What Happens when I Suspend My Direct Debit Authority?
Consumer protection agencies in Australia have ruled that requiring a direct debit authority cannot be mandatory. Lenders encourage automatic digital payments because it takes one thing off a homeowner’s plate. Homeowners have the right to suspend direct debit authority for mortgage payments.
Mortgage lenders and home loan providers encourage their clients to set up automatic payments for several reasons. Since they’re automated, homeowners don’t need to worry getting the timing and amount wrong, triggering avoidable embarrassment, dishonour fees & in some cases penalty interest. Then you have to ensure that you send it ahead of the due date so it’s applied on time. Thanks to online banking, automated payments are more mainstream. Some homeowners prefer a different payment method.
Other reasons contribute to the suspension of a direct payment authority. For example, you might close the account and open a new one. Lenders cannot mandate one payment form over another. However, it’s up to you to communicate your preferred payment method with the lender.
Open communication with the lender builds a strong relationship. This is a worthwhile relationship that comes in handy when you need a top-up loan, bridge loan, or car loan.
Suspend Direct Debit Authority Conclusion
Homeowners can suspend direct debit authority for their mortgage without repercussions. Since mortgages are large amounts of debts, lenders simply try to ensure that payments aren’t missed because the homeowner forgot to send them. They even do this for the car loan. Once you suspend your electronic authority, it’s up to you to institute a system that ensures on-time repayments. For more information, contact Mortgage House.