He repaid the money by the deadline and then asked the bank about switching from a floating-rate to fix-rate loan, which would have resulted in lower repayments. However, the bank said it would have to monitor his repayments for 90 days before considering the request. It said it had told him about this stipulation, but Cory’s memory of the conversation was that the bank had merely told him he couldn’t apply for a fixed-rate loan while in arrears. Cory said that, had he known this, he would have put the money used to clear the arrears towards renovating his home in preparation for a voluntary sale, rather than the forced sale the bank had mentioned.

Cory rang the bank’s contact centre numerous times about his predicament, each time becoming a little more exasperated by his inability to get the help he needed. Eventually, he lost his temper and became abusive towards call centre staff, whereupon the bank said it intended closing his accounts.

Cory complained that the bank treated him unfairly when he was facing a difficult situation.

Our investigation

We found that the bank’s notes of the original conversation during which it mentioned the 90-day monitoring period were not specific enough for us to say whose recollection was correct. To add to our difficulties, the bank had not kept recordings of Cory’s phone calls with lending staff, although it had kept recordings of his calls with call centre staff. These revealed that Cory had indeed become increasingly angry as he was passed from person to person and the conversations became more and more circular. We considered Cory’s language and tone were unacceptable, and the bank’s decision to close his accounts was reasonable.

However, Cory’s history of arrears – including his current arrears – meant he would have considerable difficulty finding another bank, so we suggested the bank offer to put up to $4,000 towards renovating Cory’s home in preparation for its sale, with any left-over money going towards his arrears. We also suggested the bank make a payment of $500 to Cory, and in return Cory would pay a nominated amount each week to slow his growing arrears. In this way, Cory could avoid a mortgagee sale of his home.

Outcome 

The bank put this offer to Cory, and he accepted it.