Watch out for ripper lenders!!! - Loan Australia

[MTo]

Loan Australia - www.loanaustralia.com.au

Watch out you ever thinking of getting a loan from them!

Let me share with you my story...

In mid-August I applied for a loan and paid $350 for the application fee via electronic transfer. One day later, when I rang them up, they had not received (could not detect) my payment so they did not proceed my application. As I urgently needed my financial approval, I rushed to the bank to send another $350 in cash to Loan Australia. Later that day, they told me that they had received my money and they would have my application processed within 4 working days and refund the extra $350 I sent them. On the fourth working day (the day my finance term is due), I called them up just to find out that they needed 3 more working days to finish my application. I asked my solicitor to discussed this problem with the vendor, but the vendor decided to cut the deal off. As upset as I was, I rang up Loan Australia demanding full refund (as they did not fulfill their obligations). They promised to fully refund the application fees, but it would take three months to process (I thought, WTH!).

Two weeks ago, after three months, I still had not received any response from them. I called them up and guess what they told me... "Sorry Sir, we can not refund the $350 because we did start to process your application. You will get your refund for the other $350 in about two weeks time." I tried to argue that they did promise me full refund for all $700 but they said that there is nothing they could do...

Today is almost three weeks since that last phone call and I have yet to receive that bloody cheque...

Can anyone please suggest what I should do...?

They had cost me $700, $750 for my solicitor, $$$ for my bargain, my time, my negotiating effort, my phone bills, etc etc

Lessons to all:

Always do your finance before hand or if you are in a hurry, use an experienced and hardworking finance broker (you don't want to lose a great bargain like I did!) to get assuring deals! Also, be careful and not to be deceived my lower rate charges like Loan Australia has... Their service is simply outrageous!

Forumites, please share with us any of your bad experience with lenders and don't forget to name them!

Cheers

 

[alexlee]

First lesson: always get finance approval first.

 

[yo yo ma]

They have been discussed on this post:
http://www.somersoft.com/forums/showthread.php?t=31206

Lessons Learned...
1) When you do any electronic transfer, it takes 24-48 hours to go through (even though the funds are debited from your account immediately.)
2) Back up all correspondance with an email & then you have some proof of who you spoke to
3) As you have stated, plan your finance early
4) You get what you pay for
Steve

 

[skater]

I don't know if you will get any help, but you could try the banking ombudsman.

 

[MTo]

Thanks yo yo ma & skater (sorry do not know your real names) for the link and suggestions. I just read that forum about Loan Australia and could imagine how they felt about 'that too good to be true' deals. For me, I just simply can't trust them anymore...

And skater, I am gonna send an e-mail to the banking ombudsman today. Will see how we go...

 

[yo yo ma]

I don't know if you will get any help, but you could try the banking ombudsman.

This doesn't really sound like a case for the Banking Ombudsman

What you should do before lodging your dispute
We encourage you to try to resolve your dispute with your financial service provider before lodging a dispute with us. You may have already tried to do this by discussing the matter with your branch or a particular department of the financial institution. However, it is our experience that a dispute which appears to be at deadlock may often be resolved when it is referred to the customer relations department which is responsible for dealing with customer complaints.

It is not the fault of Loan Australia that the electronic transfer didn't go through straight away & it is not the fault of LA the MTo didn't organise finance in time.

It is the fault of LA that someone gave MTo incorrect information about the fee refund & time taken to process. However, I assume MTo has no proof of these conversations? A polite email from MTo (getting things in writing) to LA should be able to recover the extra $350 he paid.
Good luck, learn from it & move on
Steve

 

[MTo]

This doesn't really sound like a case for the Banking Ombudsman It is not the fault of Loan Australia that the electronic transfer didn't go through straight away & it is not the fault of LA the MTo didn't organise finance in time.

It is the fault of LA that someone gave MTo incorrect information about the fee refund & time taken to process. However, I assume MTo has no proof of these conversations? A polite email from MTo (getting things in writing) to LA should be able to recover the extra $350 he paid.
Good luck, learn from it & move on
Steve

I did keep all the e-mails of conversation with them (even the name of their broker who promised me full refund). Trust me, I was polite all the time during our conversations...

I have let go about everything else they had cost me... All I wanted was my $700 back (personal satisfaction) and they would not even fulfill that...

Financial and Consumers Rights Council is currently looking in this matter.

 

[Simon]

Fight them.

All the good brokers I know don't ask for money up front from clients.

Don't use those ones if you can avoid them.

Cheers,

 

[yo yo ma]

I did keep all the e-mails of conversation with them (even the name of their broker who promised me full refund). Trust me, I was polite all the time during our conversations...

Well that makes a much better case for you then... Good luck with it
Steve

 

[Qlds007]

I am with Simon. If anyone asks for money up front then steer well clear and go elsewhere.

