New Zealand Law Society - Credit law compliance check urged for retirement villages

Credit law compliance check urged for retirement villages

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The Commerce Commission has reminded retirement villages to ensure their consumer credit contracts and lending practices comply with the law.

It says some retirement villages offer credit to residents to assist them to enter their village or to acquire goods once they are living there. All businesses that offer credit to consumers are required to meet certain obligations under the Credit Contracts and Consumer Finance Act 2003 (CCCFA).

Commissioner Anna Rawlings says it is important that retirement village residents get all the information they need when they take out a loan or buy goods on credit.

“The CCCFA is designed to protect borrowers’ rights and this law was strengthened last year. The retirement village industry needs to ensure villages are following these important lending requirements when offering credit to their residents,” she says.

Ms Rawlings says the Commission was recently pleased that Bupa Retirement Villages Ltd voluntarily reported possible non-compliance to the Commission. Bupa realised it had not disclosed all the necessary information when offering loans for heat pumps and loans to assist residents to enter its retirement villages.

“Bupa corrected its disclosure and is in the process of compensating affected debtors. We issued compliance advice to the company in this instance and acknowledged the remedial steps it had taken, and continues to take, and its proactive approach to alerting us to the issue,” she says.

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