Bank turns down man for $80,000 mortgage - He closes $190,000 savings account
Bank turns down man for $80,000 mortgage - He closes $190,000 savings account
Mr Griffiths, a loyal Westpac customer for 25 years, decided to withdraw his money after the bank rejected his application for an $80,000 mortgage. Having decided to withdraw his money, he then decided to make it hard for the bank by requesting payment in $20 bills. picked by tigertony 1 month ago
tags Westpac bank New Zealand Roger Griffiths
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 quote edit #1 

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44
 maven
1 month ago
I agree that he should have left, but making it hard on the teller was a bit much. It's unlikely they had anything to do with the policy making.
253
quote #2
17
 shep182
1 month ago
A withdraw of that size rarely goes thru a teller... but who knows...
104
quote #3
32
 lynxears
1 month ago
« maven : I agree that he should have left, but making it hard on the teller was a bit much. It's unlikely they had anything to do with the policy making.
True, but this way he got a free tote bag to go with his withdrawal! What a deal!
226
quote #4
43
 Bingo
1 month ago
I think it's crap. He doesn't have a reliable income, he shouldn't have gotten the loan. That's the way it goes. You go try it.

Did he use his savings as collateral (can you even do that?)?

He says what tipped the scale was that the bank lost money on another issue not related to him.

So in other words, this artist who has an exhibit (woohoo) got himself a pissy on, and had a tantrum.

What a childish thing to do.
140
quote #5
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44
 maven
1 month ago
Artists don't get monthly paychecks, but that doesn't mean they aren't able to make regular payments. It's the same thing for waitresses--income varies month to month, so the banking industry penalizes them NOT because they haven't made payments on time, but because they MIGHT? This guy had been with the bank for 25 years and presumable had loans from them previously, and now they decide not to give him another for a spurious reason. I'd be insulted as well!
333
quote #6
32
 kerobero...
1 month ago
« Bingo:I think it's crap. He doesn't have a reliable income, he shouldn't have gotten the loan. That's the way it goes. You go try it.

Did he use his savings as collateral (can you even do that?)?

He says what tipped the scale was that the bank lost money on another issue not related to him.

So in other words, this artist who has an exhibit (woohoo) got himself a pissy on, and had a tantrum.

What a childish thing to do.
I am a Freelance Artist... I don't have a monthly paycheck and I pay my bills on time, sometimes more than the minimum due... And let me add: With money I earn, my husband DOES NOT pay my debts...

My chosen industry is a fickle mistress... there is feast and famine. I haven't hit a famine period yet, but I know they exist and that could potentially mean I don't have an income for 3+ months...

And EVEN when I was unemployed for 3 years back in 2003, I had NO Income and yet I managed to pay off a car loan.

If that would have happened to me, having been loyal to a bank for that long, you betcha I would have left...

We would like to welcome Mr Griffiths back. We just need the confidence regular repayments can be met."
Yeah, no! If the bank didn't have the confidence in Mr. Griffiths to make such repayments after 25 years of loyalty, I don't blame Mr. Griffiths for leaving...
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quote #7
32
 tigerton...
1 month ago
the property which included a home and commercial premises would have returned $500 a week
That $500/week alone would have been more than enough to pay an $80,000 mortgage.
236
quote #8
20
 bcgrote
1 month ago
« tigertony : That $500/week alone would have been more than enough to pay an $80,000 mortgage.
That alone implies that there is another reason for denying his loan - why wouldn't they accept the property as collateral?

But then, if he has a HUGE amount in the bank, taking out a loan seems odd as well. Buy the property outright, and get that income, or try another bank or loan agency using the bank account and/or property as collateral... He has options.

A friend says most people right now can't even GET any home loan without credit in the 850 range... She may be full of it, though...

Very strange story. Another example of how the banks are shooting themselves in the foot, then getting gov't healthcare for it?
89
quote #9
44
 maven
1 month ago
There are a lot of reasons why having a mortgage is a good thing. Improves credit, for example, and in the states, there's a nice tax break on the interest. He wanted the mortgage, and having money in the bank is usually a better reason for the bank to willingly loan you money, not the other way around.
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14
 shuallyo
1 month ago
This guy rocks. I did the same thing at 5/3 bank... only a much smaller amount
73
quote #11
6
 qpon
1 month ago
Wow, I wish I could give this guy a hug, a modern day hero.
64
quote #12
21
 drogue
1 month ago
« maven : ...having money in the bank is usually a better reason for the bank to willingly loan you money, not the other way around.
If only that idea could have taken hold during the rise of the subprime bubble. It could have helped.
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quote #13
51
 suebe
1 month ago
While it certainly helps to have a nice chunk of change in the bank, that's not the only criteria banks go by when lending.

