Question: Responsibilities of banks under CCCFA

Answer: If you are going to borrow money from a bank or financial institution to buy a property, your rights are protected under Credit Contracts and Consumer Finance Act 2003.The primary purpose of this Act is to protect the interests of consumers in connection with credit contracts, consumer leases, and buy-back transactions of land. The Act defines the responsibilities of a lending bank or financial institution. This is a lender's responsibility to exercise due care, diligence and skills in dealing with a borrower. The lender should assist the borrower to reach an informed decision as to whether or not to enter into the agreement and to be reasonably aware of the full implications of entering into the agreement. The lender should treat the borrower and their property (or property in their possession) reasonably and in an ethical manner, including when breaches of the agreement have occurred or may occur or when other problems arise. This is also the lender's responsibility to make sure that the borrower will make the payments under the agreement without suffering substantial hardship.