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National Consumer Credit Protection Act

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| 30 Nov 2010, 02:39 AM Agree 0
This forum is for a basic outline to the new legislation that came into force as at 1/7/2010 and is supposed to come into full swing as at 1/1/2011.

The current government back in 2009 passed the National Consumer Credit Protection Act through Parliament.

In a nutshell, it now governs the way that all credit providers deal with clients and the extent of the investigation that the credit provider needs to conduct to ensure that a client is not taking an "unacceptable product" for their individual circumstances. These credit providers include Mortgage Brokers, Banks and nearly any person or organisation that is engaged in credit activities.

Simular to finacial planners, all credit providers should be undertaking a full fact finding mission on the client and taking into account now and later principles and if they deem that a product is suitable now, but not in the future, then they are obligated to not offer that product or service.

All credit providers are now required to be licenced with ASIC or must be an authorised credit respesentative under a credit licence and once again listed as that with ASIC.

It governs disclosure of commissions to the clients and in part even goes as far a commissions payable to referral sources such as Real Estate agents and accountants.

Next time your looking at finance, make sure that your provider is supplying you with the information that you require and they are taking into account your needs now and in the future.
  • alvinwright | 01 Aug 2012, 12:09 PM Agree 0
    These new acts should be revised so as to get better transparency in terms of credit protection, lot of issues faced by customers and it is because hard and fast rules are not there to support in such kind of cases.
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