I'm surprised the rental income wasn't taken into account. And his 25 year history with the bank.


Who knows. I think there are missing pieces here. It's a pretty one-sided account.
23
quote #14
13
 Kevertje
1 month ago
« bcgrote:That alone implies that there is another reason for denying his loan - why wouldn't they accept the property as collateral?

But then, if he has a HUGE amount in the bank, taking out a loan seems odd as well. Buy the property outright, and get that income, or try another bank or loan agency using the bank account and/or property as collateral... He has options.
Quite simple:

He wanted to buy a $385,000 property in Mapua, had $200,000 in cash and was going to sell his $110,000 campervan.
He has 200k savings, can raise another 110k from the van which gives him 310k. So he needs the 80k loan for the property.
106
quote #15
49
 2manyuse...
1 month ago
throwing a tantrum, whining to the media, and demanding $20 bills? Childish.


No one, not artists, wait help, commission sales, drivers, or any of the bazillion other jobs that have irregular pay are punished by the bank.

The bank takes an average - usually over a 2-year period to get a monthly income figure that they use to determine income ratio.

If you don't have a 2 year history there will be problems as there should be. If you have no idea how much you'll make from month to month, the bank needs to see enough history to get a feel. Just because you had a killer few months doesn't mean that you'll make nothing over the next year.

It is the same with other jobs as well. If you make a lot of overtime, you will need to prove a history of overtime to count it as income. The bank can not grant a loan assuming that the overtime one made in a few months will continue for the life of a 30-year mortgage. If there is a long history of overtime earned, then there is a greater likelihood of continuing overtime

I love how everyone hates the bank for being prudent with their investors' money. If they had given the guy a loan and he was unable to pay because his art didn't sell, these same bank-haters would be blaming the "evil greedy bankers" for "tricking" him into a loan he couldn't afford.

The bank needs to and is legally required to look at everything. The bank is forced by law to show that the man will likely be able to pay. His past history of payments made is one factor, but just one. He also needs to show the ability to pay in the future.

It is apparent that he was denied because he couldn't prove enough income to make the payments. Why is it wrong for the bank to deny such a loan?
140
quote #16
44
 maven
1 month ago
That's true in one sense, but not true in another. I worked as a waitress for years. The banks did not take into account the money I made in tips, even though it varied less than $20 per month, because it wasn't income I could prove. They just looked at my pay stubs, which was just my hourly wage of $2.13.

I don't say that the bank was wrong in this case, just saying that he's well within his rights to leave a bank that he doesn't think is meeting his needs.
67
quote #17
49
 2manyuse...
1 month ago
« maven : That's true in one sense, but not true in another. I worked as a waitress for years. The banks did not take into account the money I made in tips, even though it varied less than $20 per month, because it wasn't income I could prove. They just looked at my pay stubs, which was just my hourly wage of $2.13.

I don't say that the bank was wrong in this case, just saying that he's well within his rights to leave a bank that he doesn't think is meeting his needs.
I have never heard of such banking decisions in all the 20 years or so of mortgage experience.

I have sold homes to a number of waitresses.

They will only count they tips the wait help claims and not the tips they actually make :)

Also, there is the problem of needing a 2-year history (usually). The bank needs to average out the tips earned over 24 months to get a monthly figure to use. If one is new to waiting tables then there won't be a history and the bank has no way to determine how much tips will be likely to be earned over the long term.
65
quote #18
44
 maven
1 month ago
This was for buying a car. I'd been waiting for about 18 months, but had a regular hourly wage before that, and I reported ALL my tips. I paid taxes on them so I didn't end up having to pay taxes on my investment income. I was a kid, and didn't argue with them, but it was enough of an issue that I had a really crappy interest rate. When I asked why, that's what I was told.

*shrugs*
104
quote #19
49
 2manyuse...
1 month ago
« maven : This was for buying a car. I'd been waiting for about 18 months, but had a regular hourly wage before that, and I reported ALL my tips. I paid taxes on them so I didn't end up having to pay taxes on my investment income. I was a kid, and didn't argue with them, but it was enough of an issue that I had a really crappy interest rate. When I asked why, that's what I was told.

*shrugs*
That's f'd up.
I would bet anything that you were lied to. That they took advantage of you because you were young, a woman, and the fact that they were a car dealership.

If the income was a problem, you'd have been denied, not given a higher interest rate.

Definitely unfair and most likely illegal.
75
quote #20
44
 maven
1 month ago
And...almost 15 years ago, so not much to do about it now. :)
21
quote #21
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