Besides financial planning, we also offer mortgage broking from our location in the Perth area. One of the first things that is done in the process of applying for any loan is to run a credit check. This credit report is an important part of determining whether or not you are able to obtain the financing you need for a home loan.
Unfortunately, some people don’t know their full rights under the National Credit Act and fall prey to predatory tactics. Courtesy of the ASIC’s MoneySmart website, we would like to remind you of some basic rights and safeguards that are designed to help consumers know exactly what they are getting into.
Obligations of Credit Providers
The National Credit Act establishes rules to help protect consumers from fraud. Everyone who wants to lease, provide or broker a loan must register with ASIC or work for someone who is registered.*
According to the National Credit Act, no credit provider may enter into any agreement with you that the Government would classify as “unsuitable.” This includes any contract that doesn’t meet your objectives or requirements. It also includes any loan which would inflict hardship upon you while trying to repay it.*
Credit providers also must make reasonable enquiries about your objectives, requirements and financial situation. They are required to make a reasonable effort to verify your financial situation. They must decide whether or not any particular credit product is suitable or “not suitable” for you.
Before you receive a loan, the credit assistance provider must make a preliminary assessment on the suitability of any credit product for which you apply. The credit provider then makes the final assessment and final decision. Both must decide that the product is “not unsuitable” for you before offering you credit.
Call the Professionals
At Approved Financial Planners, we have developed a great reputation around Perth for our accurate financial assessment and advice. For a “financial checkup,” call us today: 08 6462 0888.
*ASIC, MoneySmart. “Consumer Credit Regulation.”