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Australian banks show no mercy to loan battlers: foreclosure sign of the times
December 10, 2011 by Editor · Leave a Comment
Up to 70 Victorians are forced from their homes or threatened with eviction every month, some over debts as small as a few hundred dollars.
As the big banks baulk at demands to help struggling home owners, a Herald Sun investigation has found lenders are claiming back about $30 million a month through repossession actions in Victoria.
The first two banks to belatedly pass on this week’s interest rate cut – NAB and ANZ – were also the most prolific at repossession.
Not only are the banks kicking people out, they are demanding tens of thousands of dollars in interest, leaving customers both homeless and deep in debt.
An analysis of court records found:
The big banks, which provide two-thirds of residential mortgages in Victoria, brought a third of repossession actions in the past 18 months. The remainder were driven by smaller lenders.
NAB was the most inclined to issue repossession writs. Despite providing only 10 per cent of mortgages in Victoria, NAB drove 60 per cent – or 305 – of the big bank repossession bids. CBA was the least hostile, moving to reclaim only six properties since July last year, while ANZ and Westpac started 275 and 222 mortgage repossession actions.Melton, Cranbourne, Narre Warren, Reservoir and Hampton Park faced multiple foreclosure actions.
In one case, a homeowner was made to pay $700 in “enforcement fees” linked to the repossession action.
Another was threatened with foreclosure for missing just $600 in repayments.
Lenders are chasing entire homes, plus interest.
They moved to repossess at least 2710 Victorian homes in the past 18 months.
In the past year, Sheriff’s officers have forced 274 people from their homes on court orders, either by physically locking them out or through discussion.
Treasurer Wayne Swan has encouraged angry borrowers to switch lenders, but the Herald Sun found smaller banks, credit unions and less regulated mortgage brokers were driving most eviction actions.
The big four instigated 808 repossessions since June 2010, with smaller institutions forcing the rest, led by Secure Funding, Equity One, Perpetual, Bank of Queensland and Bank of WA.
Gerard Brody, of the Consumer Action Law Centre, said repossessions were creeping up as home buyers came under financial stress.
“They went down and the banks were trying to be more generous during the global financial crisis, but they’re going back up,” he said.
Financial and Consumer Rights Council chief Peter Gartland said banks were legally bound to discuss alternatives with customers.
Source: News.com.au
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