Kim Carr (Victoria, Australian Labor Party, Shadow Minister for Housing and Urban Development) Share this | Hansard source

I remind you, Mr Acting Deputy President, that this is the price that Australians are paying for the trust they placed in this Prime Minister when he said that this government would keep interest rates at record low levels. And this is the price they are paying for the Howard government’s failure to protect desperate homebuyers from unscrupulous mortgage brokers and loan sharks.

The reality is that the housing boom has left too many people desperate to get into the housing market, as they watch their dreams slip further and further out of reach as prices continue to rise. Too many have seen their financial position deteriorate before their eyes. After the four interest rate rises that have occurred since the last election and the promise to keep interest rates at record lows, the opportunities for tens of thousands of Australians are similarly reduced. When people see their dreams disappearing, they are vulnerable to the new breed of ruthless lenders and brokers that are now pillaging the Australian mortgage market.

I have seen estimates that suggest that up to 20 per cent of the mortgage market will be captured by these mortgage brokers, who offer no-doc housing loans to people who are unable to afford to make the payments. These people are not required to show that they actually have an income. I have seen examples in recent times of people who are on the dole being given mortgage finance. The mortgage broker does not care whether or not the loan can be repaid. People are required to sign contracts whereby the money will be extracted without any consideration for changed circumstances. I urge all senators to have a look at their email inboxes—to occasionally spend a bit of time going through the emails they are receiving every day. Everyone would have seen these brokers touting loans which are effectively without any paperwork.