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Every good story deserves at least a trilogy, 1 2 3 and others limp on for a forth far less satisfying installment that is disappointing when compared to the original blockbuster.
This has been the case with Bryce the banker, my own personal banker at ASB Bank in Albany.
This time I called Bruce about a small loan of about $25,000.00 that I wanted to pay off early.
Easy right?
Well no it wasn't.
The upshot is that I will be charged around 500 bucks for the privilege of paying off my loan 2.5 years early.
So what is my beef this time you ask?
Well, when re-negotiating this loan almost 3 years ago I asked some specific questions and got some specific answers from those questions.
My questions were:
1. will I be able to pay off lump sums easily without incurring penalties?
2. can I pay the loan off early without getting slam-dunked with a fee?
Not a problem was the answer to both these questions.
Well apparently it is a problem now and Bryce quite chirpily pointed out that the fees and charges were in my loan document that I signed, and he is right, they are.
But Bryce I asked the pertinent questions, was answered in the affirmative, so trusted the personal banker at the time (not Bryce) that I was getting the deal I thought I was.
But Chief you should have read the fine print in the contract said Bryce.
I know, but your representative at the time told me...you get the fast revolving point and I have had all my business with you for nearly 20 years... wheres the LOVE where is the LOYALTY Bryce!
But the contract Chief, the contract ! - say it in your head with the voice of a very small Mexican with a lisp wearing a white suit and smoking a big cigar.
My point is, regardless of the contract, I was told verbally in the main points of the loan, that no costs would be incurred by me for being a diligent wee boy and paying off my loan early and I went on my merry way with my lovely loan.
Also I have paid off two large lump sums of $10,000 in the past and incurred no fees or charges.
To cut this forth installment short I am taking my bank to the banking ombudsman and the small claims court for breaking the Fair Trading Act - mis-representing a good or service for sale.
The main point of this rather disappointing sequel?
If you have a problem at your bank, don't roll over and ask to be taken from the rear, get on top and try to screw the scrum straight, you will at least feel better and you might even get a positive outcome. You can guarantee if you don't pin them to the wall they will continue to get your pants around your ankles at every opportunity.
Bryce is no longer my personal banker, I fired him for calling me Chief way too many times - once is enough, can you believe that?- and now the manager of Albany Branch is handling my accounts.
I am also looking for another bank.
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My adventures with Bryce the Banker have kept myself and many others amused and there is yet another tale to be told about the ASB in Albany and its approach to customers now that the economic wolves are seemingly at their customer's doors.
When I visited Bryce the last time I asked him what the chances of me getting a loan to buy an investment property was.
He kind of laughed nervously and mentioned it was harder now than it was a year or so back but thinking to myself, considering I seemed to be the only middle class Kiwi who didn't buy an investment house during the housing boom, I now thought it was a good time to buy one.
Consider this:
1. Housing is approaching realistic asking prices
2. Your expenses are now likely to be recouped by the rent received
3. Interest rates are lower by at least 2% than during the boom
But then also think about this:
Even though my financial position is now stronger than it was a few years back and the investment case to buy a house for rental purposes is much more attractive, the ASB Bank and probably yours too is unwilling to lend as much money for that purpose.
Interesting that in some cases at the height of the housing boom that banks were lending more than 100% mortgages and throwing money at monkeys while now they will barely consider you even though you now back their deposits and lending through your taxes.
A case for some contrary investment thinking, in other words good sound financial practice, is clearly needed within our banks and the staff that they employ.
Treat each customer and lending case on its own individual financial merits and you will please your good customers and keep your CEO from losing sleep at night.
End of lesson.
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c Share Investor 2009
I mentioned to one of my email correspondents that I would return in a few months to see my bank manager, "Bryce" at the ASB Bank in Albany after having seen him first late one Thursday at the end of February to re-negotiate the terms of our rather large mortgage.
I did, sort of.
This time Bryce was unwilling to see me after my hard workday so we discussed the matter over the mobile.
I would have preferred to see him in person but he insisted I couldn't.
I pointed out to him, again, that the New Zealand taxpayer was guaranteeing banks in New Zealand so they could borrow cheaper money from abroad to lend to us.
Bryce pointed out to me that it wasn't the taxpayer that was going guarantor,it was in fact the Government.
After pointing Bryce to the error of his ways over the fact that Government and the taxpayer were one and the same (Bryce still doesn't think they are) I thought out loud that wasn't it funny that as a borrower from his bank, the ASB, that I was now a guarantor for my loan but also as a taxpayer I was going guarantor for his bank to borrow the same money to lend back to me.
This seem to confuse Bryce but it was very clear to me.
I added what I said at our Thursday evening meeting in February, that we are clearly living in exceptional economic times, something Bryce agreed with during the mere half dozen times I repeated that same mantra.
Bryce said I would be breaking my contract with the bank if we re-negotiated without an outrageous bank fee and I agreed with Bryce at that stage but had to point out that the terms of our contract had clearly changed because I was now going guarantor for both his and my borrowing, hence making it cheaper for Goldstein and his fat American buddy to borrow money in the first place.
We both became dizzy as I reiterate the above several times (I don't let go once I sink my teeth in) to no effect at all.
The bank will not negotiate at all, that is all he had to say from the get-go
Before we both left the conversation, Bryce pointed out that the bank had been around for 100 and something years and was "very safe" immaterial of any taxpayer/Government guarantees and then I asked him why then did the bank sign up to the guarantee and he kindly pointed out because that is what the other banks were doing and it wouldn't "be fair" to the ASB if they didn't join the party.
Fair... mmm, yes but, why?...
A asked whether the bank had these sort of guarantees during the 1930s, he didn't know, I left none the wiser and Bryce left probably wishing he hadn't returned my call.
I don't think Bryce is going to take another call from me.
I will however have another go in a few more months.
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Every good story deserves at least a trilogy, 1 2 3 and others limp on for a forth far less satisfying installment that is disappointing when compared to the original blockbuster.
