Homeowners bring class-action lawsuit against 'big-four' SA banks
As such, the record-breaking class-action lawsuit is set to be heard in February 2026. And it's said to be made up of residents who fell on hard times. They couldn't meet their mortgage payments, and had their homes repossessed by the banks. Who then sold them as distressed properties on auction. Buying a distress property on auction is a great way to get a good deal. Image: File
Unsurprisingly, the potentially biggest class-action lawsuit ever in South Africa, could prove a turning point for the bank industry, reports IOL . If awarded, it will dwarf the previous successful class-action lawsuit in the country. This was awarded back in 2012, for R5 billion, to miners who contracted silicosis and tuberculosis.
So, what exactly are the former homeowners arguing against South Africa's banks? And what's the likelihood of this record-breaking settlement actually being awarded in court? Such unscrupulous behaviour often targeted the poorest black households a decade ago. Image: Writer's room
As such, applicants in the class-action lawsuit are fighting that their homes were undervalued when sold at auction. They were often sold with no reserve price, no regard for market value and for as little as R1 000. Apparently, this was possible before 2017, when South African courts didn't require a minimum sale price. Such a practice was also only prevalent in South Africa at the time, and nowhere else.
Mercifcully, the loophole has since been closed. However, more than 100 000 former homeowners did suffer, and they wish to set the record straight in court. And they've got the Lungelo Lethu Human Rights Foundation taking up the fight for them. With one advocate Dr. Douglas Shaw leading arguments. The case is expected to be heard in February 2026. Image: Pexels
Talking on The Money Show, Dr. Shaw said he's pushing for criminal investigations into each sale. 'When I go to court, I go up against tens of people. It's me versus all those from the top banks in the country. It's a scary thing to do. Most lawyers would say, no, it's too difficult. But this class-action lawsuit needs to be heard,' said Shaw.
If your house was repossessed and sold as 'distressed' before 2017, you can add your name to the growing class-action lawsuit here. Simply email – banksoldmyhouse@drdouglasjshaw.co.za for more information. We'll bring you more on this story as it develops into 2026 …
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