(1) A credit provider must, not later than the day on which a change in the annual percentage rate or rates payable under a credit contract takes effect, give to the debtor written notice setting out:
(a) the new rate or rates or, if a rate is determined by referring to a reference rate, the new reference rate; and
(b) any information required by the regulations.
Criminal penalty: 100 penalty units.
Notification by publication
(2) Notice under subsection (1) may be given by publishing the notice in accordance with subsection (8). A credit provider that gives notice in accordance with this subsection must give to the debtor particulars of the change before or when the next statement of account is sent to the debtor after the change takes effect.
Criminal penalty: 100 penalty units.
Changes in reference rates
(3) Subsection (1) does not apply to a change in a rate that is determined by referring to a reference rate if the changed reference rate is notified (whether or not by the credit provider) by publishing a notice in accordance with subsection (8) not later than the date the change takes effect.
Notification of other interest changes
(4) A credit provider must, not later than 20 days before a change in the manner in which interest is calculated or applied under a credit contract (including a change in or abolition of any interest free period under the contract) takes effect, give to the debtor written notice setting out:
(a) particulars of the change; and
(b) any information required by the regulations.
Criminal penalty: 100 penalty units.
Interest rate reductions
(5) Subsections (1) and (4) do not apply to a change that reduces the obligations of the debtor under the credit contract.
Strict liability offences
(6) Subsections (1), (2) and (4) are offences of strict liability.
Note: For strict liability, see section 6.1 of the Criminal Code.
Application
(7) This section applies whether or not the change is a change to the terms of the contract.
Publishing notices
(8) A notice under subsection (1) or (3) is published in accordance with this subsection if it is published:
(a) unless paragraph (b) of this subsection applies—in a manner that results in the notice being accessible to the debtor and reasonably prominent; or
(b) if a determination in force under subsection (9) specifies one or manners in which such a notice may be published—in a manner so specified.
(9) For the purposes of paragraph (8)(b), ASIC may, by legislative instrument, make a determination specifying one or more manners in which a notice under subsection (1) or (3) may be published.
(10) A manner of publication may be specified in the determination only if ASIC considers that the manner of publication would result in such a notice being accessible to the debtor and reasonably prominent.
65 Repayment changes
Notification of repayment changes
(1) A credit provider must, not later than 20 days before a change in the amount or frequency or time for payment of, or a change in the method of calculation of, instalments or minimum repayments, under a credit contract takes effect, give to the debtor written notice setting out:
(a) particulars of the change; and
(b) any information required by the regulations.
Criminal penalty: 100 penalty units.
Repayment reductions
(2) Subsection (1) does not apply to a change that reduces the obligations of the debtor, or extends the time for payment, under the credit contract. The credit provider must, however, give particulars of any such change before or when the next statement of account is sent to the debtor after the change takes effect.
Criminal penalty: 100 penalty units.
(3) If the amount or frequency or time for payment of instalments or minimum repayments is not specified in the credit contract but is determined by a method of calculation so specified, this section requires the credit provider to give particulars only of any change in that method of calculation.
Strict liability offences
(4) Subsections (1) and (2) are offences of strict liability.
Note: For strict liability, see section 6.1 of the Criminal Code.
Application
(5) This section does not apply to a change that occurs while the credit contract does not require any repayment of the amount of credit provided.
(6) This section applies whether or not the change is a change to the terms of the contract.
66 Credit fees and charges changes
Notification of credit fees and charges changes
(1) A credit provider must, not later than 20 days before a change in the amount of a credit fee or charge (including a new credit fee or charge), or a change in the frequency or time for payment of a credit fee or charge, under a credit contract takes effect, give to the debtor written notice setting out:
(a) particulars of the change; and
(b) any information required by the regulations.
Criminal penalty: 100 penalty units.
Notification by publication
(2) Notice relating to a change in the amount of a credit fee or charge (including a new credit fee or charge) may be given by publishing the notice in accordance with subsection (6). A credit provider that gives notice in accordance with this subsection must give particulars of the change before or when the next statement of account is sent to the debtor after the change takes effect.
Criminal penalty: 100 penalty units.
Credit fee or charge reductions
(3) Subsection (1) does not apply to a change that reduces the obligations of the debtor, or extends the time for payment, under the credit contract. The credit provider must, however, give particulars of any such change before or when the next statement of account is sent to the debtor after the change takes effect.
Criminal penalty: 100 penalty units.
Strict liability offences
(4) Subsections (1), (2) and (3) are offences of strict liability.
Note: For strict liability, see section 6.1 of the Criminal Code.
Application
(5) This section applies whether or not the change is a change to the terms of the contract.