 

[grossreal]

hi all
a couple of things here.
1. most lenders are asking for a financial commitment fee when the loan goes into and its this point that alot of brokers are exploting
to hold the commitment fee.
they just take for ever and a day to give it back.
a LA say they are a lender then they are doing the same as say westpac now and even bankwest.
the trouble here is not the up front fees it that tere is no time requirement to give it back.
and if you read a post I did some time ago the commercial market is alot worse and I think some of the commercial guys are actually making a business out of collecting the upm front fees and using that to fuel there business as there in no interest paid on the fees.
your fee was $350
the commercial can be upwards of 35k and the same happens.
the market is very tight and these things happen.
it fine to climb on to the soap box and say that you should fight them but in reality in the equity court and thats where it would end up they would just say that they are going to give it back.
I have mirvac funds management that are going to give back 5k and its still in there to be returned and its comming up to 12 months this january.I have left it there as I will use it for the next mirvac deal and have not done much about it.
I only pay the lender not a broker as it has got to the stage that where9 out of ten you will not get it back.
try this one
I got a broker to pay the fee to establish the loan as he was so certain that they could do the loan.
the loan paperwork came back nothing close to what was required.
so didn't go with the loan.
he still keeps ringing telling me that the lender wont give him his 5k back.
I don't think that the market is going to change with this regard and its what I see as a huge problem for both comm and resi lending because I see the broker market is so unregulated that within 4 months you mto could be a broker and get your money back by doing the same thing. 40 dollars for a add in the news paper and away you go.
and maybe I will see you across a desk saying you represent westpac bankwest anz cba etc and want 10k to put the loan in
and that you are backed by this big mortgage group
when in reality you have just finished the coarse have no idea of what you are doing
and take the 10k and off to another sucker and no one except the equity court for recoarse.
and alot of brokers saying that it is regulated
well sorry its not and I would be taking more time tocheck out the broker then the deal in alot of cases.
but that just my view

 

[Simon]

hi all
a couple of things here.
1. most lenders are asking for a financial commitment fee when the loan goes into and its this point that alot of brokers are exploting
to hold the commitment fee.
they just take for ever and a day to give it back.
a LA say they are a lender then they are doing the same as say westpac now and even bankwest.
the trouble here is not the up front fees it that tere is no time requirement to give it back.
and if you read a post I did some time ago the commercial market is alot worse and I think some of the commercial guys are actually making a business out of collecting the upm front fees and using that to fuel there business as there in no interest paid on the fees.
your fee was $350
the commercial can be upwards of 35k and the same happens.
the market is very tight and these things happen.
it fine to climb on to the soap box and say that you should fight them but in reality in the equity court and thats where it would end up they would just say that they are going to give it back.
I have mirvac funds management that are going to give back 5k and its still in there to be returned and its comming up to 12 months this january.I have left it there as I will use it for the next mirvac deal and have not done much about it.
I only pay the lender not a broker as it has got to the stage that where9 out of ten you will not get it back.
try this one
I got a broker to pay the fee to establish the loan as he was so certain that they could do the loan.
the loan paperwork came back nothing close to what was required.
so didn't go with the loan.
he still keeps ringing telling me that the lender wont give him his 5k back.
I don't think that the market is going to change with this regard and its what I see as a huge problem for both comm and resi lending because I see the broker market is so unregulated that within 4 months you mto could be a broker and get your money back by doing the same thing. 40 dollars for a add in the news paper and away you go.
and maybe I will see you across a desk saying you represent westpac bankwest anz cba etc and want 10k to put the loan in
and that you are backed by this big mortgage group
when in reality you have just finished the coarse have no idea of what you are doing
and take the 10k and off to another sucker and no one except the equity court for recoarse.
and alot of brokers saying that it is regulated
well sorry its not and I would be taking more time tocheck out the broker then the deal in alot of cases.
but that just my view

I tried using babelfish but that didn't help either. Any ideas??

 

[Peter_Tersteeg]

It appears (if my baglefish is working) that grossreal is talking about commercial funding. Commercial funders often ask for some fees upfront as they have to do a considerable amount of work including valuations (which can be expensive) just to get an application to conditional approval.

The $350 fee MTo has a problem with is obviously a residential deal, the fee would be larger for commercial. Some residential brokers do ask for an upfront commitment fee and my advice is also to walk away from them at that point.

In mainstream residential lending, I'm not aware of any lender who requires cash up front just to start processing. The only fee I'd ever recommend paying upfront for a residential loan is a rate lock fee for fixed loans in a rising rate environment.

Grossreal I won't pay your upfront commercial costs for you, but I would fight tooth and nail for you to get them back if the deal didn't go through.

 

[yo yo ma]

I tried using babelfish but that didn't help either. Any ideas??

With Babelfish on

Hi All
A couple of things here... Most lenders are asking for a financial commitment fee, when the loan goes into and it's this point that a lot of brokers are exploting to hold the commitment fee. They just take for ever and a day to give it back. LA say they are a lender then they are doing it the same as say Westpac now, and even Bankwest.

