How I saved RM 14,451 from bank’s refinancing mistake

This is my existing loan offer letter back in Dec 2010 from Bank A.

Total loan = RM 321k, SPA only signed by Q4 2011 due to developer wanted to launch an adjacent residential condominium block.

Mortgage repayment started in Sept 2014 after Vacant Possession

loan offer letter lcf original

In June 2015, I decided to refinance only the outstanding portion of my loan.

Below is the redemption statement I got from Bank A. My outstanding balance is RM 319k only, but I need to fork out an extra RM 17k (337 – 321).

loan redemption statement lcf

Feeling something is not right, I checked further and discovered the breakdown is as below

  • Contingency fees = RM 3,162
  • Zero Entry Cost Chargeback = RM 4,817
  • Settlement Penalty = RM 9,634

loan redemption details

The question is – why is the penalty clause applicable here?

loan offer lockdown period penalty clause

Note: Some people may think the lockdown period is 3 years from the date of signed loan offer letter. This is normally not the case. It is counted from the date of first disbursement by the bank to the developer, which might be later (it usually is). In my case, upon checking with the bank, it is in May 2012. In spite of that, the 3 years lockdown should have ended by May 2015, and I should not be penalized for 3% of the outstanding loan amount.

Therefore, I submitted the “appeal” – which is a politically correct term for bank’s mistake in blindly penalizing me.

The revised redemption statement is as such at RM 322k – no more penalty fee and also waived zero entry cost charge back.

loan redemption statement revised no penalty

Lesson learnt: Two words – Caveat Emptor!

2 thoughts on “How I saved RM 14,451 from bank’s refinancing mistake”

  1. Hi CF, i also faced the same issue now with Maybank. Already over lock in period. LO signed on year 2012 MBB islamic financing. now refinance process, redemption statement show i also kena this contingency fee.

    So how do you write in ? is it by yourself or lawyer draft and write in ?

    How long does the process take place and do i need to call the bank to clarify this to expedite the process?

    1. no need lawyer la
      have you checked date of first disbursement by the bank to the developer, which might be later than LO signed date?

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