Publishing notices
(6) A notice under subsection (2) is published in accordance with this subsection if it is published:
(a) unless paragraph (b) of this subsection applies—in a manner that results in the notice being accessible to the debtor and reasonably prominent; or
(b) if a determination under subsection (7) is in force—in a manner specified in the determination.
(7) For the purposes of paragraph (6)(b), ASIC may, by legislative instrument, make a determination specifying one or more manners in which a notice under subsection (2) may be published.
(8) A manner of publication may be specified in the determination only if ASIC considers that the manner of publication would result in such a notice being accessible to the debtor and reasonably prominent.
67 Changes to credit limits etc. under continuing credit contracts
Changes merely because financial hardship information exists
(1A) A provision of a continuing credit contract has no effect to the extent that a credit provider purports to rely on the provision to:
(a) refuse to provide any further credit to the debtor; or
(b) reduce the debtor’s credit limit;
merely because financial hardship information (within the meaning of the Privacy Act 1988) about the debtor exists.
Credit contracts continue for any credit previously provided
(1) If a credit provider decides not to provide any further credit under a continuing credit contract, the credit contract continues in force in relation to any credit previously provided under the contract. However, this subsection does not prevent the termination of the contract if otherwise permitted by this Code or the contract.
Giving notice of decision not to provide further credit or of decision to reduce credit limit
(2) A credit provider must, unless the debtor is in default under the contract, as soon as practicable after deciding not to provide any further credit or to reduce the credit limit, give to the debtor a written notice to that effect if such notice has not previously been given.
Criminal penalty: 100 penalty units.
(3) Subsection (2) is an offence of strict liability.
Note: For strict liability, see section 6.1 of the Criminal Code.
Credit limits may only be increased at request or with consent
(4) A credit provider may increase the credit limit under a continuing credit contract only at the request of the debtor or with the written consent of the debtor.
67AA Increasing credit limits under low cost credit contracts
A credit provider may increase the credit limit under a low cost credit contract only at the request of the debtor or with the written consent of the debtor.
Note: For low cost credit contracts that are continuing credit contracts, subsection 67(4) has the same effect as this section.
67A Changes to tenancy protection in credit contracts for reverse mortgages
A purported change to a credit contract for a reverse mortgage that makes provision for a person other than the debtor to occupy the reverse mortgaged property is void so far as the change purports to:
(a) remove a provision required by subsection 17(15A) to be contained in the contract document; or
(b) vary the contract so as to limit:
(i) the ability of the debtor to nominate to the credit provider a person who is to be allowed to occupy the reverse mortgaged property (whether alone or with other persons); or
(ii) the rights of a person nominated by the debtor to the credit provider to occupy the property.
68 Other unilateral changes by credit provider
(1) A credit provider must not exercise a power under a credit contract, mortgage or guarantee to unilaterally change its terms without giving to the other party, not less than 20 days before the change takes effect, written notice setting out:
(a) particulars of the change in the terms of the credit contract, mortgage or guarantee; and
(b) any information required by the regulations.
Criminal penalty: 100 penalty units.
(2) Subsection (1) does not apply to a change that reduces the obligations of the debtor, or extends the time for payment, under the credit contract. The credit provider must, however, give particulars of any such change before or when the next statement of account is sent to the debtor after the change takes effect.
Criminal penalty: 100 penalty units.
(3) Subsections (1) and (2) are offences of strict liability.
Note: For strict liability, see section 6.1 of the Criminal Code.
(4) This section does not apply to a change of which notice is required to be given under section 64, 65, 66 or 67 (or which would be required to be so given but for an exception provided in any such section) or which is referred to in subsection 67(4) or section 67AA.
69 Particulars of matters as changed only required to be given under this Division in certain cases
The credit provider may, under section 64, 65, 66 or 68, give a person particulars only of a matter as changed instead of particulars of the change, but only if the credit provider:
(a) makes it clear to the person that the matter has changed; or
(b) issues to the person a new set of terms and conditions relating to the credit contract, mortgage or guarantee.
70 Prohibited increases in liabilities
(1) If the annual percentage rate under a credit contract is currently fixed for a specified term (including the whole term) of the contract, the contract cannot be changed unilaterally by a credit provider so as to increase, or change the method of calculation of a fee or charge so as to increase, a fee or charge:
(a) payable by the debtor on early termination of the credit contract; or
(b) payable on prepayment of an amount under the credit contract.
(2) The regulations may prescribe circumstances in which such a change is permitted.
