Commonwealth Bank has agreed to change its advertised comparison rate for the Wealth Package home loan after ASIC raised concerns that the comparison rate did not include the loan's $350 annual fee.
The National Credit Code requires that credit advertisements that include an annual percentage rate must also include a comparison rate. Those comparison rates must include the fees, charges and interest relating to the loan so that consumers can see the true cost of credit.
"It can be difficult for people to compare home loans with different combinations of interest rates and fees," ASIC Commissioner Peter Kell said. "This is why credit providers must include the comparison rate when they advertise a rate or a weekly payment for a home loan, and ASIC will be active to ensure compliance in this area."
ASIC has already provided general guidance on advertising financial products and will release a consultation paper on the subject later this year.