houseclearou
Registered User
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My parents have a mortgage since October 1992. They took out the mortgage for a term of 15 years. In a recent discussion with their bank manager, he mentioned that their loan would be fully re-paid by May 2008. They disagreed and said it would be paid in October 2007.
I previously posted on this forum that the bank originally informed them that the reason for the increase in term was due to the currency crisis and the need to compensate for the increase in market rates at the time (which were not passed onto customers). However, we were able to show that my parents were paying the full market rate at all times during the crisis. The bank have now reverted saying in fact the reason wasn't the currency crisis but was caused by 'interim interest' accruing in the period between the drawdown of the loan and the first monthly re-payment. They now state that they added this interim interest to the loan amount and increased the term accordingly.
Again this doesn't appear to make sense. My understanding is that all interest payments are in arrears. My parents cashed their loan cheque on the 2nd of October. Their first re-payment was early November. Therefore, I can't see how interim interest applies in their scenario as they would have paid interest for October in their first re-payment. Any advice appreciated as I'm beginning to feel stupid in my dealings with the bank.
I previously posted on this forum that the bank originally informed them that the reason for the increase in term was due to the currency crisis and the need to compensate for the increase in market rates at the time (which were not passed onto customers). However, we were able to show that my parents were paying the full market rate at all times during the crisis. The bank have now reverted saying in fact the reason wasn't the currency crisis but was caused by 'interim interest' accruing in the period between the drawdown of the loan and the first monthly re-payment. They now state that they added this interim interest to the loan amount and increased the term accordingly.
Again this doesn't appear to make sense. My understanding is that all interest payments are in arrears. My parents cashed their loan cheque on the 2nd of October. Their first re-payment was early November. Therefore, I can't see how interim interest applies in their scenario as they would have paid interest for October in their first re-payment. Any advice appreciated as I'm beginning to feel stupid in my dealings with the bank.