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BFCSA
MORTGAGE
DISTRESS SOS

What BFCSA Does...

BFCSA investigates fraud involving lenders, spruikers and financial planners worldwide.  Full Doc, Low Doc, No Doc loans, Lines of Credit and Buffer loans appear to be normal profit making financial products, however, these loans are set to implode within seven years.  For the past two decades, Ms Brailey, President of BFCSA (Inc), has been a tireless campaigner, championing the cause of older and low income people around the Globe who have fallen victim to banking and finance scams.  She has found that people of all ages are being targeted by Bankers offering faulty lending products. BFCSA warn that anyone who has signed up for one of these financial products, is in grave danger of losing their home.

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BFCSA Blog

Led by award-winning consumer advocate Denise Brailey, BFCSA (Inc) are a group of people who are concerned about the appalling growth of Loan Fraud around the world. BFCSA (Inc) is a not for profit organisation in the spirit of global community concern and justice.

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Recent blog posts
Banks running amok in NZ with interest only loans yet no NZ probe?   Interest-only mortgages touted to families who want a baby and a house Rob Stock 10 May 2017 http://www.stuff.co.nz/business/money/92162663/Interest-only-mortgages-touted-to-families-who-want-a-baby-and-a-house Heavily indebted young families struggling to cope when baby comes are helping cement the popularity of interest-only home loans. Interest-only mortgages were once considered the territory of property investors banking on capital gains, and an eventual sale, to repay their loans. But Reserve Bank figures show 16 per cent of owner-occupier home loans, or $26.5 billion of loans, were on interest-only terms at the end of February with the borrowers making no progress in paying off the money owed to the bank. The rise of interest-only home loans has authorities around the world worrying, with Australian regulator ASIC concerned that around 40 per cent of total home loan lending is in interest-only loans. READ MORE: * No justification for...
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Why has there been no Royal Commission into Bankers and Banking Products?    Banks: still the untouchables 12 December 2011 Evan Jones http://www.smh.com.au/federal-politics/editorial/banks-still-the-untouchables-20111212-1ug7i.html Ten years ago, this page published an article of mine on bank malpractice against small business/farmer clients. I wrote then: ''Major bank practices towards small business and the family farm range from the insouciant to the malicious, with parlous effects. This environment has been facilitated by comprehensive indifference to bank practices by borrower representative bodies, regulatory authorities and political parties.'' A decade later, nothing has changed. When a small business/farmer contracts for a substantial loan with a bank, they enter into the most asymmetric of any relationship in modern commerce. Henceforth, the bank has your assets and the future of your family at its discretion. Banks: still the untouchables Borrowers believe that they are negotiating with a professional, with attendant capacities and scruples. On the contrary; they are...
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Banks welcome review with reservations 8 May 2017 James Foot and James Eyres http://www.afr.com/business/banking-and-finance/financial-services/banks-welcome-review-with-reservations-20170508-gw06ap?&utm_source=social&utm_medium=facebook&utm_campaign=nc&eid=socialn%3Afac-14omn0053-optim-nnn%3Anonpaid-25%2F06%2F2014-social_traffic-all-organicpost-nnn-afr-o&campaign_code=nocode&promote_channel=social_facebook#ixzz4gX5YjIRh Australian Bankers' Association chief executive Anna Bligh says there is little left for a banking royal commission to investigate with 15 separate inquires into the sector under way including the Productivity Commission's review into competition. "We are getting very close to a full suite of issues that the public would want to look at. With this inquiry now about to start we are running out of things for  a royal commission to look into," Ms Bligh said. She said the industry did not want to speculate on what might flow from a focus on vertical integration in financial services - which could see the bank's retail and wealth arms separated - but had faith in the PC's processes. Treasurer Scott Morrison on budget night will announce a Productivity Commission inquiry into financial system competition as revealed by The Australian Financial Review on...
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Budget 2017: Don't bet the house on Scott Morrison doing anything on housing affordability ABC News8 May 2017 Ian Verrender Business editor   "Hey Rocky! Watch me pull a rabbit out of my hat." Every afternoon around 4.30pm after school, when the cartoons kicked in, those of us of a certain age would settle down in front of the telly to watch Bullwinkle interrupt the show's introduction to perform his favourite trick. Rather than a rabbit, he invariably extracted a tiger, a bear, a rhino or a lion, all of which threatened to either maim or kill the pair. If he was ever a fan of the show, Treasurer Scott Morrison is likely to experience a sense of deja vu tomorrow when he delivers his second federal budget. For no matter how much he has tried in the past fortnight to deflect attention, to focus on infrastructure and nation building, there's...
