Saturday 31st Jul 2010 12:39 AM
Welcome to Qotion.com!
Qotion.com is a website for you to browse and discuss financial products. Currently, we are undergoing further development, and hope to serve you when we relaunch the site with new features. If you are interested in our development process, do fill in the subscription box on the right for upcoming newsletters.
Mon, 08/31/2009 - 12:01
Hi to all the folks out there.
I recently heard from my friend that bank loans for property purchases can be subjected to re-negotiation by the lender. An example will be if an accident happens and a spouse becomes the loan-bearer. In that case, I heard the bank will review the terms of the loan and demand a refund of all outstanding monies within 3 months if the spouse is judged not capable of footing the loan. Is this true?
If that is, then is there any other circumstance when the banks can do something similar e.g. retrenchment, retirement etc? I find the idea of lenders forcing borrowers to assume all the risk in a loan pretty distasteful. If possible I will like to find out how to deal with this.
Zexter, not sure about the case of your friend, but surely in the interests of the bank providing the mortgage, they will exercise options depending on what the circumstances are.
Your friend can obtain independent financial advice with regards to this concern.
Usually, here, the banks will just take the house if you can't pay up. And these days customers that can afford the loan negotiate with the bank on the rates from time to time as well. So renegotiations work both ways =)
I am not referring to the issue of the banks renegotiating the loan, I am referring to an instance where even if the widow somehow comes up with the cash to foot the installments, the bank will demand the full sum within 3 months if it thinks this is unsustainable.
I heard this from a friend working in a bank btw. This sounds to me like an abuse of consumer rights.