Yahoo Finance Westpac class action: Is your home loan involved?
Australian mortgage-holders have hit back against Westpac with a class action involving potentially thousands of home loan customers.
Class action litigator, Maurice Blackburn, announced today that it would take action in the Federal Court against Westpac and its faulty borrower assessment metrics.
This case marks the first legal case against a major financial institution in the wake of the Royal Commission’s final report.
“Westpac is required to comply with strict obligations which are specifically designed to protect consumers from irresponsible lending and the risk of financial hardship,” Maurice Blackburn principal lawyer Ben Slade said today.
“This case will seek to prove that Westpac failed to comply with these obligations and that this failure caused substantial losses for many consumers.”
Westpac came under fire last year for its reliance on the Household Expenditure Measure (HEM) to calculate borrowers’ ability to make repayments, in place of a detailed analysis of borrowers’ finances.
Maurice Blackburn said it will conduct the class action on behalf of those who were entered into unsuitable loans since January 2011 as a result of this metric, and suffered harm as a result.
The litigator estimated this group will number in the thousands.
“Our current estimate shows there will be thousands of people and thousands of loans affected,” Slade told the ABC.
“We are anticipating a lot of people are caught up in this and can participate in the claim.”
They’re seeking compensation for losses and orders preventing Westpac from causing continued losses.
Westpac admitted late last year that it had breached responsible lending laws, with 105,000 loans which should have passed through a manual assessment automatically approved.
– With AAP.
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