The interest on the loan was fixed until November 2022 and then reverted to the variable interest rate. With the property not yet sold, Elora asked the bank to refix the loan’s interest rate. The bank declined to do so, although in May 2023 it changed its mind after the Official Assignee told the bank it was agreeable to this. Elora complained that the bank failed to tell her in November 2022 that it could refix the loan with the Official Assignee’s agreement. Had she been told this, she said, she would have pressed the Official Assignee to give its agreement. She asked the bank to compensate her for the higher floating interest she had to pay in the meantime. 

Our investigation

We reviewed the bank’s correspondence with Elora and the Official Assignee. We found that the bank had told Elora the interest rate could be fixed if the Official Assignee agreed.  We also found that the bank sought the consent of the Official Assignee at the time and then advised Elora that the Official Assignee had not agreed to this.  This consent was necessary because the joint loan was severed when her husband was adjudicated bankrupt, and a half share in the property was transferred to the Official Assignee. We found the bank was under no obligation to repay the extra interest she paid between November 2022 and May 2023.

Outcome

We did not uphold Elora’s complaint.