Banking Royal Commission

[tigertim]

Just out of curiosity FB, how did the bank come around to offering you this mortgage?

I have 4 mortgages over 4 properties and the bank have NEVER offered me a mortgage loan, I always have to go to them cap in hand. In fact in my 52 years I’ve never been offered a mortgage loan, a credit card yes, but never a mortgage loan.

 

[MD Jazz]

Just out of curiosity FB, how did the bank come around to offering you this mortgage?

I have 4 mortgages over 4 properties and the bank have NEVER offered me a mortgage loan, I always have to go to them cap in hand. In fact in my 52 years I’ve never been offered a mortgage loan, a credit card yes, but never a mortgage loan.

Yeh, they don't just materialise from nowhere. And credit is harder to get than at any stage in the last few years.

 

[fastin bulbous]

We went to see a loan broker. A reputable one too. Yes we are interested in buying a place but were not interested in borrowing large amounts. We were both genuinely shocked at the amount offered. We were expecting half that at the most. Half a mil s ems to be small potatoes these days.

 

[fastin bulbous]

It ultimately depends on what information you have provided in an application. Credit is difficult to get so it would surprise me if the bank has offered you something that is simply unaffordable.

Many people would not be able to afford current mortgages if they didn't have a job, it is one of the key things to consider when entering into a loan agreement.

It may or may not surprise you but a lot of people don't actually reveal all the facts (they lie) when making loan applications? Talk to any mortgage broker and you'll understand how much lying people do when applying for loans.

Nobody forces anyone to borrow money, if people are willing to make reckless decisions they must be willing to face the consequences. Yes, there needs to be some level of protection against unscrupulous practices and exploitation of the weak but many of the stories I've read around the royal commission are ultimately of normal people making poor decisions.

Thanks MD. I agree with you but also believe many people feel forced to bite that bullet to get somewhere to live and have to over reach. Anyway, just thought I’d share my situation. We did not lie on our application. We are both too paranoid to do that.

 

[easy_tiger]

We went to see a loan broker. A reputable one too. Yes we are interested in buying a place but were not interested in borrowing large amounts. We were both genuinely shocked at the amount offered. We were expecting half that at the most. Half a mil s ems to be small potatoes these days.

I found the opposite recently FB. My income appears sub poverty line, but i have a large chunk of equity in an idyllical farm and very few debts.

I tried to borrow 40 grand off the bank ive banked with for 20 years to help out one of my kids and was knocked back. I was stunned.

It was peak RC, and apparently they had just ceased lending.

Either that, or there is something on my file about Swan St 30 sept 2017?

I tend to agree with jazz that people should be responsible for their finance management, but i think the real evil of the banks tgat came out of the RC was the heartless, if not sadistic, ways they foreclosed on ordinary people.

They needlessly destroyed many lives.

 

[fastin bulbous]

Geez eazy. Disappointing.

I think our free rent and bills made a big difference and we have a reasonable deposit. I just don’t understand the logic. Anyway I won’t bang on about it further. I hear Coonamble has a great beach and fantastic lifestyle opportunities. I’ll pop up the road and have a look.

 

[easy_tiger]

Geez eazy. Disappointing.

I think our free rent and bills made a big difference and we have a reasonable deposit. I just don’t understand the logic. Anyway I won’t bang on about it further. I hear Coonamble has a great beach and fantastic lifestyle opportunities. I’ll pop up the road and have a look.

I was surprised but a bit relieved.

I want banks out of my life.

 

[fastin bulbous]

We have trouble wanting to let them in

 

[MD Jazz]

I found the opposite recently FB. My income appears sub poverty line, but i have a large chunk of equity in an idyllical farm and very few debts.

I tried to borrow 40 grand off the bank ive banked with for 20 years to help out one of my kids and was knocked back. I was stunned.

It was peak RC, and apparently they had just ceased lending.

Either that, or there is something on my file about Swan St 30 sept 2017?

I tend to agree with jazz that people should be responsible for their finance management, but i think the real evil of the banks tgat came out of the RC was the heartless, if not sadistic, ways they foreclosed on ordinary people.

They needlessly destroyed many lives.

Yeh, many people with plenty of assets but low incomes usually struggle to borrow. Or people in the cash economy.

I don't understand why people think the banks should have hearts? They are in business to make money. I imagine if they showed more sympathy to those in strife they'd make less money. Foreclosing is often the best result for an indebted party, extending further credit or timelines just increases the amount to pay back. Stopping the bleeding by selling to pay back debts is the best option.

It's also why some of these other lenders of 2nd and 3rd resort exist. They may take over debts mainstream banks won't touch.

 

[easy_tiger]

Yeh, many people with plenty of assets but low incomes usually struggle to borrow. Or people in the cash economy.

I don't understand why people think the banks should have hearts? They are in business to make money. I imagine if they showed more sympathy to those in strife they'd make less money. Foreclosing is often the best result for an indebted party, extending further credit or timelines just increases the amount to pay back. Stopping the bleeding by selling to pay back debts is the best option.

It's also why some of these other lenders of 2nd and 3rd resort exist. They may take over debts mainstream banks won't touch.

There was one bloke testified at The RC who was being foreclosed on his farm had been in the family for generations.

