I am trying to fix my interest rate (at the rate pre all these latest increases) and the bank sent me out the loan document with the rate 1% less than it should have been. I signed the document off and sent it back. To me, that is a written offer and I have signed and accepted that offer. The bank has detected this "error" and tell me I have to sign a new document (mind you the new set of documents they sent out are STILL incorrect, this time in their favour - useless!). Can someone tell me if what I have signed is a legally binding contract and does the bank have to honour the low interest rate? My argument was that if the interest rate was in their favor and I signed it, they would tell me it was my fault for not reading it properly but they tell me that neither the customer or the bank can benefit from a typo. Can someone tell me if the bank is obliged to honour the low rate and is it worth me taking to the ombudsman?
Bank Loan - Error in Document
- Thread starter Leikela
- Start date
I would definitely try to force them to honour their document.
When I fixed our loans recently, my broker was sitting next to me. He has authority to talk to the bank about our loans and when the chap on the line gave me the rate at 5.22% I told him that we had been given a rate earlier of 5.02%. He honoured the 5.02% and I think the broker said it should have been 5.12%. They have done the fix at 5.02%.
I might have some of that wrong, but that is as I remember the calls. The original documents that were sent were wrong, and so there were several calls, all with our broker sitting next to me, and each time I ended up handing the phone over to him to rectify bank errors and/or incorrectly input loan types. They tried to tell me I could not fix one loan because it had (from the very start of the loan) been input into the system with the wrong account type.
Several times I handed the phone to him. Thank goodness I have a good broker, because he went into bat for us and got things sorted, when there is no way the bank was going to listen to "little old me". They had the account type input incorrectly from the time one loan was funded. Luckily our broker had the original documents in front of him, and could prove that the information obviously had been input into the system incorrectly, so we got our way (but it took several calls plus went up the line to the next person, and the next etc).
I don't really know if we got more of a discount through someone's error, but that is what seems to have happened. Either way, it was a bit of a dog's breakfast, and luckily our broker is ex-staff for this bank, so knew things backwards, and knew considerably more about the systems and errors that had obviously been made than the staffer on the end of the phone.
I'd at least try to make them honour it. It is worth a try. At only 1%, they can afford it
.
When I fixed our loans recently, my broker was sitting next to me. He has authority to talk to the bank about our loans and when the chap on the line gave me the rate at 5.22% I told him that we had been given a rate earlier of 5.02%. He honoured the 5.02% and I think the broker said it should have been 5.12%. They have done the fix at 5.02%.
I might have some of that wrong, but that is as I remember the calls. The original documents that were sent were wrong, and so there were several calls, all with our broker sitting next to me, and each time I ended up handing the phone over to him to rectify bank errors and/or incorrectly input loan types. They tried to tell me I could not fix one loan because it had (from the very start of the loan) been input into the system with the wrong account type.
Several times I handed the phone to him. Thank goodness I have a good broker, because he went into bat for us and got things sorted, when there is no way the bank was going to listen to "little old me". They had the account type input incorrectly from the time one loan was funded. Luckily our broker had the original documents in front of him, and could prove that the information obviously had been input into the system incorrectly, so we got our way (but it took several calls plus went up the line to the next person, and the next etc).
I don't really know if we got more of a discount through someone's error, but that is what seems to have happened. Either way, it was a bit of a dog's breakfast, and luckily our broker is ex-staff for this bank, so knew things backwards, and knew considerably more about the systems and errors that had obviously been made than the staffer on the end of the phone.
I'd at least try to make them honour it. It is worth a try. At only 1%, they can afford it
.
i am not sure but usually bank documents have a section that has to be signed by a "bank authority" person. the section is never signed until the docs are returned to the bank.
if like any other legal document, it isn't valid until both parties sign the "contract" so i suspect this may be the case.
if like any other legal document, it isn't valid until both parties sign the "contract" so i suspect this may be the case.
It is a Letter of Variation "Your Loan Contract (or your Loan Contract as amended)...". It states all the new rates and fees etc. and then it is signed off by the bank. Then there is the Acceptance Form which only has a provision for me to sign to say that I am accepting it.
