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Ask Leon Your Own Question
Leon, Solicitor
Category: Australia Law
Satisfied Customers: 44191
Experience:  BEc Dip Ed, Dip Law (SAB) MTax (UNSW)
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CBA Bank day before

Customer Question

CBA Bank day before property settlement the bank informed us that they will take the full settlement proceeds to reduce our debt based on historical cash flow, this is despite us having been affected by drought & the fact that historical conversations involved us taking our overall debt down to the level of our overall LVR allowance. We've made commitments based on our anticipated proceeds of the sale & provided a forward plan demonstrating a positive cash flow within 2 years. The bank gave us 24 hours notice prior to settlement that this is what they intended. If we had not sold the property we had plans in place to meet our ongoing commitments. We had a 2 year loan agreement that expires next March, with our annual partial review(no cash flow requested),we'd in fact requested extra funding that that was within our LVRs, we in fact were managing without it, however it would have allowed us to have better profit outcomes. We have never missed a payment, the banks behaviour here will result in us defaulting on business agreements, forcing sales of unfinished livestock etc, it will jeopardise our future ability to increase our profits, because we have been dumped upon we have had no time to make alternate arrangements for such an outcome. We need assistance & quickly. Can they do what they have done.
Submitted: 2 years ago.
Category: Australia Law
Expert:  Leon replied 2 years ago.
Good Afternoon.My name is ***** ***** I am a NSW Solicitor. Thank you for your question, and will do my best to assist you with your question. Please understand this is not legal advise Please understand this is not legal advise but a guide to assist you.What do you owe the bank in total?
Customer: replied 2 years ago.
Expert:  Leon replied 2 years ago.
What is the sale price of the land?
Customer: replied 2 years ago.
Expert:  Leon replied 2 years ago.
In that case you have no choice. They have a right to collect the whole amount as the mortgage you signed gives them the right. What do you want to pay?
Customer: replied 2 years ago.
I can't see the relevance of the actual dollar values
Expert:  Leon replied 2 years ago.
I do not understand you last comment?
Customer: replied 2 years ago.
It may be best if I phone you
Expert:  Leon replied 2 years ago.
I have sent you an offer for additional services
Customer: replied 2 years ago.
I would be happy to pay $420000 which is the 60% security value
Expert:  Leon replied 2 years ago.
Good Afternoon, if you owe the bank an amount in excess of what the value of the property is, the bank is well within its rights to demand the full proceeds of sale after taking into account agency fees, adjustments for rates and levies and legal fees.Usually in mortgages it is clear that the bank has the right to collect all outstanding monies owed by the borrower and if the property was used as security for earlier loans then you cannot stop the bank from requesting the full amount.You can put an offer to the bank to accept a lesser amount, but the aware that they do not have to accept this as I no longer have any security once the property is released.If you are able to provide them with alternative security then they may agree.But in order to be able to make a valid argument you need to look at the agreements you have entered into with the bank for all borrowings to determine whether the property was used to security.I hope this makes things a little clearer?
Customer: replied 2 years ago.
Our other properties are within LVRs & cover all our other borrowings
I haven't really learnt anything I wasn't aware of, initially I thought I was contacting the banking ombudsman
Expert:  Leon replied 2 years ago.
Good Afternoon, The Ombudsman is at the following link will get you a refund
Expert:  Leon replied 2 years ago.
Good MorningI'm just following up our discussion earlier this week and seeing whether there is anything else I can assist you with. If I have missed anything, or you have any further questions please let me know. If there is anything else in the future please do not hesitate to ask. Please do not forget to leave positive feedback. I look forward to hearing from you. RegardsLeon
Customer: replied 2 years ago.
Of no assistance