Andrew Smith  
Partner

Sydney
Greg Hammond  

Melbourne
Katherine Forrest  

Perth
John Naughton  


25 November 2005

Changes coming to consumer credit law

Amendments are planned to the Uniform Consumer Credit Code to clarify that it covers solicitor lending, vendor finance and instalment contracts. From next year, consumer credit contracts in NSW will have to include all fees and charges in the calculation of their maximum 48% annual interest rate, following the introduction of an amendment Act.

Uniform Consumer Credit Code to cover solicitor lending, vendor finance and instalment contracts

The Uniform Consumer Credit Code is to be amended to clarify that it covers solicitor lending, vendor finance and instalment contracts. A draft bill has been released on which the Uniform Consumer Credit Code Management Committee invites comments by 9 December 2005:

NSW extends coverage of maximum interest rate limits

New consumer credit contracts in NSW will have to include all fees and charges in the calculation of the maximum 48% annual interest rate. This is the result of an amendment to the NSW Consumer Credit Act, which is expected to come into operation in March 2006.

Existing consumer credit contracts will be exempt, unless fees under the contract are varied or new fees introduced, or the term of the contract is extended.

Download Consumer Credit (NSW) Amendment (Maximum Annual Percentage Rate) Act 2005

Other states and territories are considering implementing similar legislation.