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Banks slammed for failing to pick up mortgage offset problems
Brooke discovered her offset account was not linked to her home loan when she went to refinance. (ABC News: Lucas Hill)
Millions of Australians use offset accounts to reduce interest costs on their mortgage, but the corporate regulator says some banks are not delivering the savings as promised.
ASIC found Australian banks paid more than $55 million in compensation to customers in just two years, for failures with mortgage offset accounts.
The regulator said several banks had begun remediation and it would monitor their fixes, provide individual feedback and consider further regulatory action.
Millions of Australians use mortgage offset accounts to reduce interest costs on their home loans, but the corporate regulator says some banks are not delivering the savings as promised.
Check your offset account: Are the banks returning to bastardry?
It was eight years ago, during a bruising royal commission, that Australia’s banking industry sustained injury to its image so damaging that it lost the community’s trust.
Now, after several years of rehabilitation efforts by the banks, behavioural creep is emerging again. The latest example is the shortchanging of hundreds of thousands of customers with mortgage offset accounts. The systemic nature of this issue was uncovered by the Australian Securities and Investments Commission.
The backlash from the royal commission’s revelations of banks’ bad behaviour wiped out a legion of the industry’s board directors and executives on the back of a community shaming exercise.
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Mortgage offset account errors mean some Australians are owed thousands of dollars. Are you among them?
Asic review finds banks repaid millions to borrowers who unknowingly paid too much interest on their home loans
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The corporate regulator has detailed how banks have had to pay tens of millions of dollars in compensation to customers for mortgage offset failures.
In a new report, the Australian Securities and Investment Commission showed lenders repaid $55m to customers over two years after they unknowingly paid too much interest on their mortgages – and warned the number would climb higher.
Here’s how to check whether you have fallen foul of what could be an expensive administrative error.
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