While the Treasury recently announced the government does not intend to proceed with the phase 2 NCCP credit reforms, the government has been dragging its feet with clearing up issues with the NCCP Act – and MFAA has sent them a reminder to do so quickly.
“We’re trying to get the issues resolved for our members so they know what they can and can’t do under the act,” MFAA chief executive Phil Naylor told Australian Broker.
“There’s been a bit of a stand-off with the new government coming in, but we now understand they are starting to look at problems with the act again.”
Treasury has stated it intends to proceed with the so called 'fine tuning regulations' of NCCP.
MFAA has summarised the 22 key points it has been making submissions on since the NCCP Act came in four years ago.
The one many brokers are likely to want to see changed urgently is the credit activity point of sale exemption for retailers and vehicle dealers.
“That’s one which gets a lot of brokers’ backs up,” said Naylor. MFAA seeks total removal of this exemption.
The broker representative group has also recommended key fact sheets for home loans are abandoned, because of the unnecessary compliance cost of maintaining documents which are rarely requested by borrowers.
However, if the fact sheets are not abandoned, amending the form to more clearly state what happens at the end of a fixed rate term is recommended.
Comparison rates should be stopped, as they are of limited value and can be misleading to customers, said MFAA. But if the government chooses not to stop them, the prescribed amounts should be amended due to inflation since they were set.
MFAA also recommends brokers should be able to obtain credit reports to improve efficiency, and clarify what triggers a hardship application.