available fixed investment opportunities. Our Nominee Company charges an administration and collection fee of 9.1% of the gross amount of interest collected. Resident Withholding Tax is deducted at source and forwarded directly to the Inland Revenue Department. At the 31st of March each year a Tax Certificate is forwarded to the investor for taxation purposes. Net interest after deduction of commission and Resident Withholding Tax is paid out to the investor on a regular quarterly basis in February, May, August and November in each year.

For income tax return purposes the administration and collection fee is a proper claim as a deductible expense incurred in generating the interest income.

During the term of the mortgage our Nominee Company has the right to review the rate of interest to allow for market rate fluctuations either up or down. Accordingly the interest return on the investment may fluctuate.

Disclosure Statement

As Required by Part IV of the Securities Markets Amendment Act 2006 and The Financial Advisors Act 2008 and The Financial Service Providers (Registration and Dispute Resolution) Act 2008

Procedures relating to the receipt and distribution of funds are as follows:

  1. RSM Law Limited operates a trust account. All funds received on your behalf will be held to your credit, in that trust account. Payments out of this trust account will be made only to you, or to others on your authority. A written authority may be required where payment is made to another person. For investment clients, payments will be either made by direct credit to your bank account or held on call deposit.
  2. A full record of the RSM Law Limited trust account is kept and a statement of trust account transactions (which details funds received on your behalf and payments made) will be provided at any time, upon request but in any event annually.
  3. Payments made to RSM Law Limited can either be by way of cash, cheque made payable to RSM LAW, or direct credited to the trust account. If moneys are being direct credited to this account it is essential that you inform us preferably in writing or by facsimile at that time as to whose credit the moneys are being paid and for what purpose.
  4. Where appropriate, funds will be placed on call deposit with a trading bank registered in terms on Section 69 of the Reserve Bank of New Zealand Act 1989. Funds can also be placed on term deposit (which generally attracts a higher rate of interest). Your authority will be required for a term of 15 days or more.
  5. Interest earned less PAYE or Resident Withholding Tax will be credited to your account. RSM will deduct an administration fee equal to 10% of the gross interest earned for trust account deposits and 9.1% for investments in our Lawyers Nominee Company.
  6. Operation of the Trust account is governed by The Lawyers and Conveyancors Act (Trust Account) Regulations 2008.
  7. Investment Advisors/Brokers
    In terms of the above Acts, the names of possible Investment advisors and Investment Brokers required to be disclosed are as follows:
    These people are all suitably experienced in investing and managing funds. The solicitors each have a law degree and are members of the NZ Law Society, and the partners monitor and oversee all investments within the firm. The firm holds professional indemnity insurance providing cover that meets or exceeds the minimum standards specified by the N.Z.L.S.

RSM Law Limited is a registered Financial Service Provider - FSP41521

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