Key issues: Mortgage broker | Breach of responsible lending obligations | Unsuitable loan | Delay in settlement

Summary of the complaint:

We found that the FSP, a mortgage broker, breached its responsible lending obligations under the National Consumer Credit Act 2009 (Cth) (the National Credit Act) when it assisted the consumers to enter into an unsuitable loan, and consequently, caused a delay in settlement of the investment property purchase financed by the loan, resulting in the consumers paying penalty interest to the vendor.   

Summary of Determination:

To resolve this complaint, I order the FSP to pay the consumers $15,710.43 as compensation for the loss incurred by them as a result of the FSP’s conduct.

This Determination affirms the position set out in our Recommendation dated 31 October 2016.

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