Last Updated: 9th August, 2017

Bad Credit From A Collapsed Investment

Published by Otto Dargan on February 4, 2014

Have you had your credit history damaged after investing in a managed investment scheme (MIS) that collapsed?

Many investors are in similar situations. They invested in schemes based on misleading claims and often borrowed money to fund their investments.

Investors have not always repaid the investment loans secured by the agribusiness investments, usually under instruction from their lawyers. As a result, many of these investors have had defaults placed on their credit files.

In recent years there have been a number of class actions initiated to recoup some of the investors’ losses, to write off the investment loans and to repair the investors’ credit histories.

Are there banks that will ignore my bad credit?

  • Some of our lenders can ignore credit problems associated with agribusiness collapses.
  • You can borrow up to 80% of the property value at normal interest rates.
  • You can borrow up to 90% of the property value with a specialist lender.
  • Evidence of any legal action will be required.

We have obtained special exceptions to normal bank criteria for investors who have unpaid defaults on their credit file .

Please call our mortgage brokers on 1300 889 743 or enquire online and they’ll contact you to discuss your options.

What types of bad credit are the result of MIS?

Most of the agribusiness managed investment schemes (MIS) were funded using a loan that was secured by the investment itself. In other words, the investor’s home or investment properties were not normally used as security.

When the loan was not repaid the lender normally lodged a default with Veda Advantage on the credit file of the investor for the full amount of the loan. In some cases the lender has taken legal action against the borrower and has sought a judgment.

In other cases, investors are still paying the debts associated with the MIS yet are in arrears because they are not receiving any income from their investment.

Which investments are covered by this exception?

Some class actions are well known by some of our lenders which means that any defaults associated with them will be ignored.

This includes defaults and other bad credit histories associated with:

  • Great Southern Group
  • Diversified Olives Project
  • Great Southern Finance
  • ABL Nominees
  • Bendigo & Adelaide Bank (for loans associated with agribusiness)
  • Brooklyn Park Organic Olive Groves Bonni-Foi
  • Australian Capital Reserve (ACR)
  • Sandhurst Trustees
  • Fincorp Investments
  • Opes Prime
  • ANZ Bank (for loans associated with Opes Prime or Storm Financial)
  • Merrill Lynch (for loans associated with Opes Prime)
  • Storm Financial
  • Bank of Queensland (for loans associated with Storm Financial)
  • CBA (for loans associated with Storm Financial)

Call us on 1300 889 743 or enquire online and one of our mortgage brokers will let you know which banks can consider your application.

What if my MIS is not recognised by the banks?

If your agribusiness investment or MIS collapse is not listed above then please contact us to discuss your situation.

You will need to provide evidence that:

  • There was a scheme that collapsed, went into liquidation or voluntary administration.
  • The collapse was no fault of your own.
  • You suffered financial hardship and were unable to pay your investment loan.
  • Or you were able to pay your debts, however chose not to based on the advice of your lawyer.

Can I refinance my investment debts into my home loan?

Yes, this is possible depending on your repayment history and the status of any legal action against the lender.

You should discuss this with your lawyer before you proceed with refinancing the investment loan.

Apply for a home loan

We know which lenders can take a common sense approach to assessing your loan application.

To talk to one of our mortgage brokers about your finance options call us on 1300 889 743 or enquire online.