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Key player criticises plan for super watchdog The Australian 12:00am May 8, 2017 Richard Gluyas   A key player in the proposed super ombudsman to cover all disputes in the financial system has slammed the initiative, saying it will be completely unaccountable, “powerless” to prevent future big-bank scandals and make smaller players uncompetitive by burdening them with huge costs. In a damning assessment of the so-called “Super FOS”, due to be announced in tomorrow’s budget, the head of one of the three schemes to be merged said the irony was that the major banks would emerge as big winners. “(The major banks) know the review is a diversion to avoid a royal commission,” said Raj Venga, chief executive and ombudsman at the Credit and Investments Ombudsman. “Yet everyone who competes against them is against it.” The Australian at the weekend revealed plans for a three-way merger between the CIO, the Financial...
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Budget to pressure big banks Australian Financial ReviewMay 7 2017 11:45 PM Phillip Coorey   Exclusive  The Turnbull government will go after the banks in tomorrow's federal budget with new measures to boost competition, as well as a Productivity Commission inquiry into further changes, including the possible separation of the banks' retail and financial advice arms. In an exclusive pre-budget interview with The Australian Financial Review, Treasurer Scott Morrison said despite some competitive advances driven by innovation and technology, the major banks had grown more powerful since the Global Financial Crisis. "There should be no denying that there has been an increased consolidation of the position of the major banks," he said. "Of itself, that is just a fact, one is not saying that is a good thing or a bad thing but it is important ... that we understand what are the barriers and what are the things preventing customers...
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PC bank inquiry fails to dampen calls for royal commission Australian Financial Review May 8 2017 5:29 PM Phillip Coorey   The federal government's decision to conduct a comprehensive Productivity Commission inquiry into the state of competition in the banking sector has failed to quell demands by Labor and the minor parties for a royal commission or something similar. A day after Treasurer Scott Morrison told The Australian Financial Review the inquiry would be announced on budget night, alongside some immediate measures to boost competition in the financial services sector, Labor, the Greens and the Nick Xenophon Team were unmoved. "There is nothing this government won't do to avoid establishing a royal commission into the financial services sector," said shadow treasurer Chris Bowen. "This is another case of too little, too late." The Greens, who are one vote short in the House of Representatives from establishing a Parliamentary Commission of Inquiry,...
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Big banks’ retail divisions run out of steam The Australian 12:00am May 9, 2017 Richard Gluyas   The post-crisis boom in retail banking is over. That’s the big theme to come out of the major banks profit reporting season, and it means the sector’s four chief executives will be desperately hoping Scott Morrison can pull something out of the bag — anything — to make businesses dust off their long-dormant investment plans. On past experience the CEOs shouldn’t hold their breath. The March half-year profit ­results demonstrated yet again how much the banks rely on their retail divisions, particularly home lending. On PricewaterhouseCoopers numbers, residential mortgages now account for two-thirds of the major banks’ gross lending, up from 59 per cent in 2009. Home lending also contributed 80 per cent of the sector’s loan growth for the most recent half. While Commonwealth Bank’s retail division delivered an outstanding result for the...
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Westpac CEO Brian Hartzer defends bank’s wealth unit BT The Australian 12:00am May 9, 2017 Glenda Korporaal   Westpac chief executive Brian Hartzer has signalled he will strongly resist pressure to spin off the bank’s wealth management arm, BT, in any government- backed review of the industry. “Customers need more financial advice, they need more insurance,” Mr Hartzer said as the Turnbull government announced plans for a Productivity Commission review of competition in the financial system. “We think the banks are well placed to provide this in a sustainable way, free of conflict and abuse and our customers can get a lot of benefit from it.” But Financial Systems Inquiry chairman David Murray has backed a Macquarie Group-style structure where banks have their banking and wealth management arms separated under a common holding company. Mr Murray, a former chief executive of the Commonwealth Bank, told The Australian he felt the holding...
