Overdraft to Personal Loan Change

[aarondwyer]

Hi all

I'm after some advice / options please.

My inlaws had a 16,000 overdraft secured by a rural piece of land worth about that amount.

They were paying $200/mnth to cover the interest component of the loan (arrangment with the bank I believe).

Suncorp-Metway have just converted this over to a personal loan and expect $200/week now or full payment.

They didn't get any authority from my in-laws to do this. Is that normal practice???

The inlaws can't meet the change in payment to that degree and don't know what to do.

If they let the bank take the land are they then declared bankrupt.?? They have other debts that are just in a holding pattern as well.

The bank is not willing to negotiate on the repayments.

My advice would be refinancing completely but I just don't know in this arena to be confident with a response that could make or break them.

Does anyone have any comments for me, please.

Regards
Aaron

 

[Kevmeister]

They might wish to contact the Banking Ombudsman for advice. I would probably also tell Suncorp Metway that are going to speak to the Banking Ombudsman, because banks seem to really hate that happening, and may back away, especially if they don't have a leg to stand on.

 

[Rolf Latham]

Hiya Aaron

You might find that the loan was specifically written that way.


Most land only type loans are interest only for max 1 to 3 years, and then they want you to either build or pay the place down.

Dont under any circimstances let the bank "take" the land and sell it. If it comes to that they should do it themselves to shield their CRAA as much as possible.

Foreclosure is not a nice thing for your credit history.

On the positive side they could refinance ?

Ta

Rolf