Tuesday, 04 September, 2007: Consumer groups and financial industry bodies have formed a new coalition to discuss mounting concerns about predatory lending.
The coalition, which includes the Australian Bankers’ Association, Abacus – Australian Mutuals, Mortgage and Finance Association of Australia, consumer groups, Legal Aid, law firms and the Public Interest Law Clearing House, met for the first time on 27th August 2007. The new coalition has been formed following concerns about fringe credit practices.
The coalition believes predatory lending by fringe lenders in the home loan market is a serious problem requiring urgent action. It involves the deliberate targeting of borrowers who do not have the ability to pay but have equity in their homes. Predatory lending relies on that equity and victims end up losing their family home and their equity.
The forum spoke in favour of targeted reforms. Responsible lenders are committed to setting the standard for the market.
David Bell, CEO of the Australian Bankers’ Association, said: “The ABA welcomes the chance to work with consumer groups and other industry groups on practical responses to predatory lending.”
Consumer groups highlighted case studies of predatory lending by fringe lenders and the urgent need for reform.
Karen Cox, Coordinator of the Consumer Credit Legal Centre (NSW) said: "Consumers who fall victim to predatory loans risk losing not only their home, but also any equity they may have accumulated. Measures that respond to predatory lending practices are needed as a matter of urgency.”
The new coalition is working on practical options to address predatory lending and will be seeking to engage with State, Territory and Federal Governments on targeted reforms to deal with aggressive and predatory lending practices. The Predatory Lending Project is being co-ordinated by the Public Interest Law Clearing House (NSW), Legal Aid NSW and Consumer Credit Legal Centre (NSW).
All media enquires to:
PILCH: Robin Banks ph: 0423 100 807 or 02 8898 6508
CCLC (NSW): Karen Cox ph: 0409835134 or Katherine Lane ph: 0447 620 694
ABA PR: Heather Wellard: 02 8298 0411 or 0409 830 439 or heatherw@bankers.asn.au
Consumer’s Federation of Australia: Catriona Lowe ph: 0412 633 090
MFAA: Phil Naylor ph: 0411 554 048
Abacus: Louise Petschler ph: 02 8299 9046 or lpetschler@abacus.org.au