National Consumer Credit Protection Act 2009

An acceleration clause is to operate only if the debtor or mortgagor is in default under the credit contract or mortgage and:

the credit provider has given to the debtor and any guarantor, or to the mortgagor, a default notice under section 88; and

the default notice contains an additional statement of the manner in which the liabilities of the debtor or mortgagor under the contract or mortgage would be affected by the operation of the acceleration clause and also of the amount required to pay out the contract (as accelerated); and

the default has not been remedied within the period specified in the default notice (unless the credit provider reasonably believes that the default is not capable of being remedied).

However, a credit provider is not required to give a default notice under section 88 or to wait until the period specified in the default notice has elapsed before bringing an acceleration clause into operation, if:

the credit provider reasonably believes that it was induced by fraud on the part of the debtor or mortgagor to enter into the contract or mortgage; or

the credit provider has made reasonable attempts to locate the debtor or mortgagor but without success; or

the court authorises the credit provider not to do so; or

the credit provider reasonably believes that the debtor or mortgagor has removed or disposed of mortgaged goods under a mortgage related to the credit contract or the mortgage concerned, or intends to remove or dispose of mortgaged goods, without the credit provider’s permission or that urgent action is necessary to protect the goods.

This section is in addition to any provision of any other law relating to the enforcement of real property mortgages and does not prevent the issue of notices to defaulting mortgagors under other legislation.