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Ratings agency Moody's puts federal government on notice Australian Financial ReviewMay 8 2017 11:45 PM Jacob Greber, Phillip Coorey   A key ratings agency behind Australia's AAA credit rating is wary of today's federal budget, which is expected to forecast a return to surplus by the end of the decade while at the same time spending big to win back disgruntled voters. Moody's Investors Service issued the warning ahead of the budget, which is believed to contain a number of so-called integrity measures – including a crackdown on welfare and the black economy, and public sector efficiency dividends – to pay for extra spending, including the dumping of up to $10 billion of unpopular cuts to welfare and higher education that have lingered since the 2014 budget. Moody's has also raised questions over the economic growth forecasts that are expected to underpin this year's budget. With the budget to also focus...
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Australian Bankers admit record numbers under MORTGAGE STRESS with Jumbo 'Interest Only' toxic Loans   Affluent suburban postcodes feature among an estimated 1,000 households a week expected to face mortgage default over the next 12 months, the analysis reveals. "Debt stress momentum is unprecedented," according to Martin North, principal of research firm Digital Finance Analytics, who has been doing the survey for more than 15 years. "This is not just about mortgage battlers. It is also hitting the households with bigger incomes and more leverage. It is worrisome," Mr North said. Numbers of borrowers in severe distress has increased by about one-third to about 32,000 in the past 12 months, he said. Concern that 767,000 households – or one-in-four across the nation – are facing financial distress follows last month's warning by the Reserve Bank of Australia about increasing family "vulnerability" caused by soaring property prices, particularly in Melbourne and Sydney....
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Budget to pressure big banks Australian Financial Review May 7 2017 11:45 PM Phillip Coorey   Exclusive  The Turnbull government will go after the banks in tomorrow's federal budget with new measures to boost competition, as well as a Productivity Commission inquiry into further changes, including the possible separation of the banks' retail and financial advice arms. In an exclusive pre-budget interview with The Australian Financial Review, Treasurer Scott Morrison said despite some competitive advances driven by innovation and technology, the major banks had grown more powerful since the Global Financial Crisis. "There should be no denying that there has been an increased consolidation of the position of the major banks," he said. "Of itself, that is just a fact, one is not saying that is a good thing or a bad thing but it is important ... that we understand what are the barriers and what are the things preventing customers getting a better...
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Sydney mortgage affordability hits all-time low   By Unconventional Economist in Australian Property at 11:35 am on May 4, 2017 | 2 comments   By Leith van Onselen   https://www.macrobusiness.com.au/2017/05/sydney-mortgage-affordability-hits-time-low/   BIS Oxford Economics has done some interesting analysis for The Guardian showing that Sydney’s mortgage affordability is now the equal worst on record, with Melbourne’s just below 2008’s record low, driven primarily by housing investors:   As of December 2016, 42% of the average disposable income of a New South Wales household was swallowed up by monthly mortgage payments on a median-priced house in the capital – after a 25% deposit.   It was the same in 2008, still the highwater mark of housing unaffordability in all but one Australian capital. Melbourne at 37.1% in December was forbidding but it was worse there in 2008 (38.1%) and 2010 (37.4%)…     Richard Robinson, senior economist for BIS Oxford, says the...
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Just substitute Australia for Spain..........   Spain’s Government Presses Property-Bubble Rewind Button   by Don Quijones • May 6, 2017    http://wolfstreet.com/2017/05/06/spains-government-presses-property-bubble-rewind-button/ Taxpayer-funded subsidies to benefit banks, real estate agencies, construction companies, PE firms, and landlords. After spending the last few years groggily getting back onto its feet following the collapse of one of the most spectacular — and destructive — real estate bubbles of this century, Spain’s economy is once again being primed for another property boom. In the last quarter prices registered a year-on-year rise of 4.5%. Rents are also surging, though the country is still home to over half a million vacant properties. The cost of renting in Madrid and Barcelona, which between them account for 16% of those vacant properties, has reached historic highs, according to a new study by the online real estate market place Idealista. In Madrid, rents have risen on average by 27% since...
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AUSTRALIAN BANKERS SCANDAL   Parents aged 55 and over? This is a MUST READ.................The 30 year mortgage LOW DOC loans are geared to IMPLODE WITHIN 5 YEARS. These loans are INTEREST ONLY, yet borrowers, upon signing, are not told of this fact. Consumers are not warned of risks. Victims will tell you that Mortgage Fraud is a MEGA BANK TRAP in Australia. Credit Cards, Buffers, Top Ups, LOCs all add to that debt and are a major part of the scandal. NO DEPOSITS are required. Loans are approved when the true incomes show these loans are UNAFFORDABLE, unsustainable and all loans are unverified.   I am always happy to help families understand more about mortgage fraud. If your extended family is suffering, then you need to join BFCSA, and read more on what has happened to them re Mortgage Fraud. Your income details are exaggerated BY THE BANKS, via a...
