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LMI - misrepresentation of purpose. Genworth fail to produce their copy

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I've just browsed through documentation from the LMI. 

No sign of the additional LAF documents or LSC.

The original LMI was with GE. Now it's with a different company. Surely when it changed companies something should have been sent to me as the borrower? How about "Terms and Conditions", contract documents, etc? 

Would this tendency of credit providers like banks to change insurers and not let me know what the changes to the conditions etc are come under Insurance Act? Insurance Ombudsman?

I checked my loan documents and I can see where the LMI premium was paid on the loan statements.

I have yet to find out what the time limit on claiming for hardship - plenty of equity left in security property.  COSL mentioned that as well.

As well we seemed to be paying a higher interest rate than the standard rate for that lending product.


Mortgage Insurance Proposal

The purpose of the loan (refinance) is stated on the Mortgage Insurance Proposal as: Owner Occupier - Regulated.

The loan is in both names and on my Loan Application I stated my address, which is different to the security property.

At the time of application completion by both borrowers the "security property" was a block of land (all bar $20,000 of the property value in land) and the dwelling was elsewhere. Not sure when they thought the property (Lot number on title) would be "owner occupied".

As well the lender required a Declaration as to Purpose of Credit which we both signed for the loan in whole or in part business/investment. There was a warning on the document that this could mean that we would lose our protection under the consumer credit code. I understand this to mean it's potentially an unregulated loan - is that correct?

Is it acceptable practice for the lender to state something incorrect on the Mortgage Insurance Proposal?

I get the impression that the lender made a fair bit of extra money out of us through this loan ...

 EDITOR:  Newsflash,  LMI was a is hardship, more shortly.  GE also used service calculators to "test" affordability so how come they slipped up as well?  Why did they not send you their copy of the LAF and why not send copy of THEIR SERVICE CALCULATOR that LMI used to ascertain affordability?

What dogs they are

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  • Denise
    Denise Monday, 03 September 2012

    LMI was a is hardship, more shortly. GE also used service calculators to "test" affordability so how come they slipped up as well? Why did they not send you their copy of the LAF and why not send copy of THEIR SERVICE CALCULATOR that LMI used to ascertain affordability?

    What dogs they are

    [email protected]

  • doyla66
    doyla66 Monday, 03 September 2012

    Thanks, Denise. I'm going back to Genworth to ask again if they have the LSC or their service calculator. Of even GE's calculator to test affordability. That's what they should have done when they took it over from GE. Sounds like Genworth did a 'Mortgage Choice' - bought a bag of Lemon Loans.
    I ran the Genworth service calculator over my application: according to my calculations my borrowing capacity for even half the loan in question was $0. Adding that to Johnno's proven lack of ability to service the loans at the time of refinance ("swap" repayments for both using lender's money) I can't see how the lenders are going to make this refinance stick at all.
    It's looking promising ...
    I may have more leverage to get them to simply swap the titles over now without argument and the usual valuation nonsense - and hopefully no fees either.
    Now what's the bet they want to write it off before the Storm cases go through?

  • doyla66
    doyla66 Tuesday, 04 September 2012

    Interesting ....
    "... nurse the banks through while the government nationalises the mortgage insurers and shovels your money into a back door bailout. We’d come out the other end with utility banks, cheap houses, lower wages, and a radically diminished real exchange rate driving new investment."

  • doyla66
    doyla66 Tuesday, 04 September 2012

    US(2012)Genworth caught illegally funnelling $billions(re-issuance)back to originator/banks(@ hyper-rates) effective "kick-back"; Any? _ illegal "bank-channelling" of insurance premiums to AUS Banks? under the guise of "reassurance"? _ operating "down-under" ????????

  • doyla66
    doyla66 Tuesday, 04 September 2012

    Quite likely, Andy. My gut feeling is yes.
    Reassurance - like another back door bank bailout. Banks want it from everywhere! Poor little banks :(
    No doubt they'll expect babysitting and hand holding through the next financial crisis as well.
    The place is upside down when illegal fraud banksters get a helping hand and impoverished, defrauded, cheated and lied to financially stressed homeowners are lucky to get Centrelink or even anyone in the public service to believe them or answer their questions.
    Experience is a powerful teacher. Suggest the bank CEOs do their "bit" for society and live on Centrelink for a year while donating their salary to community service agencies.

  • doyla66
    doyla66 Tuesday, 04 September 2012

    or BFCSA so we can start to clean up the havoc caused by their excess!!!

  • doyla66
    doyla66 Tuesday, 15 January 2013

    Dear All,

    I am preparing a submission to the FSO to reclaim LMI as I repaid a mortgage after 2 years. The CBA says they won't pay anything back of the $20K I paid. I beg to differ as there are no terms and conditions on the mortgage about this and no clarity on who I paid. I am keen to get a paper trail of where the money went and get back a proportional amount. ie. 9o% of it that was unused for 18 years not used of a 20 year mortgage.

    Has anyone else chased a refund this way?


    Robert Harwood

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