HSBC Cheated On Me!!!!! Need Help!!!

[steveadl]

I may not be following this correctly, but if you have an unencumbered title available - why don't you just draw down say a $100k LOC against this and put it into the other properties loan to bring the LVR back down?

Your overall debt hasn't changed and you haven't been forced to cross collateralise the other property. Once the situation reverses in the future, you can take that $100k back out again and get back your title from the $100k LOC you took out?

 

[boomtown]

I was a bit vague but I think thats what he has done - his margin account is in effect an offset account in $HKG against a $HKG mortgage (which has been converted into a loan of AUD).

Maybe the answer to all this hoop jumping is to get an unsecured $HKG loan for $300k AUD equivalent. Then you will never get a margin call. The only question is who lends $300k unsecured and at what rate...

 

[redsquash]

So what you're sayng is that a business which you willingly entered into a contract with - without reading the contract, mind - should just 'shut up and wait for property prices to rise' instead of looking after their own interests and do the exact thing which is very clearly stipulated in the contract which you signed without reading?

Are you serious?

Mark

exactly.once you sign on the dotted line the its the end of the story

 

[Ajax]

Have a read of these cases...whilst not completely on point you might find some comment relevant to your current situation. As Sunfish posted earlier these were some of the 1980's and 1990's cases where bank clients successfully sued the banks for not mentioning or properly explaining the exchange rate risk. I'm sure HSBC would have covered this aspect of the contract very carefully including suggesting you obtain independent legal advice regarding exchange rate risk. At least you can see what potential causes of action could be there under Trade Practices Act or in equity.

http://www.austlii.edu.au/cgi-bin/s.../347.html?query=foreign and currency and loan

http://www.austlii.edu.au/cgi-bin/s...1/26.html?query=foreign and currency and loan

http://www.austlii.edu.au/cgi-bin/s.../557.html?query=foreign and currency and loan

http://www.austlii.edu.au/cgi-bin/s.../266.html?query=foreign and currency and loan

http://www.austlii.edu.au/cgi-bin/s.../316.html?query=foreign and currency and loan

 

[Sheryn]

I finally read the docs and it says the bank has the right to request for additional security within 5 days if the loan is above the approved LVR of the property.

Always read your contract - even when you don't understand it- is the lesson here!

The relationship manager was nice but vague about my situation.

Maybe the relationship Manager didn't understand the risks especially if vague?

I hope my personal experience has highlighted the risks of taking out a foreign currency loan and I am very lucky to come out of this okay.

Thanks for sharing your situation - so we can all learn.

IMHO - Banks are trying to eliminate risk in these volatile times becuase they don't know how much subprime risk they have!


Regards
Sheryn