Every new home loan borrower will be presented with a plain English one page fact sheet before they sign up for a mortgage loan. the fact sheet will explain all major elements of the home loan, including how much per dollar borrowed they will end up repaying, and a reference to competitors and to comparison services. The fact sheet idea – also known in the industry as a “one pager” – has already been extensively tested by governments, using a wide range of financial products.
The results were said to be fairly conclusively in favour, and Commonwealth government treasury officials, in particular, are believed to have been impressed by the ability of consumers to consistently pick the most suitable products for them when presented with simple information on a one-page sheet.
“Consumers are clearly able to select the best and cheapest products for them when they have the information presented to them in the one-pager format,” said Nicole Rich, policy director at the Consumer Law Action Centre. “It works especially well with credit cards, but was good for home loans, accounts, term deposits, even car loans.” The fact sheets must be available at the ‘shopping around’ stage, in brochures and on websites, said Rich, not at the final application sign-off.
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