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Unconscionable lending leaves Jim* in the lurch

Jim* is illiterate and has a serious brain injury. His sole income is a disability support pension.

Jim approached a financial services provider and they lent him money to buy a house although they were aware of his vulnerability. The provider took no additional steps to ensure he understood the contract or received independent legal advice.

The home was significantly overvalued by the financial provider and the loan represented approximately 90% of the value of the property. After struggling to keep up with the mortgage payments, Jim finally fell into arrears. The financial institution repossessed the house and sold it at a loss, leaving Jim with a $25,000 shortfall.

Suncoast Community Legal Service had some robust discussions with the financial service provider but they insisted that their actions were not unconscionable. Volunteer law students from Suncoast have been assisting the clinic supervisor to prepare submissions for the Ombudsman to help Jim.

*Not real name

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