Irate bank customer hits back. Withdraws $190,000 when turned down for loan.

[Desertdog]

I bet the bank didn't learn anything from losing a customer like this.

Irate bank customer hits back
http://www.stuff.co.nz/national/2667215/190-000-withdrawn-in-20-bills


Defiant Mapua artist Roger Griffiths today made a stand against Westpac by withdrawing his $190,000 savings in $20 notes.

The bank provided a red-and-black carry bag to take away the cash after meticulously counting it in front of Mr Griffiths at its Nelson branch.

Mr Griffiths, a loyal Westpac customer for 25 years, decided to withdraw his money after the bank rejected his application for an $80,000 mortgage. "It's about time normal people took a stand."

He said the bank turned down his application because he did not have a regular income as an artist. However, he was a successful artist, exhibiting his paintings at the World of Wearable Art complex, in Christchurch and New York, he said.

He wanted to buy a $385,000 property in Mapua, had $200,000 in cash and was going to sell his $110,000 campervan.

That more than met the bank's criteria for a 20 per cent deposit, and the property which included a home and commercial premises would have returned $500 a week, he said.

He was disappointed when his loan application was rejected, but it was Westpac losing $111 million to Lane Walker Rudkin Industries that tipped his decision to withdraw his money.

"They can lose $110 million with LWR but turn down a normal customer who has never missed a loan payment," he said. "If they don't have the trust in me after 25 years, there's a problem for Westpac."

Having decided to withdraw his money, he then decided to make it hard for the bank by requesting payment in $20 bills.

He said the Nelson branch told him it did not have that amount and he would have to also go to other branches at Stoke, Richmond and Motueka. However, he insisted the bank have the money ready to collect at 9am today. He then took it to the Nelson Building Society, saying he would rather deal with NBS because it was part of the community.

His message to Westpac: "If you don't support the community, the community won't support you."

Mr Griffiths' protest comes after a series of embarrassments for Westpac. On Tuesday its former Alexandra bank manager admitted defrauding the bank of more than $400,000, and it has been left red-faced over the slip-up that allowed $10 million to be wrongly credited to a Rotorua service station co-owner who had since fled to China.

Westpac media relations manager Craig Dowling said today that when the bank lent money it required certain information to be provided to enable that lending to be done prudently.

Ad Feedback "It's about providing evidence of an ability to meet regular repayments."

In Mr Griffiths' case that information was not provided for it to be assessed, he said. Mr Griffiths' withdrawal was disappointing.

"We would like to welcome Mr Griffiths back. We just need the confidence regular repayments can be met."

[K Frame]

I made a similar move once.

Not nearly as much money, but it made the point.

[Monkeyleg]

My bank is a small bank, very conservative in their underwriting rules. I've been turned down several times for loans, all because I'm self-employed.

I put $300,000 to $400,000 a year through that bank, but they turn me down almost every time.

I think I'll follow this guy's lead.

[Uncle Bubba]

A young woman I worked with years ago said her father did something like this to Wachovia Multi-Mega-National Bank. Long-time customer, several times what he wanted to borrow in the bank, and got turned down. So he took his money elsewhere. Ultimately that's the worst thing you can do to a business. If enough people do it, no more business. Unfortunately, not enough people do it to places like Multi-Mega-National Bank and Chase Mega-National-Multi Bank. The [sarcasm]sharp heads[/sarcasm] running those places think the multi-zillion-dollar deals they make with a few big companies is where they make their bucks when in reality it's the millions of the great unwashed putting their dollars in that drives the business.

[cassandra and sara's daddy]

I made a similar move once.

Not nearly as much money, but it made the point.

bet you liked that! i did it to chevy chase a while back  loudly discussing why in the lobby as i closed out dads accounts  then his wifes then lastly a trust fund i administer for my lil bro. i so poor if bowel movements were a nickle i'd have to vomit but the kin got money and for reasons that escape me they trust me with it. weird.  the bank manager hated me proclaiming that i wouldn't do business with a bank that won't honor good checks. i have a clause in my contract that precludes me being paid in a check drawn on them without a 50 buck surcharge

[RevDisk]

I did the same to Susquehanna Bank.  They bought out my small town bank I used since I was a kid and made deposits with a handful of change.  Ok...   Gotta love fine print.  Huge signs everywhere "FREE checking".  In exceptionally small print, "Subject to minimum daily balance requirement."   No mention of how small it is.  Digging through the website?  Need to keep $1,000 in your checking account, and can't dip below that overnight.  At an interest rate of .05%   

They also didn't care to hand me a piece of paper with all fees, rates, etc.  So I told them I'd like my balance in cash.  Anyone who would trust their money to a bank who hides the terms and conditions is a fool.  I wasn't loud and abrasive.  But I wasn't whispering either.  The tellers (who probably got a raw deal themselves) did not look displeased with my thoughts.

