The Finance Brokers Association of Australia (FBAA) has revealed it is working to reduce the amount of “disclosure” paperwork associated with consumer lending and mortgages under the NCCP.
CEO Peter White says he and federal treasury officials are looking at ways to simplify the disclosure obligations so that “people can understand what is happening with their mortgages”.
“While I acknowledge the intention of the act is transparency around terms and conditions, the irony is that there is now so much paperwork, people are not even trying to understand it.”
“There are 60 to 100 pages of disclosure paperwork for a mortgage, and when you add in all of the applications, contracts, guides and the mortgage document itself, it can come to hundreds of pages.
“It’s all done for the right reasons, but disclosure and comprehension are not synonyms.”
Mr White said the mountains of paper are an unintentional consequence of the new act, but it now needs to be simplified.
“Instead of consumers reading a little bit of what they used to get, they are now potentially reading nothing because it’s too overwhelming.”
He said if every page was read and explained between the customer, broker and solicitor, it would take four to five hours.
“The FBAA is continuing to talk to treasury and regulators and we are confident of progress.”