If you are obtaining a loan or providing a guarantee for another party, your lender will often require you to obtain a Solicitor’s Certificate. This certificate confirms that you have received independent legal advice and that you understand the nature of the transaction, as well as the risks and potential liabilities arising from the loan and any associated security documents.
Why is it required?
By requiring a borrower or guarantor to obtain independent legal advice, lenders seek to minimise the risk of any future disputes arising on the basis that the relevant party did not understand the documents they were signing or the obligations they were undertaking.
While lenders or brokers may sometimes suggest that the documentation is straightforward or that the process simply involves a solicitor “signing off,” this is not the case. A Solicitor’s Certificate can only be provided after a thorough and independent review of the documents and a proper explanation of their effect.
What is the process?
Before issuing a Solicitor’s Certificate, your solicitor will carefully review the loan and security documents. Although these documents often follow a similar structure, their terms can vary significantly depending on the lender and the nature of the security being provided for the loan.
Following this review, your solicitor will arrange a meeting with you to explain the documents in detail. This includes outlining your obligations, highlighting any key risks, and ensuring you have a clear understanding of the potential consequences.
At Johnstone & Reimer, we take a practical, client-focused approach to Solicitor’s Certificates. Our aim is not only to satisfy the lender’s requirements, but to ensure that you are fully informed and confident in your decision. We also understand that these matters are often time-sensitive so we focus on working efficiently with lenders and brokers to meet your required deadlines.
If you have any questions regarding Solicitor’s Certificates or would like to arrange an appointment, please contact our team on (03) 8658 0040.