If you're doing business in or around PA, I highly recommend Fulton Bank.  If you can swing it, Pennsylvania State Employees Credit Union is good also.  Between the two of them, I have never had a single significantly bad experience. 

[K Frame]

I secon Pennsylvania State Employee's CU.

I had them as my primary financial institution when I lived there. I still have a Visa card from them and always check out their rates before I get a loan elsewhere.

My primary is now Navy Federal Credit Union.

With the exception of a savings account with NRA's cobranded bank (Waterfield) and a couple of credit cards, all of my financial services are handled through NFCU.

[GigaBuist]

I made a similar move once.

Not nearly as much money, but it made the point.

I know a bank that lost a business payroll account, the checking accounts of the 8 employees that the payroll went to, and a chance to bid on a roughly $1.2 million dollar annual credit line over a $35 overdraft fee.

[Brad Johnson]

He said the bank turned down his application because he did not have a regular income as an artist. However, he was a successful artist, exhibiting his paintings at the World of Wearable Art complex, in Christchurch and New York, he said.

Tough cookies. You no show-a da income, you no get-a da loan.

"Successful" or not, fancy-pants exhibits or not, no lender in their right mind (or that insures their loans, which all banks do) will lend to ANYONE who can't prove their income on paper. If your income is egregiously irregular, as artist's can be what with single large sales on an occasional basis, I suggest you be ready for lenders to give you the evil eye. If you don't like it, pay cash. The only other real option is to set up a corporation and pay yourself as an employee. That way you can show regular income.

Brad

[SADShooter]

Brad:

Is/should that true for historical deposits into the institution from which you seek the loan? I certainly understand skittishness with unconventional earnings, but they could obviously evaluate his financial history. Not challenging your assertion, genuinely quizzical.

SADShooter

[Uncle Bubba]

I'm with SADShooter on this one. Instead of relying on a book that says "Artist = irregular income = bad risk", how about using some brain power and evaluating the individual? Especially an individual who has $190,000 on deposit in that very bank?

It's the same stupid mindset that causes banks to demand (they say "request") two forms of I.D. if you want to cash a check on their bank but don't have an account. Stupid because they'll accept anything short of a note from your mother as I.D. When my wife and I were dating she wrote me a check - something less than fifty bucks - and I took it to her bank (BoA) to cash. The teller demanded two forms of I.D and I told her I carry one, a GA driver's license. She said, "Don't you have a work I.D.? A credit card? A Social Security card?" I replied, "No, no, and that's not a form of I.D. This is drawn on your bank, the money's in the account, cash the check." She said she would, this time, but next time I should have two forms of I.D. I told her that given the hassle I was getting this time I sincerely hoped there would never be a next time. And there wasn't.

[Desertdog]

He wanted to buy a $385,000 property in Mapua, had $200,000 in cash and was going to sell his $110,000 campervan.

Brad,
From the story, it looks like he was going to put about $300,000 down on a $385,000 house.  With this amount of equity they should have felt that he was not going to default on his payments.

[Brad Johnson]

Brad:

Is/should that true for historical deposits into the institution from which you seek the loan? I certainly understand skittishness with unconventional earnings, but they could obviously evaluate his financial history. Not challenging your assertion, genuinely quizzical.

SADShooter

The problem is the bank isn't making the loan. They are originating paper they will immediately sell to a third party. Mortages are traditionally to small a margin for banks to bother with. They originate it, sell the paper, and take the money so they can lend it in more profitable ways.

The underwriters have very specific criteria regarding income (even moreso lately, what with the new fed regs). If your income is not regular and proveable income, it doesn't exist in terms of qualifying for a loan.

If the bank IS making the loan, they will want to insure it some way. In that case the insurance company will have certain guidelines for how the income is documented. That gets you right back to "regular and proveable".

Brad,
From the story, it looks like he was going to put about $300,000 down on a $385,000 house.  With this amount of equity they should have felt that he was not going to default on his payments.

Has nothing to do with what they "felt". Has everything to do with his credit history (credit score) and PROVEABLE income (i.e. income documented by paycheck stubs, tax returns, or both). If his debt-to-income ratios or his credit history do not meet the minimum criteria for the loan, the lender isn't going to make the loan. Period.

Brad

[GigaBuist]

The underwriters have very specific criteria regarding income (even moreso lately, what with the new fed regs).
Brad

Let's keep in mind that this was in New Zealand, not the US.