Fair enough. They couldnt pay the bills, bank sells farm.

BUT, the farm was huge with multiple titles and dwellings and the old fella got several independent assessments that leaving them with a single home to dwell in, on about 5 acres, out of tens of thousands of acres and a dozen houses and titles, would make zero difference to the sale price. Zero.

So the old bloke writes and pleads with the bank ' just leave us a house to live in, zero cost to you'

And the bank goes nuh

 

[easy_tiger]

There was one bloke testified at The RC who was being foreclosed on his farm had been in the family for generations.

Fair enough. They couldnt pay the bills, bank sells farm.

BUT, the farm was huge with multiple titles and dwellings and the old fella got several independent assessments that leaving them with a single home to dwell in, on about 5 acres, out of tens of thousands of acres and a dozen houses and titles, would make zero difference to the sale price. Zero.

So the old bloke writes and pleads with the bank ' just leave us a house to live in, zero cost to you'

And the bank goes flat 'nuh'

And leaves them homeless and entirely broken.

 

[MD Jazz]

There was one bloke testified at The RC who was being foreclosed on his farm had been in the family for generations.

Fair enough. They couldnt pay the bills, bank sells farm.

BUT, the farm was huge with multiple titles and dwellings and the old fella got several independent assessments that leaving them with a single home to dwell in, on about 5 acres, out of tens of thousands of acres and a dozen houses and titles, would make zero difference to the sale price. Zero.

So the old bloke writes and pleads with the bank ' just leave us a house to live in, zero cost to you'

And the bank goes nuh

Did it come out how he ended up in that position? Did he borrow continuously when he couldn’t support it? Did he lodge false documents to get further funding?

Perhaps the bank lent him money when they should not have? Maybe he was poorly advised?

Its easy to feel sorry on the surface but this didn’t happen overnight.

Perhaps if the earlier generations had educated him better financially he wouldn’t have ended up there.

 

[easy_tiger]

Did it come out how he ended up in that position? Did he borrow continuously when he couldn’t support it? Did he lodge false documents to get further funding?

Perhaps the bank lent him money when they should not have? Maybe he was poorly advised?

Its easy to feel sorry on the surface but this didn’t happen overnight.

Perhaps if the earlier generations had educated him better financially he wouldn’t have ended up there.

Couldnt disagree more Jazz.

Noone* deserves to be wantanly destroyed, and it was wantan.

* michelia cash, steve bannon and clive palmer being 3 exceptions

 

[22nd Man]

People tell lies to get the loans they want. In the mid 80s I had to vet / approve car finance loans... You would look at a 20 something girls declared expenses with nominal or nil under clothing... You would ask "you have forgotten to include your clothing expenses... Reply would be I make my own (presumably from material reclaimed from last years fashions)

And just because they lied didn't mean they couldn't repay the loan either. Peoples incomes go up, once they have a fixed commitment some other discretionary spending is cut back.

For the RC and journalists and politicians to think they have the magic formula to who should be able to borrow and how much is fanciful. Just as many are unhappy that a bank didn't give them a loan or not what they wanted as there are people who end up over committed (and the over commitment doesn't always arise from the outset of the loan.)

Note also that bank mortgage arrears are near all time lows. Hardly symptomatic of people being forced to have loans they cannot afford.

 

[tigerman]

The Australian banking regulator has said that 1600 branches have closed in the last 6 years, wow !! That equates to one bank closing in Australia every business day for the last 6 years

Banks urged to honour 'social contract' with communities as hundreds of branches, ATMs close

Since 2017, Australia has seen a 30 per cent drop in available bank branches nationally, with more than 300 closing in the past financial year.

www.abc.net.au

 

[DavidSSS]

The Australian banking regulator has said that 1600 branches have closed in the last 6 years, wow !! That equates to one bank closing in Australia every business day for the last 6 years

Banks urged to honour 'social contract' with communities as hundreds of branches, ATMs close

Since 2017, Australia has seen a 30 per cent drop in available bank branches nationally, with more than 300 closing in the past financial year.

www.abc.net.au

Can barely even find an ATM which is owned by a bank now so they all charge to withdraw cash.

DS

 

[TT33]

Can barely even find an ATM which is owned by a bank now so they all charge to withdraw cash.

DS

Yeah it's pathetic isn't it.

But "you're business is very important to us" But our profits are the MOSTIMPORTANT THING .

 

[tigersnake]

Can barely even find an ATM which is owned by a bank now so they all charge to withdraw cash.

DS

I went into a branch a while ago. Told the inquiry person what I wanted to do, I didn't think it was that unusual, she said she couldn't help and pointed me to a phone at a bench nearby and told me to ring the call centre! This is the modern corporate business model, slash service until you start losing too many customers, then lift it slightly. Usually with an advertising campaign saying we listened when you told us how crap we are.

 

[Sintiger]

Can barely even find an ATM which is owned by a bank now so they all charge to withdraw cash.

DS

What’s cash ?

 

[Sintiger]

As an aside on banks it seems strange to me that there is not more noise being made about the fact that the banks are not increasing their deposit interest rates in line with their borrowing rates.
To me it is pure profiteering