A Question on Shelter (1 Viewer)

[kcrocks]

My teacher has given us a series of question on shelter, but there's one I can't find an answer for.

Q: How are borrowers protected?

The only thing I was thinking that in an equitable mortgage, where equity can take over, but I'm not sure if that's the answer

Thanks for the help!

Edit: i also found mortgage insurance...

 

[sam5]

umm i can think of a few things but not many.

• right to have a free glace at credit reports, to have information on credit resports changed if incorrect and that lenders need borrowers permission to have a look at a credit report. Found in the Privacy Act 1988 (NSW)
• Mortgage protection insurance; if they cannot pay due to illness or misadventure for a time period
• Contracts Review Act 1980 (NSW) states in sec4(1) that nobody should be subject to an "unconscionable, harsh or oppressive" contract, thus protecting borrowers against dodgey credit providers.
• The Consumer Credit Act 1995 (NSW) regulates mortgages, their types and the rules of them. This would stop borrowers being ripped off or deceived.
• Mortgage Brokers have to be licensed by the Mortgage Industry Assiation of Australia following an ASIC report in 2003 finding that mortgage brokers were misleading borrowers into unsuitable mortgages simply for the size of their personal commission.

Hope that helps.