Commonwealth Bank & interest payments...dontcha just love it!
#31
Re: Commonwealth Bank & interest payments...dontcha just love it!
...yes it is in the banks favour unless a customer intends staying the life of a mortgage ....in a nutshell
1. If it's a variable loan and variances were agreed i.e if interest rates go up, pay more, if interest rates go down, pay less. Then this is what should happen surely? Especially if this did happen and they just decided to change the rules without permission. I think that's a fairly reasonable expectation don't you?
I personally don't care what happens in say 20 years time. What if I change loans due to moving say in 5 years, will my initial sacrifice be worth the small payment reduction on the principle loan in 5 years time? It might be worth me paying over and above in the long term (4 years overall loan reduction by the end of the term) but how many customers really keep a home loan without moving to another bank within the life of a mortgage? The banks know this which is why this arrangement is good for them and good for the custmer (but only if the customer goes the full term - otherwise it's negligable). The reduction in interest over the years due to paying more off the principle loan in small amounts is negligable Vs the benefits to be gained immediatly if economic times are hard
2. My other point is if a fee was added for the benefit of a credit card that wasn't asked for then this fee should be waivered. If a customer didn't ask for it and didn't want it or need it I reckon that's fair don't you?
3. As for going to the ombudsman - the first thing they ask is have you spoken to the bank, which I have So I'm waiting for the bank to get back to me and as a good/ loyal customer I'm expecting the fee to be waivered
So hopefully if this has happened to anyone else it's their choice. Everyone has different circumstances and different requirements.
Just sayin like
1. If it's a variable loan and variances were agreed i.e if interest rates go up, pay more, if interest rates go down, pay less. Then this is what should happen surely? Especially if this did happen and they just decided to change the rules without permission. I think that's a fairly reasonable expectation don't you?
I personally don't care what happens in say 20 years time. What if I change loans due to moving say in 5 years, will my initial sacrifice be worth the small payment reduction on the principle loan in 5 years time? It might be worth me paying over and above in the long term (4 years overall loan reduction by the end of the term) but how many customers really keep a home loan without moving to another bank within the life of a mortgage? The banks know this which is why this arrangement is good for them and good for the custmer (but only if the customer goes the full term - otherwise it's negligable). The reduction in interest over the years due to paying more off the principle loan in small amounts is negligable Vs the benefits to be gained immediatly if economic times are hard
2. My other point is if a fee was added for the benefit of a credit card that wasn't asked for then this fee should be waivered. If a customer didn't ask for it and didn't want it or need it I reckon that's fair don't you?
3. As for going to the ombudsman - the first thing they ask is have you spoken to the bank, which I have So I'm waiting for the bank to get back to me and as a good/ loyal customer I'm expecting the fee to be waivered
So hopefully if this has happened to anyone else it's their choice. Everyone has different circumstances and different requirements.
Just sayin like
Trade Practices Act
Unasked for credit cards
Section 63A of the Act prohibits a corporation from sending a credit or debit card to a person unless that person has requested the card in writing or the card is no more than a renewal or replacement of an earlier card.
Unasked for goods and services
Section 64 of the Act prohibits a corporation in trade or commerce from demanding or asserting a right to payment for unsolicited goods or services, unless the corporation has reasonable cause to believe that there is a right to payment.
Last edited by mulben; Jan 8th 2012 at 12:40 am.
#32
Re: Commonwealth Bank & interest payments...dontcha just love it!
...yes it is in the banks favour unless a customer intends staying the life of a mortgage ....in a nutshell
1. If it's a variable loan and variances were agreed i.e if interest rates go up, pay more, if interest rates go down, pay less. Then this is what should happen surely? Especially if this did happen and they just decided to change the rules without permission. I think that's a fairly reasonable expectation don't you?
1. If it's a variable loan and variances were agreed i.e if interest rates go up, pay more, if interest rates go down, pay less. Then this is what should happen surely? Especially if this did happen and they just decided to change the rules without permission. I think that's a fairly reasonable expectation don't you?