[SADShooter]

Thanks for clarifying the process, Brad. That makes sense in a "sucks" sort of way. So, the upshot is: save your pennies and draw the questions flowing from cash, or join the drone swarm.

[K Frame]

No, what really sucks is that banks got themselves into this mess by being arseholes, and now they're being even bigger arseholes (or are required to be).

Oh, did I mention that I HATE banks?

Credit Unions all the way.

[Brad Johnson]

Let's keep in mind that this was in New Zealand, not the US.

Wouldn't suprise me if their lending regs closely mirrored those here in the states. Banks are international institutions. Short of certain county-specific regulatory things, banking rules and expectations are pretty universal.

Thanks for clarifying the process, Brad. That makes sense in a "sucks" sort of way. So, the upshot is: save your pennies and draw the questions flowing from cash, or join the drone swarm.

Cash isn't a problem if your finances are properly structured and you can prove uniformity and consistency of income. Cash becomes a problem when it suddenly appears out of nowhere.

Also, trying to use someone elses money will necessarily draw questions. Use the example above. Yes, the guy had $190k, but if that was everything he had then there was no cash reserves in case of an emergency (yes, lenders consider that). Sure, he was only getting an $80k loan on a $300k house, but did he have the income to service it? Chances are he didn't, or at least didn't have the consistency of proveable income needed to meet the loan criteria.

If I was a betting man I'd say the guy gets a big score every couple of years. That means he has plenty of cash right now, but no surety of income for the future. That will set off any lender's warning bell. Plus, artists tend to be a little sloppy in their business dealings. Day-to-day monetary management is drudgery to them, so it gets pushed aside until it can't be ignored. Artitstic types are just generally wired that way. It wouldn't suprise me at all if there was a host of money problems in his past.

Sorry, Mike, but I have to disagree. A credit union is still a bank. They just have different words on the sign and are slightly more discerning in their clientele. They still deal in money, albeit on a smaller and more personal scale.

Brad

[AmbulanceDriver]

Speaking of annoying problems with banks....

I had a problem with Bank of America one time.  I had been a customer of theirs for nearly 10 years at the time.  A teller made an error, and I didn't verify my receipt (which was my fault), and a deposit was made incorrectly.  An entire order of magnitude incorrectly.  Deposit of roughly $100, versus the check that was roughly $1000.  So a week or so later, I get 3 overdraft notices...  Hrm, says I, something stinketh.  Look at my deposit receipt, see what happened.  Head in to the local branch, copy of my deposited check in hand.  With the receipt showing the missing zero.  They corrected the deposit amount, but they refused to wipe out the overdraft fees.  Took it all the way up to the branch manager.  Still refused.  Wasn't yelling, but made sure the entire branch could hear that I would no longer be doing business with them, and why. 

So after everything else had cleared, I withdrew the remainger of my balance.  Well, almost all of it.  I left $0.12 in that account.  For 5 years.  I refused to go for the electronic statements when they implemented that.  So every month, for 5 years, they sent me a paper statement.  Between the postage, paper costs, ink, inserts, etc, I figure that it was costing them about 50 cents a month to mail me a statement.  Over 5 years, I figure it cost them about $30.  Oh, and I know it cost them other business as well, because I know of 3 friends that closed their accounts there because of what happened to me.  Did it make a huge impact on their bottom line?  No.  But it did give me a sense of satisfaction nonetheless.  :)

[gunsmith]

I once had the bank credit an extra paycheck when I had direct deposit, I pointed it out to them and they said
they would take it out in a few days.
I also asked if they would pay me a fine for their mistake as I would be charged for a mistake if I goofed.
Nope.

[Leatherneck]

Oh, did I mention that I HATE banks?

Credit Unions all the way.

Amen, brother. NFCU and PFCU are my only financial institutions, except for a small mortgage on the river property with a local Northern Neck bank. Just for the local aspect of things.

TC

[K Frame]

"Sorry, Mike, but I have to disagree. A credit union is still a bank. They just have different words on the sign and are slightly more discerning in their clientele. They still deal in money, albeit on a smaller and more personal scale."

No, credit unions are not banks. Either by legal definition or by practice.

What credit unions and banks are, however, are depository institutions that allow you to manage and control your money. It's there that the similarities end, both functionally and legally.

By law, credit unions are not for profit. Banks are for profit at the expense of the customer.

By law, credit union boards of directors are volunteers. Bank board members are often paid millions of dollars a year, plus millions more in stock.

In credit unions, the users are members. In banks, you're a customer.

