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Daniel
Daniel, Solicitor
Category: Australia Law
Satisfied Customers: 3456
Experience:  Bachelor of Laws (dist) Graduate Diploma in Legal Practise. Admitted NSW Supreme Court / High Court
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In early 2006, we took out a reverse mortgage with Bluestone

Customer Question

In early 2006, we took out a reverse mortgage with Bluestone Equity Release for $60,000 ($30,000 up front and $30,000 over ten years in monthly payments.) We foolishly chose a fixed interest rate of 8.59%. At our last statement we owed $85,000. That is now probably over $90,000. We want our children to pay the debt and we will sign the property over to them. In checking Bluestone's paperwork, it would appear that if the loan is finalised while we are alive or not in an aged care facility, Bluestone expects ALL future unaccrued interest payments to be paid as an exit fee. We thought exit fees had been abolished?. This seems unfair considering the amount of interest we have paid at a higher rate. It is also discriminatory because those who have chosen a flerxible rate are not hit with these charges. We would be grateful for any advice. Yours Sincerely XXXXX XXXXX

Submitted: 1 year ago.
Category: Australia Law
Expert:  Daniel replied 1 year ago.
Hello

You are correct, exit fees have been banned.

I would strongly suggest going to the financial ombudsman and filing a complaint.

This is clearly unconscionable conduct and they will be reprimanded.

http://www.fos.org.au/centric/home_page.jsp

Please accept.
Customer: replied 1 year ago.
We took out the reverse mortgage in early 2006. Does the banning of exit fees go back to this date or only from the legislative date?
Expert:  Daniel replied 1 year ago.
My sincerest apologies, i misread the question.

I had thought you mortgaged after that date.

Exit fees were only banned in 2011, thus your mortgage is still subject to it.

I would still speak with the ombudsman, as it seems extremely unfair regardless.

Also, there is a need to see how you entered into the agreement, perhaps without legal advice and the like.

Please accept.
Customer: replied 1 year ago.

Dear XXXXX


It was disappointing you misread the question. I had my hopes up with your original answer. I thought we were home. Then to hear we are still liable for the mammoth exit fees - that was disappointing, to say the least.


Yours Sincerely


Herb

Expert:  Daniel replied 1 year ago.
Hello

I am sad that i upset you.

It is a horrific situation to be in and i apologize.

My advice is sadly correct and i cannot give you better advice.

I answer a lot of questions each day and i simply misread it.

All the best in your endeavors, I trust my advice will be helpful with respect of speaking with the ombudsman.
Daniel, Solicitor
Category: Australia Law
Satisfied Customers: 3456
Experience: Bachelor of Laws (dist) Graduate Diploma in Legal Practise. Admitted NSW Supreme Court / High Court
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