When the Parliamentary Joint Committee on Corporations and Financial Services hands down the report of its inquiry into the consumer credit bill on Thursday, the industry will focus its attention on recommendations relating to controversial payday lending provisions.Debate over the Government's plan to set caps on what short-term lenders can charge, along with other restrictions, has had a thorough going-over. But a sleeper issue in the Consumer Credit and Corporations Legislation Amendment (Enhancements) Bill 2011 is a provision that would remove the loan limit for borrowers making a hardship claim. Under the current law a debtor has the right to make a hardship application where the amount of credit provided is less than A$500,000. Under the amendment it is proposed that all debtors have a statutory right to make a hardship application, regardless of the amount of credit that is provided under their contract.In its submission to the committee, the Mortgage and Finance Association of Australia said: "We think the proposal to remove the $500,000 cap is too wide, as it could result in borrowers of any amount making a hardship application. "The cap should only be removed when the loan is secured by the borrower's principal place of residence. It is important that lenders have commercial certainty on larger investment loans unencumbered by a vehicle to delay lenders enforcing their legal rights.Aussie Home Loans expressed a similar concern in its submission: "Our concern is that the removal of the cap applies to loans secured by residential investment properties."The removal of the cap is only one change to the operation of the hardship provisions. The Government's view is that the current statutory procedures inhibit the capacity of debtors to apply for a variation to their credit contract. A credit provider is able to commence enforcement action even while the consumer is waiting for a reply to his or her hardship variation request. The amendment requires credit providers to respond to an outstanding application for a hardship variation before commencing enforcement proceedings.The amendment makes it easier for debtors to apply for hardship variations by making the procedures more flexible. Under the current law an application for a hardship variation must seek to change the contract in ways stipulated by the National Credit Code. Under the new law there are no limits to the form of hardship variation that can be requested. And it introduces a remedy of unfair or dishonest conduct by credit service providers.