A 66- year-old man who claimed discrimination after being declined for a home loan refinance has had his case thrown out.
Giulian Ashton Lomax took the National Australia Bank to the human rights division of the Victorian Civil and Administrative Tribunal claiming NAB engaged in ageism.
NAB cancelled credit secured by a mortgage over a property owned by the applicant and rejected further finance proposals after Lomax fell into financial difficulty and stopped paying interest repayments.
Lomax, who represented himself, relied on articles referring to older borrowers being the victims of ageism and discrimination and suggested that older borrowers were being constrained by the NCCP Act, amidst concerns about how older borrowers can meet the responsible lending guidelines.
Anna Dea, Tribunal member, dismissed proceedings noting that it is reasonable for a lender such as NAB to have regard to a prospective borrower’s capacity to repay.
Gadens Lawyer’s 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 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’ 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.”