On one occasion I wanted the reduction in payments, so had to ring them and ask for it. You should check your terms and conditions of your loan, as I think you were probably lucky to get the automatic reduction previously as I don't think that is standard practise for them.
I also got a product summary thingy (terms and conditions) sent to me once a year. Any changes they had made were then covered for
I personally don't care what happens in say 20 years time. What if I change loans due to moving say in 5 years, will my initial sacrifice be worth the small payment reduction on the principle loan in 5 years time? It might be worth me paying over and above in the long term (4 years overall loan reduction by the end of the term) but how many customers really keep a home loan without moving to another bank within the life of a mortgage? The banks know this which is why this arrangement is good for them and good for the custmer (but only if the customer goes the full term - otherwise it's negligable). The reduction in interest over the years due to paying more off the principle loan in small amounts is negligable Vs the benefits to be gained immediatly if economic times are hard
From the way you are coming across in your posts it seems you think that the interest you pay hasn't been reduced, when this is not the case. The payment hasn't been reduced, but the interest has - you are just paying more towards paying off the debt that you were before each month. (maybe I'm reading your posts wrong?)
It's irrelevant to me now though as I left him and he re-mortgaged to pay me my half of the equity. I now rent so pay someone elses mortgage
2. My other point is if a fee was added for the benefit of a credit card that wasn't asked for then this fee should be waivered. If a customer didn't ask for it and didn't want it or need it I reckon that's fair don't you?
I was on an offset mortgage, and part of the package was a credit card (which we never used and destroyed). The product had an annual fee which was waived for the first year - are you sure that's not what's happened?
From their site: http://www.commbank.com.au/personal/...s/compare.aspx
To be eligible for Wealth Package, you must have an initial 'total home lending balance' of at least $150,000 and pay an annual package fee of $350, debited to any Commonwealth Bank transaction account or Commonwealth Bank Credit Card. Wealth Package terms and conditions available on application.
1. Ongoing annual fee waiver is available on one eligible Commonwealth Bank credit card account only while you remain eligible for Wealth Package. Concession applies to Platinum Awards, Gold Awards, Awards, Low Rate, Low Fee Gold, Business Awards, Business Gold Awards and Business Platinum Awards credit cards.
2. One year waiver applies to the annual fee in the first year if you apply for the card at the same time as your home loan. Excludes business liability credit cards, corporate cards and personal liability Business credit cards without Awards.
3. As for going to the ombudsman - the first thing they ask is have you spoken to the bank, which I have So I'm waiting for the bank to get back to me and as a good/ loyal customer I'm expecting the fee to be waivered
So hopefully if this has happened to anyone else it's their choice. Everyone has different circumstances and different requirements.
Just sayin like
So hopefully if this has happened to anyone else it's their choice. Everyone has different circumstances and different requirements.
Just sayin like
I hope you manage to get it all sorted out.
Last edited by Wendy; Jan 8th 2012 at 12:46 am.
#33
no stressin no fussin....
Thread Starter
Joined: Aug 2007
Location: Fantasy Island....
Posts: 12,616
Re: Commonwealth Bank & interest payments...dontcha just love it!
Banks play on the long term logic of it all and sell this as an advantage as initially their explanation looks credible The issue is smoke screened by the fact there are many variables which make it not as black and white as it first seems - customers buy into it thinking "ahh well...I guess I gain benefits overall cos it reduces the prime mortgage payments and knocks years off at the end"....when in fact pending certain variables overpayment can be a disadvantage to certain customers who's circumstances change.
