Solicitor's Certificate of Independent Legal Advice

A Solicitor’s Certificate of Independent legal advice is issued by practicing lawyers ensure that the parties involved in a loan transaction: the borrower, lender and guarantor are aware and agree with the terms and conditions of the contract. 

It essentially turns the risk of the loan over to the borrower. Such a legal acknowledgement is increasingly being demanded by commercial banks and other non-traditional money lenders. 

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Following commercial banks, private and other non-traditional money lenders have been increasingly insisting on borrowers obtain a ‘Solicitor’s Certificate’ orIndependent Legal Advice Certificate‘ as a requisite to get their loans sanctioned. This certificate better secures their loan amounts and gives the lender a liberty to enforce legal recollection in case of a default. It is particularly demanded if there is a deed of guarantee required for the loan. In these circumstances, a Solicitor’s Certificate is required to shift the risk of the loan over to the customer.

The basic format of a Solicitor’s Certificate of Independent legal advice in Victoria can vary from bank to bank and other financial lending institutions.

A Solicitor's Certificate of Independent Legal Advice Ensures:


The party obtaining the loan completely comprehends and agrees to the terms and conditions of the loan agreement. That the borrower and guarantor, both are are aware of the security that is being offered for the loan. Also, all parties have received and understand other relevant documents.


If there's a default filed under the loan, the lender can seize and sell up the property/assets that the guarantor had offered as security against the loan. The lender has the liberty to recover the unpaid dues and default interest besides costs incurred in enforcing legal measures.

Solicitor's Certificate of Independent Legal Advice Melbourne


That the debtors is aware of the amount of repayments the loan agreement will require them to pay. That they have the income to service these repayments, and that they have obtained appropriate advice from their accountant and/or financial advisers and/or lawyers.


If there is a deed of guarantee, the guarantor acknowledges that if there is a default on the loan, whatever security the guarantor had provided under their guarantee may be sold by the lender to recoup the amount owing under the loan with default interest and other costs that they incur in the process.

How we can help with a Solicitor’s Certificate in Melbourne?

If a Solicitor’s Certificate is not carefully issued, all the parties involved in the loan transaction face the risk of being involved in lengthy and expensive litigation where no one benefits- the lender, borrower, guarantor and advisers.

Our professional indemnity insurers for lawyers are very strict in relation to our requirements for solicitors providing these certificates. 


Most frequent questions and answers

Loan and guarantee documents are often involved with hidden small print that can catch you or the borrower (whose actions you are guaranteeing) out. That is why a solicitor’s certificate is essential.

A Deed of Guarantee (DoG) is a legal document which states that if a person or company “1” agrees to be responsible for person “2”  ‘s commercial rent if person “2” is unable to pay it.

Generally, a guarantor can only act on behalf of one loan at a time. This is certainly worth thinking about if you have two or more children that may require your help in the future. As soon as the loan is paid, the individual is able to act as a guarantor again.

If the debtor defaults on loan, the debt becomes the Guarantor’s responsibility. And if the Guarantor dies during the term of guarantee, the obligations do not die. A guarantor may have to sell their property to clear the debt.

The eligibility requirement to be a guarantor should be at least 18 years of age. They must have a property in Australia, particularly for home loan banks won’t accept property located overseas. They need to be a New Zealand or Australian citizen.

A guarantor is a person who gives “guarantee” for someones else loan or mortgage by promising to repay the debt if they can’t afford to. The documents required to provide by the guarantor during the loan process are two bank statements, two pay stubs, one or two tax returns, and a letter stating the income if owning the business.

Up until recently, only Commercial Banks and NBFI’s used to ask for a solicitor’s certificate from the loan-seeking party. But, to better secure their money, even private money lenders require a certificate of independent legal advice as of late.

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