Loan sharks will be rubbing hands over Govt housing policies
Consumer Rights and Standards Spokesperson
25 September 2013 MEDIA STATEMENT
Loan sharks will be rubbing hands over Government housing policies
New lending restrictions on home loans due to come into force next week will drive people who can least afford it to high interest lenders, including loan sharks, says Labour’s Consumer Rights spokesperson Carol Beaumont.
“First home buyers are already up against the odds to get into the housing market. The new restrictions will only provide more opportunities for predatory lenders to hawk their product.
One finance company, Loan Direct - already issuing more personal loans for home deposits - expects customer numbers to jump in line with the October 1 clampdown on low deposit loans.
“No doubt this will include hundreds of borrowers who had their pre-approved loans cancelled by ASB bank.
“National’s failure to address housing affordability or exempt first home from the Reserve Bank’s new home loan restrictions, combined with its failure to address the need to better regulate the consumer credit market, can only lead to further hardship for Kiwis looking to own their own home.
“It has been crystal clear for years that the third tier/predatory lending market has needed better regulating. Unfortunately this Government has not prioritised its reform and we are now seeing the result.”