So got an email from CBA today stating they will be lowering my home loan repayments to the lowest minimum required. No ifs or buts. Automatically going to happen and cannot stop it. To change it back I have to contact them 5 days after that fact…
Yes I know it's a simple thing to do (I hope it is in my case as it's in a joint name and I don't have contact with the other party), I just find it annoying and frustrating that they are making this choice for me and every other customer.
@Donaldhump: Why should or anyone have to do this change cos the bank has decided for me to change my repayment amount automatically?
What about the people who haven’t realised the change the bank has done for them??
not being offensive
I think this highlights unclesnake's lack of connection in the discussion. Feels like you've got a good system that's better than what OP currently has set up, but you've shared it in such an arrogant and offensive way even I would rather drink snake venom than accept it. Forcing OP to reveal all this personal information to satisfy the desire to point out the superiority of the method whilst completely ignoring the other key point OP is trying to make.
Doesn't matter how good the message is if it's delivered like a jerk. Then getting frustrated when the other person doesn't understand, but remember, communication is a two way connection. You play a part in them not understanding too.
@Danstar: "was already established" until they decided to do us a "favour" by redcing the agreed amount to the minimum without direction to get some extra interest they otherwise wouldnt have gotten for our pockets…
We can see how we can work around it, its not the point...... the OPs post is just about the audacity of the bank…
@Donaldhump: I’m already divorced and settled. Just lost contact with ex and going to court multiple times before they finally give you what you want is a drainer
@Danstar: Just FYI - CBA allows you to have an offset just in your name without the ex spouse need to sign anything . Unless Ofcourse you have a no frills mortgage which didn’t have an offset feature. You don’t need her permission to have an offset.
@Danstar: if you are getting loan related email - means you are on the loan as an account holder and unless you have a no frills mortgage (which normally have lower rates than the standard variable rate loan to start off with especially at higher LVR’s)- these no frills loans don’t allow offset as a feature. So if you aren’t on one of those no frills mortgage there is no reason you can’t get an offset without anyone else to sign anything. Maybe hence the bank asking you to refinance / swap to another loan type which will/may require you to get ex spouse to sign. Even then I would think that if the loan is one to sign ( either to operate ) you should be able to swap to a loan at a slightly different interest rate / annual fee / offset feature etc. I had one of these and swapped over to SVR a while back
@Maxdax: Loan is needing both signatures for any changes, and I am on one of those loans which had a heavy discount for the first few years and no is as you call it a 'No frills' loan.
I've had multiple dealings with my bank, with my current situation I can't do nothing with my loan until I get my ex to sign anything (which I've tried numerous times) or go back to court to get an enforcement order…which I don't have the time or the will to do at this point in time.
I'm happy enough with my home loan for the time being, if I was desperate to change it. I would've gone to court by now
Not the email I got;
Great news, we’ve reviewed your Variable Rate Home Loan with account number ending in XXXX and because your interest rate has reduced or you’ve made additional repayments, we’re decreasing your minimum monthly required repayment amount.
We won’t automatically reduce your direct debit repayment amount below as we understand that you may want the flexibility to pay your loan off sooner, and to be in control of your repayments.
.
Interesting they are sending different emails to different customers. I await to see what mine says.
I get that notification after every interest drop too.
This is an older email and not relevant to the one OP is about
i don't get this, did they reduce the direct debit for homeloan repayment ?
will this affect me if i have always been manually transfering the amount to home loan account ?
Not sure of your exact circumstance, but usually their is a minimum payment amount to pay off a loan each month. Some people pay extra to reduce interest charges and the loan term. The banks are changing some of those people who pay extra to the minimum amount to “save” them some short term money
Watch for OP's post in a few years: "Bank wants to charge me to finalize fully paid-off loan early!"
No. I don’t have any early payout fees. Again assumptions only do one thing…
Says the person who assumed absolutely nobody in the country wants their minimum repayments lowered.
I’m sure there are many who do. But it should be up to them to call up the bank and do this. Which I’m sure many have. Or like someone else commented, that maybe the bank could’ve just advertised this option for people to take up. Not have it done to them automatically
The point is that they weren't asked. They have it set up how they want. If they need the money they can redraw and lower the payment to minimum themselves.
