Westpac, St George: Banks hit by class action over car loan ‘flex commissions’

Westpac, St George: Banks hit by class action over car loan ‘flex commissions’

Alannah Fox was forced to pay a whopping $24,864 in interest for a 2015 Hyundai. Now, she and many other Aussies are fighting back.

Alexis Careycarey_alexis When Alannah Fox bought her first new car, she trusted she was getting a fair deal on her loan. Instead, the teachers’ aide, who was 25 at the time, was charged 12.99 per cent on a loan of just over $47,000 – which meant she had to pay a staggering $24,864 in interest for her 2015 Hyundai ix35. She claims she was only told of the interest rate after the deal was struck. “They didn’t tell me the interest rate until I went to pick up the car. We bargained hard on the initial price, but I believe they knew what they were doing and slugged me with the high interest rate to compensate,” Ms Fox said. Ms Fox is now one of the lead applicants in a new class action over shonky bank car loans, which leadi…
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Home loan customers may need to pay mortgage brokers to save money

Home loan customers may need to pay mortgage brokers to save money y business reporter Daniel Ziffer Posted SatSaturday 9 FebFebruary 2019 at 6:07am Almost 60 per cent of Australians use a mortgage broker to arrange their home loans.(AAP: Lukas Coch) Borrowers may have to pay an upfront fee when their home loan is arranged, in a move applauded by consumer advocates but which mortgage brokers say would devastate their industry.

The new fee, one of the most contentious changes recommended by the final report of the Hayne royal commission, would kill off one of the key methods brokers are currently paid — an arrangement commissioner Kenneth Hayne rubbished as "money for nothing".

Currently, most brokers are paid an upfront commission by the bank that finances the loan. The banks then also pay an ongoing fee, called a trail commission, over the life of the loan.

Under the comm…

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OnDeck Australia targets young and unsecured

OnDeck Australia targets young and unsecured By Shaun Drummond OnDeck Australia chief Cameron Poolman says there is a big opportunity for the new business lender to satisfy demand from emerging entrepreneurs who cannot offer up a home as security for a bank loan. Cameron Poolman, local chief executive of US online business lender OnDeck, says it wants to be a mainstream business lender, not just a small alternative.CREDIT:LOUIE DOUVIS The local arm of one of the biggest of the new online business lenders, OnDeck Capital, quietly began lending in Australia two weeks ago, seven months after establishing its third office outside the United States. In Australia, banks don't lend to small business without security – usually the family home. But Mr Poolman said apart from the existing 2.1 million small businesses, there is emerging demand from an increasingly entrepreneurial younger generation who have no home to offer as security. …
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