The FBAA is calling on banks to stop sitting on discharge requests and hasten the mortgage transfer process.
This was one of the key issues the FBAA’s chief executive Peter White talked about when he attended an invitation-only roundtable discussion with Federal Minister for Small Business, Bruce Billson.
“Banks are notorious for holding onto a customers’ mortgage as long as possible and we urge them to stop this unfair practice,” White said.
Currently there are no regulations or requirements about the time it takes from the approval process through until settlement.
“This is the crux of the problem. If banks know they have a limited time frame, we wouldn’t have lenders sitting on dischargers for as long as they want.
“Time is money and while banks make more through maximising revenues and fee charges, the customer is the one losing out.
“This delay impacts consumers and especially small businesses who need to take advantage of commercial opportunities.”
The delays are another reason why the negative image of lending institutions remains, says White.
“The government continually tries to make things easier for those needing a loan but in the process is being deliberately stalled by the banks looking to profit at the expense of goodwill.”
The FBAA was the only body from the finance industry to attend the forum, which also had representation from the retail, food and travel sectors.