I'm seriously LOLing at this post… Australia's looking at 10% unemployment real soon now, and one of the fortunate few who actually aren't stressing over their commitments seems to have nothing better to do than troll this post trying to convince the world that they're butthurt about having their loan repayments adjusted.
Have you bothered considering that there are many, many people out there who would otherwise be faced with having their loans go into arrears because of that one missed repayment? The move gives everyone instant breathing room to act… They've given a whole bunch of people time apply for some more enduring arrangement for the coming months.
Make a manual payment this month, fill in the damn form, move on.
If you’re stressing about your home loan repayments and you need the bank to automatically adjust it for you so you pay less, id be pretty impressed that those people even Managed to buy a house.
It’s not hard to change your repayments to the lowest amount of you pay overs. But why should I and anyone else who doesn’t want this change need to reapply to go back to what I had in the first place
…id be pretty impressed that those people even Managed to buy a house.
Wow… seriously? If there was any doubt that you're either trolling, or completely removed from reality, or both, that has now gone.
It’s not hard to change your repayments to the lowest amount of you pay overs.
Wait these are the same people that you just suggested achieved a small miracle just buying a home, right?
Keep on trollin' mate… I need to do something slightly less infantile, so I'm off to watch teletubbies.
I can't tell if you are trolling? Why can people not adjust it to suit their circumstances? Op is fine, so doesn't need the bank randomly changing his payment. Someone who is warning less can lower their payments.
@Donaldhump: It is, and normally I would say just sick it up op, but making you fill out a form, and making you wait, as well as just sending an email, is not right. It is simply looking to take advantage of people who just assume that the amount they want to pay is being paid. They will check 3 years later and have paid a tonne ore interest.
@brendanm: You don’t have to fill out a form
If you do the paying yourself instead of a direct debit you won’t have this problem.
@Danstar: Not arguing I gave you a reason why banks do it, and an automated method to solve your issue which would take 1 minute, require no phone calls. But yet I’m sure you haven’t bothered.
If you think banks are doing you bad, complain to the financial ombudsmen, get a lawyer, study the financial acts, and go forth and sue them.
@Donaldhump: I’ve never seen the banks automatically reduce people’s repayments automatically without opting in for it
@brendanm: It’s easy solved with 5 minutes work, and should be done day one of your loan if you want to pay a specific amount above the min payment. Then you can never log in again.
banks adjust minimum repayments for obvious business reasons, always have and always will in line to drag the loan out to it’s very end.
If they didn’t reduce it inline with the current bank int rates, then poor people would complain that they had to ring up to get it reduced,
If people aren’t aware of their repayment amount and that they can lower it if they’re paying more than the bank is asking for, then paint my hair pink and frill it upwards
People can do it themselves. They don't need it forced upon them. It will be most people's largest expense, if you can't figure out that you should lower your payments if you can't afford to pay extra, you have bigger problems.
Thank you Brendan :)
I think he just likes using the word troll
Seems that way doesn't it. This also just seems like a cashgrab from CommBank, hoping some people won't see it, and will end up paying more interest.
Like someone said above, you’d be surprised how many people don’t know that they are paying more and don’t know they have an option to reduce their payments. My brother who has been asked to go on forced unpaid leave ( as a example) is welcoming the change. I don’t understand what the issue is. If you are paying $1000/week and it drops to $500/week - the money is still sitting in your offset account so you don’t get charged anything extra. If you don’t have an offset simply transfer that extra $500 yourself for that week. I have changed my repayments a lot of times on netbank it’s a 2 minute job. There are no forms etc to fill. Not sure what the fuss is all about. IMO this will benefit those who are no financially savvy / aware what they are paying on their mortgage and those who are ( like you/I ) will make the change to suit their circumstances. Cheers
What about the people who don't know it's changing but happy to keep paying the amount they have been?
@Danstar: It’s sitting in their offset ( hence costing them nothing) and if they are silly not to have an offset or don’t care much about it in the first place then so be it - the savings didn’t / doesn’t matter to them on the biggest asset / investment of their lives
@Maxdax: Not everyone has a home loan type with an offset. Yes they should (as should I) but circumstances at the time meant I didn't and I'm sure would be the case for many others too.