I did speak to the bank last week and someone in the mortgage department admitted it was legally binding, but now they are trying to get out of it. I've spoken to a few people and they seem to think that they are bound by it, but I don't know how I go about taking on a bank and forcing them to do so. I was just wondering if there was a definitive answer before I think about how I'm going to tackle this.
Thanks for your assistance.
I did speak to the bank last week and someone in the mortgage department admitted it was legally binding, but now they are trying to get out of it. I've spoken to a few people and they seem to think that they are bound by it, but I don't know how I go about taking on a bank and forcing them to do so. I was just wondering if there was a definitive answer before I think about how I'm going to tackle this.
Thanks for your assistance.
It sure does, Wylie! We had some 'issues' with a building society a number years back - I wrote a very detailed letter outlining our complaints and requesting compensation ..... and they couldn't send me a cheque quickly enough!!!
A few weeks later, we discovered why - anyone remember Pyramid Building Society and the devastation it caused in Geelong and the wider community???
The only thing I would have done differently, with hindsight, is double the amount of compensation I requested. (Just joking!)Cheers
Lynn
If there is nothing in the contract that requires them to countersign your acceptance then it is a legally binding document, but remember, it all comes down to how you enforce your position.
Whatever you do, speak with the bank and ask them questions in a form of negative averment and do it in writing, do not negotiate with them over the phone. They record the conversations for 'training' and you may say something inadveratantly that gives them an opportunity to escpae their position. Negative averment questions, Something along the lines of as an example.
Are you (bank or whoeveryour dealing with) saying to me that my acceptance of your offer at xxxxx% is not legally binding.
Are you saying that I am wrong at law in understanding that this signed contract for the amount of xxxx% is legally binding upon you(bank).
Ask them the questions and let them tell you your wrong. Do the letter writing and make sure you send it by registered post etc to show that somoneone received the letter at their end.
Whatever you do, speak with the bank and ask them questions in a form of negative averment and do it in writing, do not negotiate with them over the phone. They record the conversations for 'training' and you may say something inadveratantly that gives them an opportunity to escpae their position. Negative averment questions, Something along the lines of as an example.
Are you (bank or whoeveryour dealing with) saying to me that my acceptance of your offer at xxxxx% is not legally binding.
Are you saying that I am wrong at law in understanding that this signed contract for the amount of xxxx% is legally binding upon you(bank).
Ask them the questions and let them tell you your wrong. Do the letter writing and make sure you send it by registered post etc to show that somoneone received the letter at their end.
Oh it definately got there in the required time. I rang days before the due date to ensure they got it and got the name of the person I spoke too, so they aren't disputing that they received it. Am still in battle with Westpac over this. They are refusing to budge, so have taken it to the ombudsman. Will take as late as September for a response, so am returning the new documents to Westpac which they wanted me sign, with a big fat CONDITION attached to it as advised by my solicitor (is great knowing people who know!), that if the ombudsman come back in my favor then the original contract will over-ride the new one.
They are refusing to budge, so have taken it to the ombudsman. Will take as late as September for a response, so am returning the new documents to Westpac which they wanted me sign, with a big fat CONDITION attached to it as advised by my solicitor (is great knowing people who know!), that if the ombudsman come back in my favor then the original contract will over-ride the new one. 
Two parties negotiate a contract on agreed terms. One party makes an error in the formalisation of that agreement and the other knowingly and with forethought seeks to enforce terms other than those agreed.
Swap "interest rate" for "sale price of your property" and I wonder what your view of the ethics would be.
I take it you're the sort of person who gets an extra ten bucks in change and doesn't give it back?
The banks have no ethics, which is why my ethics aren't a consideration. If I was borrowing from the little old lady down the road and she made a mistake of course I wouldn't enforce it! Same with the shop scenario, if it's an independant shop and they gave me wrong change I would tell them. If it was Coles or Target or somewhere I'd take it and run.
