A 66-year-old who claimed he could not get home loan refinancing because of his age has had his discrimination case thrown out.
Melbourne architect Giulian Ashton Lomax took National Australia Bank to the human rights division of the Victorian Civil and Administrative Tribunal, after
NAB cancelled credit secured by a mortgage over a property owned by the applicant.
NAB said further finance proposals were rejected after Lomax fell into financial difficulty and stopped paying interest repayments, but Lomax complained NAB engaged in ageism.
Lomax, who represented himself, referred to
Australian Broker articles relaying various brokers’ experiences in having difficulty in securing finance for older borrowers.
The articles referred to older borrowers being the victims of ageism and discrimination and suggested lenders were being unnecessarily constrained by the NCCP Act, amidst concerns about how older borrowers can meet the responsible lending guidelines where they do not have traditional income sources.
But Tribunal member Anna Dea dismissed the proceedings, saying it is reasonable for a lender such as NAB to have regard to a prospective borrower’s capacity to repay.
Gadens Lawyers partner Jon Denovan told
Australian Broker that while it is illegal to discriminate because of age, it is not illegal to consider age.
“You can’t ignore that someone’s 102. The law requires lenders and therefore brokers to make sure the borrower can repay without hardship. In fact, it’s compulsory that you consider the age of a person as that’s an inquiry you need to make for serviceability.”
While the case was thrown out, Denovan – whose firm represented NAB – said lenders and brokers should take note.
“The warning from the case is that brokers and lenders need to be aware that we live in a world where consumers have lots of rights and we need to be very careful as to how we say a loan is rejected for an elderly person.
“You can’t say ‘we’re not giving you a loan because of your age’ or ‘we don’t lend to older borrowers’, and you must not have a policy that says that. Instead, you have to consider each loan on its merits and in doing that you can take age into consideration."
Claims such as these can waste lenders' and brokers' money and time, Denovan said.
"But that’s the cost of doing business these days...It is a reminder that things like the Privacy Act and Anti-Discrimination Act are not toothless tigers."
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ASIC won't stop ageism: Iden
Lenders have mixed reaction to age