Banks are far smarter than that. They tell you "ohh if you pay more off your loan you knock X amount of years off your mortgage" which sounds credible and can be true but not in all circumstances. They aren't in it to reduce the term of your loan or let you pay less overall, they do it to get as much money from you today, which is worth a fraction of its worth in years to come. They also know most people *submit* well before the end of the term of the loan cos the chances of staying the long term are not high (most people move house & banks and therefore they payout the loan which means their few years of overpayment is not as valuable as they first thought as they do not benefit anywhere near as much for finishing the loan early). This means the amount you gain by submitting your loan early is negligable if you don't intend to stay the life of the loan. Which means it's not of benefit to all customers
Overpayment can be of benefit....but not always. It depends on the value to each customer of the overpayment Vs the less interest they pay over the term of the loan as a result of this overpayment. It might be better for a customer to not overpay (and reduce) their loan but instead pay less today and catch up years later when their circumstances improve. There are so many things to take into consideration to decide the pro's and con's.
Anyway my point is not how it works as I understand how my mortgage works and how this fits with my long term plans. My point is i was not told of the changes (the bank must have made the change for my good) and my point is that i thought there might be more of you in the same boat who might benefit from this awareness. There might be some who might not benefit..but then that's your choice based on your circumstances
Anyway....you got it mate
#34
no stressin no fussin....
Thread Starter
Joined: Aug 2007
Location: Fantasy Island....
Posts: 12,616
Re: Commonwealth Bank & interest payments...dontcha just love it!
seems you have a good case for the banking ombudsman
Trade Practices Act
Unasked for credit cards
Section 63A of the Act prohibits a corporation from sending a credit or debit card to a person unless that person has requested the card in writing or the card is no more than a renewal or replacement of an earlier card.
Unasked for goods and services
Section 64 of the Act prohibits a corporation in trade or commerce from demanding or asserting a right to payment for unsolicited goods or services, unless the corporation has reasonable cause to believe that there is a right to payment.
Trade Practices Act
Unasked for credit cards
Section 63A of the Act prohibits a corporation from sending a credit or debit card to a person unless that person has requested the card in writing or the card is no more than a renewal or replacement of an earlier card.
Unasked for goods and services
Section 64 of the Act prohibits a corporation in trade or commerce from demanding or asserting a right to payment for unsolicited goods or services, unless the corporation has reasonable cause to believe that there is a right to payment.
Last edited by sonlymewalter; Jan 8th 2012 at 1:26 am.
#35
no stressin no fussin....
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Joined: Aug 2007
Location: Fantasy Island....
Posts: 12,616
Re: Commonwealth Bank & interest payments...dontcha just love it!
By paying over the odds on our mortgage (with just the reductions in interest rates being paid off the mortgage by leaving the loan payments alone) was going to reduce our loan term from 30 years to 16 years...a massive saving of 14 years of payments. We did pay fornightly as well though, so that was an extra months payment a year too
From the way you are coming across in your posts it seems you think that the interest you pay hasn't been reduced, when this is not the case. The payment hasn't been reduced, but the interest has - you are just paying more towards paying off the debt that you were before each month. (maybe I'm reading your posts wrong?)
Thanks mate
#36
no stressin no fussin....
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Joined: Aug 2007
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Re: Commonwealth Bank & interest payments...dontcha just love it!
Just to put this thread to bed....
Got an email from the bank. Fee waivered and from now on it will be decreased / increased with rate changes, unless I change this agreement with them. Result
Just goes to show if you can be arsed and you're a good customer they'd rather be sensible then lose yer custom
noice
Got an email from the bank. Fee waivered and from now on it will be decreased / increased with rate changes, unless I change this agreement with them. Result
Just goes to show if you can be arsed and you're a good customer they'd rather be sensible then lose yer custom
noice
#37
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Joined: Jul 2008
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Posts: 3,043
Re: Commonwealth Bank & interest payments...dontcha just love it!
Just to put this thread to bed....
Got an email from the bank. Fee waivered and from now on it will be decreased / increased with rate changes, unless I change this agreement with them. Result
Just goes to show if you can be arsed and you're a good customer they'd rather be sensible then lose yer custom
noice
Got an email from the bank. Fee waivered and from now on it will be decreased / increased with rate changes, unless I change this agreement with them. Result
Just goes to show if you can be arsed and you're a good customer they'd rather be sensible then lose yer custom
noice