The banks have no ethics, which is why my ethics aren't a consideration. If I was borrowing from the little old lady down the road and she made a mistake of course I wouldn't enforce it! Same with the shop scenario, if it's an independant shop and they gave me wrong change I would tell them. If it was Coles or Target or somewhere I'd take it and run.
So your honesty is inversely correlated to the size of the organisation you're dealing with.
Interesting approach.
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Yes, because the bigger the organisation, the lower their ethics and standards. What leads to so many mistakes in big organisations? Staff under pressure because they keep cutting staff to keep making record profits each year. So if they stuff up in my favor, I will run with it. If staff shortages cause too many problems which turn out to be costly, then perhaps they will put more staff back on. Plus, how much time do I waste on the telephone and in queues in these big organisations?! My time is just as valuable as theirs, so if they want to give me extra $$ I will run with it!
Plus, how much time do I waste on the telephone and in queues in these big organisations?! My time is just as valuable as theirs, so if they want to give me extra $$ I will run with it!
Typical pot calling the kettle black and double standards that it seems many people seem to have.
Fortunately most of those that I know or have come across are'nt very successful. It seems that this type of negative attitude just keeps boomeranging back at them.
Lekeila you need to ask yourself why anybody would ever want to do business with you and place any trust in you.
I certainly would'nt, the bank does because they are so large and don't have the time to micromanage such things.
And in case you still did'nt get it:
"Two wrongs don't make a right"
Fortunately most of those that I know or have come across are'nt very successful. It seems that this type of negative attitude just keeps boomeranging back at them.
Lekeila you need to ask yourself why anybody would ever want to do business with you and place any trust in you.
I certainly would'nt, the bank does because they are so large and don't have the time to micromanage such things.
And in case you still did'nt get it:
"Two wrongs don't make a right"
Well, fortunately I'm not like one of those unsuccessful people you know. My friends and clients love me! I'm very helpful and trustworthy towards them. I just dislike major organisations sh**ing all over everyone to keep increasing their bottom line each year, while customer service keeps decreasing. So if there's an opportunity there, I will take it! I'll fight the bank all the way, if I win great... if I lose, I've lost nothing. And by the way, I'm a big believer in an eye for an eye and capital punishment etc. so 2 wrongs may not make a right, but it sure as hell makes you feel better!
I'm very helpful and trustworthy towards them. I just dislike major organisations sh**ing all over everyone to keep increasing their bottom line each year, while customer service keeps decreasing. So if there's an opportunity there, I will take it! I'll fight the bank all the way, if I win great... if I lose, I've lost nothing. And by the way, I'm a big believer in an eye for an eye and capital punishment etc. so 2 wrongs may not make a right, but it sure as hell makes you feel better! Ethics ain't what they used to be.
Let's see how the same approach reads with some minor adjustments
Let's see how the same approach reads with some minor adjustments
Some Tenant said:Well, fortunately I'm not like one of those unsuccessful people you know. My friends and clients love me!
If the landlord is unreasonable, letting the property get run down, slow repairs and increased rents then I say good on the tenant for taking what they can get. I'm a reasonable person, and although I'm new at this property investing (have had a couple of PPOR, but have just bought my first investment property), I know I'll be a good and fair landlord and won't be one of these ars*hole money grabbing ones thinking only of their bottom line without any consideration for their tenants. Unfortunately it's just the way of the world now, you have to watch your back or someone will walk all over you. And that's exactly what these big organisations are doing. Sacking employees, decreasing customer service etc. to keep increasing profits.
Unfortunately it's just the way of the world now, you have to watch your back or someone will walk all over you. And that's exactly what these big organisations are doing. Sacking employees, decreasing customer service etc. to keep increasing profits.the bank is an organisation and has no ethics, Your loan can be sailing along fine one day and when they decide the need to decrease risk, they decide not to renew your loan even though you'e done everything right. I have met people who have had the rug pulled from under them becasue of other stuff ups by the bank and to reduce their overall loan exposure thye go along and call in loans that are performing.
Don't for one minute think the banks won't do you an injustice if it suits their position.
Don't for one minute think the banks won't do you an injustice if it suits their position.