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INTENTION to DECEIVE by Bank Engineers is a CRIMINAL OFFENCE.   As a VIP guest of the Victorian Government, I stated the following at a dinner of VIPs in 2004. I sat next to ASIC Mr Peter Kell. I also wrote the following in my own reports to Parliament and with regulators over and again. I initially used this analogy in 2001 regarding MIS Scams. as a way of describing the offences being committed and suggesting again there is NO CONSUMER PROTECTION in Australia at the present time.. In 2004 I repeated the same comparison of Government failure re consumer protection relating to banks. "If a consumer buys a washing machine and it is faulty we blame the product MANUFACTURER. Same with a car. Our laws provide safety for consumers, in that the product MUST BE RECALLED. But when the consumer is entrapped in a faulty BANK PRODUCT (ie Low...
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Genworth Mortgage Insurance warns of risky home loan deposits The Australian 12:00am May 4, 2017 Michael Roddan   The nation’s largest mortgage insurer has warned that borrowers are scraping together deposits with credit card debt, parental loans and other forms of risky “unsecured debt” as tougher regulations force lenders to require larger deposits. The warning comes as the prudential regulator has admitted it is unable to gauge whether some banks are writing loans to owner-occupiers or investors, potentially stymieing efforts to clamp down on rampant investor lending to derisk the housing market. Genworth Mortgage Insurance yesterday revealed a sharp spike in loan defaults over the March quarter, with the company’s loss ratio jumping from 27 per cent to 35 per cent year-on-year. Delinquencies across the company’s loan portfolio surged 18 per cent over the same period. National Australia Bank will today provide an update on the amount of its own borrowers...
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Severe mortgage stress puts 52,000 Australian households at risk of defaulting, analyst says By Stephanie Chalkley-Rhoden Updated yesterday at 1:50pm PHOTO: Higher mortgages and static wages are combining to make repayments tough, Martin North said. (ABC News/Nic MacBean) RELATED STORY: Even experts are divided on where property prices are heading MAP: Australia Almost 52,000 Australian households are at risk of defaulting on their mortgages in the next 12 months and a quarter of home owners are under home loan stress, a data analyst has said. Key points: Mortgage stress now spreading to more affluent areas, researcher says Half of people under financial strain don't have a budget, survey finds WA, Victoria and Queensland leading the way on default risk   According to Digital Finance Analytics (DFA), 767,000 households were in mortgage stress in April, meaning they had little leeway in their finances, up from 669,000 the previous month. Of those, it said 32,000 were in severe stress...
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As ASIC fiddles (2000) , bring on the finance broker Royal Commission. RC with Ian Temby QC......  achieved by people power in 2001.   Note: RECA is the fore-runner of BFCSA. 22 April 2001 https://www.crikey.com.au/2001/04/22/as-asic-fiddles-bring-on-the-finance-broker-royal-commission/ In order to avoid yet another stream of threatening letters, we will keep this yarn very simple, whilst we consider the LINKS.  In 1992, Krafty Ken was Chairman of Perpetual Trustees and he still sits on the board today. Two notable employee/managers of PTs were arranging “loans” for borrowers, who have since been arrested and charged and named in parliament as the notorious “dirty dozen.” Two PT account managers moved to Clifton Partners, the company who affected a slight name change to Knightsbridge with the full knowledge and blessing of ASIC. With $160 million falling rapidly into default, ASIC kindly placed everyone on the “run-out” program along with 120 other solicitor mortgage “run-outs.” We note that...
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  BFCSA: Be Warned of the old Lib Plan to split home loans into   partnerships. Another daft idea   Originally Posted by Deniseon Monday, 06 June 2016 in ROYAL COMMISSION URGENT     Lenders berate Howard's plan to split home loans By Tom Allard October 2 2002 http://www.smh.com.au/articles/2002/10/01/1033283491325.html A Liberal Party proposal to boost home ownership by encouraging financial institutions to become silent partners in properties has been dismissed by lenders as impractical, with the potential to further inflate the property price bubble. Some economists also criticised the idea of split equity loans, saying they would fuel inflation and disadvantage the people they were designed to help - those unable to enter the market in expensive cities such as Sydney and Melbourne. Analysts say the Prime Minister, John Howard, is acutely sensitive about the possibility of a property downturn after a surge of home buyers were encouraged to enter the...