Not sure why people want to argue against the fact that the banks are changing peoples repayments without asking…that's the point of this post. Not what type of loan people should get, or what features, etc.
@Danstar: If it’s in the T&C then you have nothing to complain about. If not, go them for beach of T&C.
You can also complain to AFCA.
@Vote for Pedro: A lot of people are missing my point. It's a nuisance and annoying, but the main point of my post is to alert people who may be with CBA and have this done to their mortgage repayments and not be aware of it.
I understand an offset account is mroe advantageous
I understand you can deposit money into your Home Loan at any given time
I know their are better banks out there.
But this post is simply what my post says!
If you want to alert others of alternatives, make a new post!
OP do you have offset account? No matter how low the minimum payment is. Can't you put more money into the offset account?
No.
Can you get an offset account?
No. I have to re-finance which I can’t do at this point in time
Offset accounts cost money, usually through a higher interest rate or annual or monthly fee.
I didn't understand all the dram til I saw that CommBank does the direct debit for you and is also lowering that.
NAB has lowered mine too but I have always had to have my own payments setup which are unchanged. Just means my redraw will build up faster.
Cba usually just inform when they lower your IR and your repayments can be lowered but have never automatically lowered my repayments
Yes same. NAB has never changed my repayment until now. Dropped by $350 a month.
NAB doing the repayment review probably once every two to three years time. That is the reason why we barely see the repayment get amended. Normally I do is to pop to the branch and get the lender to sort it out for me or give a call to the call centre to review my repayment.
@chloe1234: I didn't want to risk me getting into the habit of paying off less in case interest rates went back up so i have never asked, but good to know it can be done in the future, thanks
Well done been trying to drill this into op head for half a day now
And I’ve been trying to drum into you that the original point of my post was to inform those who may not notice the change if it applies to them….
Banks profiteering from a crisis???
Oh no!
Who would have thought!
So unexpected!
Grow up. Take some responsibility for your repayment and add the bit extra yourself. You know the bank is not your friend.
I am taking responsibility. Thus the point of my post, pointing out the fact that the bank wants to try make me pay the lowest amount possible
If people aren’t paying attention to correspondence about the biggest investment in their life, they should take a good hard look at themselves. Banks are not our friends. Once we come to terms with this, we will lead happier lives.
I’ve stated this in another comment.
There are literally not enough service people to deal with the number of people who can't pay out their loans. It is much easier to just flick a button and select all and apply it.
There is immense hurt across major industries now especially lower tier workers.
Well looks like it's not across the board though…according to a few people who've responded in here saying they haven't been informed of this change on their repayments
They probably didn't get the email
Meh, I already changed down to the lowest possible repayments as soon as rates went down last month to maintain maximum loan value for current and future tax purposes.
I also pulled all my redraw on my loan that I am using as an equity release for personal expenses and put it back in offset. Not going to risk the banks changing redraw policies when shit hits the fan, like for example entitled tenants deciding their 'rich' landlords can shoulder all the burden….
Honestly serves CBA customers right for being with CBA
Why anyone would bank with them is beyond me
We don't live in the 1950s banking is pretty much the same whoever you bank with why go with the most expensive bank in the country?
Not cool
Is this new or have they always done this as rates fall? I know ANZ send out the notification letters but do the opposite - don't reduce repayments.
For me, they usually just show in my transaction page the new minimum monthly repayment. But never have changed my monthly repayment without me asking for it
If they really wanted to help everyone they would put interest on hold and have everyone's direct debit go to the principal, just because times are tough doesn't mean everyone needs to change the biggest cost in their budget.
So many other things to cut before I would consider blowing out my mortgage from 15 to 30yrs!
This is NORMAL procedure for all banks.
However you can ask them to put a stop on this and keep your reyaments the same.
You can after they’ve changed it to the lowest. Which is plain stupid
Great time to switch loans to another bank I say.
ING haven't done this yet but I'd end the loan immediately if they did.
I'm assuming this is not being applied entirely across the board - I have not received any email notifying of this change. I suspect its being applied for certain customer cohorts and I don't fit into those.