The trouble here is not the up front fees, it that there is no time requirement to give it back. If you read a post I did some time ago, the commercial market is a lot worse and I think some of the commercial guys are actually making a business out of collecting the up front fees. They using that to fuel their business, as there in no interest paid on the fees.

Your fee was $350. The commercial can be upwards of 35k and the same happens. The market is very tight and these things happen. It fine to climb on to the soap box and say that you should fight them but in reality in the equity court (and thats where it would end up), they would just say that they are going to give it back.

I have Mirvac funds management that are going to give back 5k and it's still in there to be returned (coming up to 12 months this January.) I have left it there, as I will use it for the next Mirvac deal and have not done much about it.

I only pay the lender, not a broker, as it has got to the stage that where nine out of ten times, you will not get it back.

Try this one... I got a broker to pay the fee to establish the loan, as he was so certain that they could do the loan. The loan paperwork came back nothing close to what was required, so I didn't go with the loan. He still keeps ringing telling me that the lender wont give him his 5k back. I don't think that the market is going to change with this regard.

This is what I see as a huge problem for both commercial and residential lending because I see the broker market is so unregulated, that within 4 months you too could be a broker and get your money back by doing the same thing. 40 dollars for a ad in the newspaper and away you go. Maybe I will see you across a desk saying you represent Westpac, Bankwest, ANZ, CBA etc and want 10k to put the loan in (and that you are backed by this big mortgage group.) When, in reality, you have just finished the course and have no idea of what you are doing. You take the 10k off to another sucker and no one except the equity court for recourse.

A lot of brokers are saying that it is regulated. Well, sorry, it's not and I would be taking more time to check out the broker, then the deal in a lot of cases.

But that's just my view

 

[dantheman]

40 dollars for a add in the news paper and away you go.

This made me laugh, I wish it were so easy.

and maybe I will see you across a desk saying you represent westpac bankwest anz cba etc and want 10k to put the loan in
and that you are backed by this big mortgage group
when in reality you have just finished the coarse have no idea of what you are doing
and take the 10k and off to another sucker and no one except the equity court for recoarse.

The banks you mentioned won't deal with these "dodgy" brokers. Brokers they deal with are MFAA members which means there are a whole load of hurdles they have to get through to operate. And there is plenty more than the equity court available if you have a dispute.

MFAA means:
-Criminal history checked
-CRA checked
-Insured
-Trained
-Experienced
-Dispute resolution

To put it simply:
-Don't pay money upfront
-Use a broker that's an MFAA member

and alot of brokers saying that it is regulated
well sorry its not

Bring on regulation, the draft is very similar to the current MFAA code that most reputable brokers operate under. Regulation can get rid of these "dodgy" brokers and hopefully cleanup the reputation of our industry so we don't get anymore of those dubiously researched newspaper articles.

This is getting a bit off topic, MTO actually went direct to the lender and recommends using a hardworking broker next time. I'd hate to see what lenders would try and get away with if we didn't have brokers to keep them honest.

OK I'll get down off my soap box now

Dan

 

[pi2012]

Loan Australia - www.loanaustralia.com.au

Watch out you ever thinking of getting a loan from them!

Let me share with you my story...

In mid-August I applied for a loan and paid $350 for the application fee via electronic transfer. One day later, when I rang them up, they had not received (could not detect) my payment so they did not proceed my application. As I urgently needed my financial approval, I rushed to the bank to send another $350 in cash to Loan Australia. Later that day, they told me that they had received my money and they would have my application processed within 4 working days and refund the extra $350 I sent them. On the fourth working day (the day my finance term is due), I called them up just to find out that they needed 3 more working days to finish my application. I asked my solicitor to discussed this problem with the vendor, but the vendor decided to cut the deal off. As upset as I was, I rang up Loan Australia demanding full refund (as they did not fulfill their obligations). They promised to fully refund the application fees, but it would take three months to process (I thought, WTH!).

Two weeks ago, after three months, I still had not received any response from them. I called them up and guess what they told me... "Sorry Sir, we can not refund the $350 because we did start to process your application. You will get your refund for the other $350 in about two weeks time." I tried to argue that they did promise me full refund for all $700 but they said that there is nothing they could do...

Today is almost three weeks since that last phone call and I have yet to receive that bloody cheque...

Can anyone please suggest what I should do...?

They had cost me $700, $750 for my solicitor, $$$ for my bargain, my time, my negotiating effort, my phone bills, etc etc

Lessons to all:

Always do your finance before hand or if you are in a hurry, use an experienced and hardworking finance broker (you don't want to lose a great bargain like I did!) to get assuring deals! Also, be careful and not to be deceived my lower rate charges like Loan Australia has... Their service is simply outrageous!

Forumites, please share with us any of your bad experience with lenders and don't forget to name them!

Cheers

hmmm...few happy customers on this Forum though:
http://www.somersoft.com/forums/showthread.php?t=31206