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Four ways an Australian housing bubble could burst, illustrated There's been quite a bit of speculation over whether Australia has a property market bubble — where house prices are over-inflated compared to a benchmark — and when it might burst. According to housing experts, there's at least four scenarios where this could happen. Australia could see a property bubble burst due to: Lending tightening, interest rate hikes and mortgage stress Underemployment and unemployment creating a slow deflation Government intervention failure and market repair Global crisis These four scenarios focus on different tension points in Australia's and the global economy. One scenario focuses on the balance of actions between regulators like the Australian Prudential Regulation Authority (APRA) and the Reserve Bank of Australia (RBA), combined with household mortgage stress. Another envisions the effect that unemployment might have in certain areas. Some of the factors we may see play out, such as the federal and...
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FBAA defends commission model to Senate inquiry   1 May 2017   Annie Kane   https://www.theadviser.com.au/breaking-news/36012-flat-fee-model-could-lead-to-poor-consumer-outcomes-fbaa   The industry association has defended the current broker commission model to the Senate economics references committee and warned that switching to a flat fee model could lead to “extremely poor consumer outcomes”.   At a public hearing in Sydney last week, the executive director of the Finance Brokers Association of Australia (FBAA), Peter White, was questioned on the Australian Securities & Investments Commission (ASIC) report into remuneration and whether there were any poor consumer outcomes happening in the broker sector.   Touching on the ASIC recommendation that lenders “change their standard commission arrangements so that brokers are not incentivised purely on the size of the loan”, the senate questioned whether fees for service, rather than commissions, would be a suitable alternative.  However, Mr White told the senators that this would not be in the best interest of the...
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Record numbers under mortgage stress   1 May 2017 Duncan Hughes http://www.afr.com/personal-finance/record-numbers-under-mortgage-stress-20170501-gvw2vt Record numbers of Australian households face mortgage stress as large loans and rising interest rates start to bite, according to detailed analysis of lending, repayments and household incomes. Affluent suburban postcodes feature among an estimated 1000 households a week expected to face mortgage default over the next 12 months, the analysis reveals. "Debt stress momentum is unprecedented," according to Martin North, principal of research firm Digital Finance Analytics, who has been doing the survey for more than 15 years.  "This is not just about mortgage battlers. It is also hitting the households with bigger incomes and more leverage. It is worrisome," Mr North said. Numbers of borrowers in severe distress has increased by about one-third to about 32,000 in the past 12 months, he said.  Concern that 767,000 households – or one-in-four across the nation – are facing financial distress...
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ASIC admits product manufacturers try to shift blame   1 May 2017   Mike Taylor   http://www.moneymanagement.com.au/news/financial-planning/asic-admits-product-manufacturers-try-shift-blame   The Australian Securities and Investments Commission (ASIC) has acknowledged that product manufacturers have too often blamed distributors such as financial planners when product failures have occurred.   ASIC deputy chairman, Peter Kell has told the Senate Economics Committee inquiry into consumer protection in the banking, insurance and financial sector that such instances have occurred over many years.   Explaining why ASIC was pursuing a product intervention power, Kell said there had been an unwillingness on the part of product manufacturers to take responsibility.   Related News:   ·         Investment leaders need to transform their business   ·         Average 3.8 days for approval to go off APL   “… one of the problems we have typically encountered over many years in this sector is that if something goes wrong you often have the product...
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300,000 Victorian households struggling to meet repayments Michael Mata 28 April 2017 http://www.yourmortgage.com.au/article/300000-victorian-households-struggling-to-meet-repayments-235555.aspx   Hundreds of thousands of Victorian households are under mortgage stress, and many more would be pushed to the brink of defaulting on their loans if banks continue to hike their interest rates, warns consulting firm Digital Finance Analytics (DFA).  Some 300,000 Victorian homeowners are struggling to meet their mortgage repayments – a figure that would nearly double if interest rates were to rise by 2%. As the Turnbull government scrambles to tackle the housing affordability crisis in the upcoming May budget, economists warn that rising interest rates would hurt those who’re barely holding onto the property ladder.  Modelling produced by the DFA shows that property-owning, working-class families in Narre Warren, Craigieburn, Endeavour Hills, and Berwick are facing the most acute mortgage stress. Even a mere 0.5% interest-rate rise would put an additional 50,000 owner-occupiers and investors...
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