Compare the largest credit union's fee structure with the largest bank's fee structure, and you'll see exactly where you rank as a bank customer -- as a center of potential profit to be drained as quickly and as ruthlessly as possible.

The list of tangible differences is a long one, and a very important one.

Case in point...

A number of banks in the DC area have been increasing their fees on electronic bill paying services by tightening up on the number of checks you can write a month, etc. Navy Federal a few years ago DROPPED its monthly fee for bill paying services completely.

I think it's also pretty damned interesting that over 50 banks have failed this year and have been closed by regulators, but so far only one member credit union has been closed that I know of.

Just because two things look similar dosn't mean that they're the same.

[lupinus]

Exactly, since joining a credit union I will never again go to a bank.

After my capital one fiasco my credit union was more then happy to issue me a card that covered both my cap1 cards balances, had a better interest rate, and by FAR a better fee structure.

I personally think for loans and such that's where they really excel.  The rates are typically better, but the fees are almost non existent in comparison.  I think the only fee with my CU that is no better then a banks is the fee for bouncing a check, which is understandable.

I will say some CU's do operate a tad closer to a bank then I like, such as my former very local credit union.  I have found the state one to be great though.

[thebaldguy]

Speaking of annoying problems with banks....

I had a problem with Bank of America one time.  I had been a customer of theirs for nearly 10 years at the time.  A teller made an error, and I didn't verify my receipt (which was my fault), and a deposit was made incorrectly.  An entire order of magnitude incorrectly.  Deposit of roughly $100, versus the check that was roughly $1000.  So a week or so later, I get 3 overdraft notices...  Hrm, says I, something stinketh.  Look at my deposit receipt, see what happened.  Head in to the local branch, copy of my deposited check in hand.  With the receipt showing the missing zero.  They corrected the deposit amount, but they refused to wipe out the overdraft fees.  Took it all the way up to the branch manager.  Still refused.  Wasn't yelling, but made sure the entire branch could hear that I would no longer be doing business with them, and why. 

So after everything else had cleared, I withdrew the remainger of my balance.  Well, almost all of it.  I left $0.12 in that account.  For 5 years.  I refused to go for the electronic statements when they implemented that.  So every month, for 5 years, they sent me a paper statement.  Between the postage, paper costs, ink, inserts, etc, I figure that it was costing them about 50 cents a month to mail me a statement.  Over 5 years, I figure it cost them about $30.  Oh, and I know it cost them other business as well, because I know of 3 friends that closed their accounts there because of what happened to me.  Did it make a huge impact on their bottom line?  No.  But it did give me a sense of satisfaction nonetheless.  :)

I did the same thing with a bank years ago. I had a checking account with First Interstate Bank just over a dollar in it. They wanted to charge me two dollars for a certified check to be mailed out to me. I told them to keep the account open as I would use it again soon. I made them send me statements for years. I would call them occasionally telling them to keep my account open. I made them spend over ten dollars in postage over several years before they finally wrote off my balance.

[thebaldguy]

Banks don't care about customers anymore. They got billions in bailout money without the hassles of customers. One big bank pays a yield of .05% on a savings account. They pay just over 1% on a one year CD. Unreal. And this bank got more than 40 billion dollars in TARP money. Screw them.

Yes, that's right. You give them $1000.00, and they give you fifty cents interest per year. Oh, and they have no problem charging 15%+ on credit cards and other loans. Remember that they got money to stimulate the economy, but they aren't giving out many loans, and they loans they give have very high interest rates.

Credit unions are the way to go. I closed an account at a bank to move to a credit union with much better rates. I asked for the branch manager as I had some comments for him. He explained that they couldn't compete with credit union rates. I politely told him that if they got rid of their numerous overpaid bigshots and their private jets they might be able to compete. He said there was nothing they would or could do. I told him that there was nothing I could do as I will not be ripped off by a badly run bank going downhill, and explained that I would spread the word that this bank sucked and they took TARP money.

The best part is that my credit union has an ATM agreement with my old bank so I can use any of their ATMs for free nationwide. Pretty funny.

[Brad Johnson]

No, credit unions are not banks. Either by legal definition or by practice.

What credit unions and banks are, however, are depository institutions that allow you to manage and control your money. It's there that the similarities end, both functionally and legally.

By law, credit unions are not for profit. Banks are for profit at the expense of the customer.

Okay, so it's a non-profit bank with membership privileges.  From the end-user standpoint the functionality is essentially the same. You put money in, borrow on occasion, and get money out when you need it (if, of course, you actually have any left after the gov gets hold of you every year).

Brad