ob体育 has accepted a court enforceable undertaking and fined timeshare lender Future Holiday Finance Pty Ltd (FHF) for responsible lending failures. FHF has paid a penalty of $135,000 in response to three infringement notices and will pay up to $3 million in compensation to consumers.
FHF provides finance for the purchase of memberships in ULTIQA Lifestyle, a points-based timeshare scheme.
ob体育 found that FHF signed consumers up to loans when they attended ULTIQA Lifestyle timeshare sales seminars, without first assessing if customers could afford the loans or if the loans were right for them. 聽As a result, ob体育 has issued three infringement notices to FHF for alleged breaches of its responsible lending obligations.
As well as failures with the timing of FHF鈥檚 loan assessments, ob体育 had concerns about their quality. The court enforceable undertaking addresses FHF鈥檚 poor loan assessment practices which did not meet the standards required by law.
In addition, ob体育 examined FHF鈥檚 loan document and identified a potentially unfair contract term. ob体育 was concerned that the 鈥榚ntire agreement clause鈥� prevented verbal statements made by FHF from forming part of the contract. This clause is no longer included in the loan contract and FHF has agreed not to enforce this clause in any existing contract.
FHF will offer to review the loans of all customers who entered into contracts between 1聽July 2012 and 30 August 2018. Refunds will be provided to customers where contracts were not suitable. This compensation program will be overseen by an independent expert who will also assess FHF's compliance with its responsible lending obligations and whether the company鈥檚 credit contract contains any unfair terms.
ob体育 Deputy Chair Peter Kell said, 'Timeshare finance operators must ensure that they comply with their responsible lending obligations.鈥�
'Consumers should always take the time to consider upfront and ongoing costs of timeshare, including finance, given they are a long-term commitment and can be difficult to sell.鈥�
ob体育 encourages customers who took out a loan to purchase their ULTIQA Lifestyle timeshare membership to ask for their loan to be reassessed. Customers can contact FHF on (07) 5556 3000. ob体育鈥檚 MoneySmart also has information about FHF鈥檚 .
Background
FHF holds Australian Credit Licence 383982.
ob体育 can issue an infringement notice where it has reasonable grounds to believe a person has contravened certain consumer credit protection laws. The payment of an infringement notice is not an admission of a contravention of the National Consumer Credit Protection Act 2009 (Cth).聽
ob体育 is updating the regulatory framework for timesharing schemes. It is proposed that additional consumer protections apply, including to reflect the fact that it is common for a financier related to the timeshare operator to fund an acquisition of timeshare interests. ob体育鈥檚 website contains further detail of the proposed changes.
ob体育 raised concerns with ULTIQA Lifestyle's disclosure and sales practices in 2016 ()
ob体育鈥檚 MoneySmart explains what to look out for when .