Good morning all,
This is a question for the legal experts..
I got two investment mortgages through Westpac in November 2015, both variable.
One was 4.28%, the other was 4.55%, I just logged on right now and have discovered that both loans are now 4.75%. I am aware that banks are increasing their rates for investors but can they increase them without notifying their customers first? I received nothing in the mail, no phone call, no email etc.Obviously there is little I can do but surely there has to be something that warrants notification first? Is that even legal to raise rates without notifying your customers first?
They do not need to inform you of an impending rise. Usually online banking will show updates of interest rates etc – at the very least your current rate.
Corey Batt | Precision Funding
http://www.precisionfunding.com.au
Email Me | Phone MeInvestment Focused Finance Strategist - servicing Australia-wide
Thank you for your reply Corey.
Very surprised they don’t at least notify you, if I increased the rates I charged my customers and didn’t tell them I doubt I’d have many customers left!I guess the best way to protest is to take my business elsewhere.
You’ll find all banks do this – it’s in their T&C’s within the loan contracts. Sometimes lenders will inform customers of up and down movements – but there’s limited value in their eyes in spending significant funds in mailing every single customer to tell them they’re going to start charging them more – doesn’t look great in any case.
The rate you have currently is OK but not amazing – certainly can do better. We’re moving a lot of clients at the moment to another Big 4 which will rebate $1500 to the client for refinancings + provide PPOR and investment rates <4.4% (3.99% for owner occ fixes).
Corey Batt | Precision Funding
http://www.precisionfunding.com.au
Email Me | Phone MeInvestment Focused Finance Strategist - servicing Australia-wide
Some have argued this is unconstitutional as you cannot contract where the terms of the contract are not fixed and one party can jack up rates.
Terryw | Structuring Lawyers Pty Ltd / Loan Structuring Pty Ltd
http://www.Structuring.com.au
Email MeLawyer, Mortgage Broker and Tax Advisor (Sydney based but advising Aust wide) http://www.Structuring.com.au
Thank you Terryw, I just can’t fathom not informing your customer directly of a change in rates that would affect repayments, either up or down. As investors we always plan for interest rate fluctuations on variable loans, I just thought the bank would be required by law to inform their customers of any changes pertaining to that loan. I’ve always been informed from my other banks in Canada, Japan etc.
Understood Corey, since I’m a non resident I doubt any of the remaining big four would consider me. I’m going to try my main bank HSBC as they’ve said (subject to their application) that they’d give me 4.35%. Basic customer service is such a simple thing, you’d have thought Westpac would have figured it out by now. I’ll be in touch if HSBC passes sir.
NAB do this too; the loan statement will say something like ****Interest rate from Jan 1st will rise to 4.45%**** and that is the only notice you get. Agreed it is very unfair.
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This reply was modified 8 years, 10 months ago by
Jon.
You’ve got variable rates….you should shop around.
St George will lend to expats, only condition as far as I know is max 70% LVR (though they waived it for us to go to 72.5% with our last purchase).
Thanks DeanCollins, yes, most banks will give anyone 70%, HSBC will consider 80% LVR on a case by case basis (helps if you’re an existing premier customer). I’ll see if they come back with anything first.
Hello Guys,
That’s My India anything can be possible. And increase in interest rate without inform or without warning you not any special matters.
ThanksYou’ve got variable rates….you should shop around.
St George will lend to expats, only condition as far as I know is max 70% LVR (though they waived it for us to go to 72.5% with our last purchase).St George – fully owned subsidiary of Westpac Group. :P
Just call up Westpac saying you’re looking to leave the bank if they do not sharpen their pencil – this will usually get your rate in a most competitive space if possible.
Corey Batt | Precision Funding
http://www.precisionfunding.com.au
Email Me | Phone MeInvestment Focused Finance Strategist - servicing Australia-wide
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This reply was modified 8 years, 10 months ago by
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