I have some important news that I wanted to make you aware of. The Government has announced today big changes to the Credit Contracts and Consumer Finance Act (CCCFA). This follows a storm of criticism of the Act and a review ordered by the Minister of Commerce and Consumer Affairs, David Clark.
The Act, which came into effect last December was intended to protect vulnerable borrowers, but ended up penalising almost everyone. In some instances, people have been declined a home loan due to their takeaway spending habits.
The changes announced today provide alternative guidance and examples for banks when it is ‘obvious’ that a loan is affordable. Banks should now be able to apply a more “common sense” approach to lending which is how they had always traditionally operated.
I remain optimistic that the banks will be able to implement these much-needed changes to their various lending policies soon. Overall, this is very good news now to anyone currently seeking finance from a bank.
Enjoy your weekend.