I got the same BS email.. they wont answer the phone either…
I've now received the email as well. Might just leave it, I'm in a fortunate position where my loan is fully offset and the loan repayments just draw down from the offset, so other than the psychological effect of seeing the loan balance reduce faster it has no real world impact for me.
It's on the Commbank webpage if you haven't received the email yet. (Commbank > Coronavirus Support for home loan customer > Direct debit changes).
Kind of annoying that I'll need to change it back and there's no opt out option.
Direct Debit Changes
From 1 May, for eligible customers who pay via direct debit, we will be automatically reducing the direct debit repayment amount for all Principal and Interest variable rate Investment/Home loans to the minimum required repayment.
You’ll have the option to change your direct debit repayment from 6 May if you wish to continue paying above your minimum repayment, in NetBank or the CommBank app. We will be in contact with all customers in April with more information.
CBA suck. I've had an account with them due to their scammy Dollarmites crap, and still keep the account, but most of my money is with UBank.
Suck on that CBA you (profanity).
I don't get all this negativity to CBA.
If they didn't do this you can bet the 7.30 report or others will have a headline news story saying 'bank forcing customers to maintain full repayments….'
The banks are dammed if they do and dammed if they don't.
They are simply reducing the monthly payments to the minimum, very understandable given the financial pressure so many of us are now under.
They are doing this for everyone because of the expectation that they have to serve the lowest common denominator, courtesy of the banking royal commission.
For those able to and wish to, just transfer any excess funds into the loan (or preferably to an offset if you have one).
I get your point, but a simple opt-out option would be good - instead they make it harder for you by asking you to "remember to do this after May 6." which is such an obvious dick move hoping people forget to do so imho. As people have said, they're not our friends but hey I'm still gonna rant about it. :)
edit double post
I suppose for any sane person who has financial trouble, one of the first things they look at is their debts. The fact that you rely on the bank to reduce your repayment to alleviate your financial stress is something I can't understand whatsoever.
So I see this as a means to squeeze more out of their customers because home loan interest is calculated on a daily basis and I bet a lot of people who repay a lot higher than minimum may not be aware of such change till much later and will get charged extra interest as a result.
I find this tactical move very disgusting simply because of the noble disguise.
100% agree. I get that you can change it back immediately no dramas and they probably make a few cents off of you per se, but multiply that over millions of mortgages = easy money for CBA.
CBA = Can't be Arsed.. To do the right thing
how have people got their banking set up so that this is a bad thing?
I have an offset account and a bank loan. All my pay goes into the offset account - once a month the bank deducts the repayment from my offset to my loan.
So the repayment being less is actually a good thing - I get to keep more money in my offset which I can withdraw from instead of from my loan account which I can't withdraw from…
Isn't that how everyone has their banking set up?
You can’t redraw cos you have an offset account. But
Please go on about this rare feature
an offset account is just like a savings account but instead of the bank paying you interest for the money you have in there, the money offsets your loan so you pay less interest to the bank.
Like a savings account, you can withdraw from it freely but the more you have in there, the more you save.
It's better than a savings account because with a savings account, you have to pay taxes and the interest rate the bank gives you to have your money in there will be less than the interest rate the bank charges to lend you money.
Having a loan with offset is usually more expensive i.e. Package fees and slightly higher rate than the vanilla home loan. But i agree with you, for me offset account is a must have especially this tough time.
Do you pay annual fees i.e. Package fees? If so you should have offset account, just ring the bank and set it up for you, make your normal saving account "offset" your loan automatically. And if i was you, i would take all the money in redraw and park it in the offset… At least for the time being.
No, I don't want to pay a higher interest rate or an annual package fee so I don't have an offset account. I can pay extra into the loan and redraw the money if I need to.
Well if that's the case that you pay extra into your loan and redraw on it, it seems you already pay more than the minimum, do what does it matter that the minimum payment has decreased?
@Danstar: **** me drunk.
Automate it so that you push the amount you want, a static value of your choice
Instead of them
Pulling it of the amount they want, a dynamic value that has become lower.
It’s not fkn hard for gods sake
Do you have rocks in your head, not being offensive but the penny isn’t dropping here… you make me want to chain smoke
I’ll seriously drive to your house and set it up myself.