The Consumer Credit Code

Purposes of the Consumer Credit Code
What the Code covers
What the Code doesn't cover
Contracts not covered by the Code
Advantages for consumers
Hire purchase contracts
Pay-day lenders
Goods as security for loans
Help with consumer, credit, or debt problems

Most consumer credit or loan contracts entered into after 31 October 1996 are regulated by the Consumer Credit Code. This is nationally uniform legislation enacted separately in each state and territory, and in Victoria is included in the Consumer Credit (Victoria) Act 1995. Under the Act all providers of credit must be registered. The Director of Consumer Affairs Victoria (CAV) can investigate the operations of any registered credit provider.

For further information, Consumer Affairs Victoria can supply a free booklet on the Consumer Code and your rights and obligations under it.

To view a web page containing factsheets and publications from Consumer Affairs Victoria go to the CAV website - www.consumer.vic.gov.au.

A complete copy of the Code, as well as other useful credit information, can be downloaded from the National Consumer Credit Code website - www.creditcode.gov.au.

Purposes of the Consumer Credit Code

The Code has two important purposes:

to provide initial and ongoing disclosure to a borrower about the loan contract and the status of the account; and
to protect the borrower if something goes wrong.

Before a credit contract is entered into the credit provider must provide a pre-contractual statement setting out key details of the proposed contract, including the amount borrowed, the amount of interest, and other fees and charges. If the account falls into default, the borrower must be given a notice setting out what options are available, what action the credit provider may take, and allowing the borrower at least 30 days to remedy the default.

If you consider that your contract was 'unjust' at the time it was entered into or changed, you can apply to have it reopened by the Victorian Civil and Administrative Tribunal (VCAT), which can grant relief as necessary (s. 71). This relief could include changing the terms of the contract, or altering the obligations of the parties. The tribunal can take many factors into account in deciding if a contract is unjust, including whether the credit provider knew or could reasonably have found out that the borrower would have serious difficulties meeting repayments.