Division 2—Changes by agreement of parties
71 Changes by agreement
(1) If the parties under an existing credit contract, mortgage or guarantee agree to change its terms, the credit provider must, not later than 30 days after the date of the agreement, give to the other party under the agreement a written notice setting out:
(a) particulars of the change in the terms of the credit contract, mortgage or guarantee; and
(b) any information required by the regulations.
Criminal penalty: 100 penalty units.
(2) Subsection (1) does not apply to a change which defers or otherwise reduces the obligations of the debtor for a period not exceeding 90 days or to an agreement to increase the amount of credit under a credit contract.
(3) If the parties under a credit contract (other than a continuing credit contract) propose to increase the amount of credit under the contract by agreement, the credit provider must also, before the agreement is made, give to the debtor a written notice containing the information required by the regulations.
Criminal penalty: 100 penalty units.
(4) This section does not apply to a change made under Division 3.
(5) The credit provider may, under subsection (1), give a person particulars only of a matter as changed instead of particulars of the change, but only if the credit provider:
(a) makes it clear to the person that the matter has changed; or
(b) issues to the person a new set of terms and conditions relating to the credit contract, mortgage or guarantee.
(6) Subsections (1) and (3) are offences of strict liability.
Note: For strict liability, see section 6.1 of the Criminal Code.
Division 3—Changes on grounds of hardship and unjust transactions
72 Changes on grounds of hardship
Hardship notice
(1) If a debtor considers that he or she is or will be unable to meet his or her obligations under a credit contract, the debtor may give the credit provider notice (a hardship notice), orally or in writing, of the debtor’s inability to meet the obligations.
Note: If the debtor gives the credit provider a hardship notice, there may be requirements (beyond those in section 88) that the credit provider must comply with before beginning enforcement proceedings—see section 89A.
Further information
(2) Within 21 days after the day of receiving the debtor’s hardship notice, the credit provider may give the debtor notice, orally or in writing, requiring the debtor to give the credit provider specified information within 21 days of the date of the notice stated in the notice. The information specified must be relevant to deciding:
(a) whether the debtor is or will be unable to meet the debtor’s obligations under the contract; or
(b) how to change the contract if the debtor is or will be unable to meet those obligations.
(3) The debtor must comply with the requirement.
Note: The credit provider need not agree to change the credit contract, especially if the credit provider:
(a) does not believe there is a reasonable cause (such as family violence, illness or unemployment) for the debtor’s inability to meet his or her obligations; or
(b) reasonably believes the debtor would not be able to meet his or her obligations under the contract even if it were changed.
Notice of decision on changing credit contract
(4) The credit provider must, before the end of the period identified under subsection (5), give the debtor a notice:
(a) that is in the form (if any) prescribed by the regulations and records the fact that the credit provider and the debtor have agreed to change the credit contract; or
(b) that is in the form (if any) prescribed by the regulations and states:
(i) the credit provider and the debtor have not agreed to change the credit contract; and
(ii) the reasons why they have not agreed; and
(iii) the name and contact details of the AFCA scheme; and
(iv) the debtor’s rights under that scheme.
Civil penalty: 5,000 penalty units.
(4A) Subsection (4) does not apply if the credit provider and the debtor agree to a change to the credit contract that defers or otherwise reduces the obligations of the debtor under that contract for a period not exceeding 90 days.
(5) The credit provider must give the notice before the end of the period identified using the table.
Period for giving notice
If: The period is:
1 The credit provider does not require information under subsection (2) 21 days after the day of receiving the hardship notice
2 The credit provider requires information under subsection (2) but does not receive any information in compliance with the requirement 28 days after the stated date of the notice under subsection (2)
3 The credit provider requires information under subsection (2) and receives information in compliance with the requirement 21 days after the day of receiving the information
Regulations may prescribe shorter periods for credit contracts
(6) The regulations may provide for subsections (2), (3), (4) and (5) to have effect in relation to credit contracts prescribed by the regulations as if a particular reference in subsection (2) or (5) to a number of days were a reference to a lesser number of days prescribed by the regulations.
73 Notice of change
(1) A credit provider that enters into an agreement with the debtor to change the credit contract as a result of a hardship notice by the debtor must, not later than 30 days after the date of the agreement, give to the debtor, and any guarantor under a guarantee related to the contract, a written notice setting out:
(a) particulars of the change in the terms of the credit contract; and
(b) any information required by the regulations.
Criminal penalty: 50 penalty units.
(1A) Subsection (1) does not apply if the credit provider and the debtor agree to a change to the credit contract that defers or otherwise reduces the obligations of the debtor under that contract for a period not exceeding 90 days.
(2) The credit provider may, under subsection (1), give a person particulars only of a matter as changed instead of particulars of the change, but only if the credit provider:
(a) makes it clear to the person that the matter has changed; or