Can they do this?

[LeanneS]

On the day of the last interest rate announcement (12 March) I approached my bank do a five year fixed rate interest only at 6.5%.

So they asked for some documentation which I sent straight away. A few days passed and they asked for some more, which I sent straight away. Then almost a week passed and they asked for some more, which I sent straight away. Now they're asking for proof of income as my company accounts are not sufficient (I'm self-employed).

In the meantime their rates have gone up and they're not obliged to give me the rate I asked for.

Last week I asked to have the rate I'd applied for locked in. At the time he ignored it - he says they couldn't have as they have insufficient documentation. At the time they had all the documentation they'd asked for so far.

If they'd asked for everything they needed up front I might have had a chance of getting it all to them - every time I send what they ask for they say "Oh, the computer's come up asking for this now".

So now apparently I'm not eligible for their rate but everyone else has put their rates up too so my chances of getting the same rate anywhere else are pretty slim.

I got an autoreply from my account manager which said for urgent enquiries contact so-and-so, so I've started CCing her in. Not to drop him in it, because I really don't care, just so that someone can be looking at the file and making a decision. I'm wondering if that's got his back up and now he's decided to be as difficult as he can be.

Tempted to go elsewhere, but then I've got even less chance of getting 6.5% anywhere else.

Cheers,
Leanne

[MoatMaster]

Unfortunately yes they can. Normally until the loan has been approved, they will not reserve a rate.
I do think however that they person you dealt with, who should have been fully aware of the moment in the rates, should have pointed this out to you.
Unless you are in a position (because of the value of your business) to convince someone to overturn their decision then all you can really do is react with your feet.
Unfortunately their is very little, if any discretion, available at branch level for this.

Admittedly I do not know your situation, but unless you really need the certainty of a fixed term rate, then perhaps you should think about whether locking in now is a good idea.
Although there are never any guarantees, there are certainly no indicators that the shorter term rates will be moving upwards any time soon. Bollards statements today would also support that.

[Monkeyboy]

I'd say MM is pretty much on the ball here. The money now costs the bank 6.75%, (yeah right) so the bank wont give any discretion at any level. If they haven't done anything wrong but just given you slow service then I'd say no chance.

[drelly]

I'm stunned at how poor the service is from these banks. On Thursday morning, I contacted my National Bank and BNZ personal bankers and requested a total of $800k in mortgages be fixed for 5 years. They both emailed me back confirming the rates I was requesting.

The National Bank letter has just arrived confirming a fixed rate of 7.5% - rate confirmed was 6.75%.

Cost to me: $14137

BNZ is worse! After several phone calls and emails, I have had nothing from BNZ and I've just phoned my Business Manager who is apparently away on leave. Rate confirmed was 6.69% - current rate is 7.5%.

Cost to me: $17698

Do they seriously expect me to pay an extra $32k in interest because they couldn't do the paperwork on time???

[MoatMaster]

In this case, having received confirmation by email, you have grounds to hold them to the lower rates. Unless your earlier communication was just an enquiry as to what was available, instead of a definite request to refix.

[drelly]

The National Bank guy has responded to me saying that it was an error in the lending department and it will be fixed. He has been really good every time I've dealt with him over the past 5 years. Grant Attwood at National Bank, Bank Street, Whangarei - if anyone is interested.

No one is answering at BNZ so I'm on my way down there now. Fun fun.

[k1w1]

Let us know how you get on.

[Monkeyboy]

Good luck Dave. Keep us posted.

[Aeryn]

Good luck! I hope the BNZ do the right thing by you.

A

[drelly]

Mission Accomplished! The BNZ staff not on holiday were really helpful and it sounds like the person I was dealing with had left more than a few problems for them. They honoured the terms in the email I showed them and the manager even brought me a cup of tea, which I enjoyed while we discussed Alan Bollard's latest press release. I nearly asked for a foot massage but thought that would be pushing it!

[mortgage broker]

Good thing you got everything in writing, emails are great.

[Aeryn]

Phew. Good news.

[Monkeyboy]

Good Work Dave

[Rolf]

Congratulations Dave. I fixed recently for 6.5% with National as well. It was a handful of loans and I rightfully expected it to take a while, so made sure all verbal agreements were confirmed by email - just in case... I didn't have problems though, but your experience certainly shows that it's well worth having it in writing!

[tpr2]

I'd say MM is pretty much on the ball here. The money now costs the bank 6.75%, (yeah right) so the bank wont give any discretion at any level. If they haven't done anything wrong but just given you slow service then I'd say no chance.

I'm with you Mb on that one.

What do you think the bank is really paying?