Rational Logic

Scenario
Abandon Service Apartment for the past 7 years (estimate) as of this writing. “black-listed” in CCRIS & owe the bank RM 55k in interest.

Blessing in disguise perhaps? Never had a car loan cause couldn’t get one.

Fortunately, the property is revive and was build-up pretty well IMO. Probable because the property is sitting in prime commercial land.

Solution
Call up my bank financier for this abandon property. Told them it’s now alive and kicking. Request for 100% interest waiver although it’s unlikely that will happen.

Ding-dong here and there thru couple of phone calls with the credit officer.
Credit officer mention will try waiver ranging from 10% – 50% but no promises.
Eventually, receive feedback from bank with virtually “zero” waiver and ask to pay up.

Wrote an email directed to Bank Negara and CC Bank customer-service.
All $ amount is fictional & names removed but the letter content remains about the same.

Sample

With reference to the above subject, we would like to appeal to Bank Negara to assist  and issue a letter to <bank name>, Kuala Lumpur  to waive the interest charged for nearly 6 years due to the abandoned project by the developer, <Developer> Sdn Bhd. The above mentioned interest does not cover the amount in the principle loan and instead is an additional interest charged.

We have stopped paying the bank since August 2002 due to financial constraint. We have written to the bank twice and went to see the loan officer to waive the interest but the response is not encouraging.

The bank officer informed us that the interest alone for the past 6 years is around RM55,000.00 and we still owe the bank the principal amount around RM82,0000. Beside this we still need to top up 20% (RM18,580.00) for the revival of the project by Price Water House. We really faced difficulty in settling the amount since we have other commitments.

This situation we faced is due to the developer’s fault for abandoning the project and  buyers should not be charged and we hope Bank Negara will help us to waive the interest.

<Bank Name 1>,<Bank Name 2> & <Bank Name 3> had waived the interest after the buyers had approached them, and from the website of Mr Lee Hwa Beng, we know that Datuk Ng Yen Yen had a meeting with Bank Negara recently regarding the waiver of interest for the buyers involved.

We hope  to hear from you regarding our request soonest possible since the project has been completed recently and in order to get the keys we have to settle the outstanding amount owed to <bank name>

What’s the outcome of this email appeal?

A mail from the bank’s lawyer giving waiver of late charges of about RM 3.7k ……
Obviously that ain’t gonna cut it.

Apparently the bank officer call-up not sounding too happy that an email was sent to Bank Negara….
But heh!…  The wavier you appeal for me is ridiculous.

Send a “counter-offer” email.
Sample…
 

This is in response to <bank name> letter titled “Appeal in Respect of Abandoned Housing Project – <property name>” dated 16 April 2008.

Below is <bank name>’s offer base on the original loan amount of RM 84,800.00 (Acc # x-xxxxx-xx)
Balance (30/04/08)                   = RM 135,919.61
Add Unreleased claim               = RM     4,640.00
Less upfront payment                = RM   20,000.00
Less late charges rebate            = RM     3,798.89
RM 116,760.72
Interest Rate (15 years loan)    = BLR + 0.28% per annum

Based on the above, it means that the “Total Interest”<bank name> charges us is RM 51,119.61 in a period between 5-6 years (# years since house project was abandoned)
It’s unfortunate that the above proposal by <bank name> shows “little or no attempt” in easing the plight of the customer who is already faced with an unfortunate event of an abandoned project.

Late charges rebate of only RM 3,798.89 and an interest rate reduction which was not even lower than the average housing interest rate published in <bank name> website (example BLR-1.65%) proved the above point.
We urge <bank name> to approach this case with a “Real Attempt” to reduce your customer’s burden.

Here’s our proposal which we believe <bank name> can accept
Balance (30/04/08)                    = RM 135,919.61
Add Unreleased claim                = RM     4,640.00
Less upfront payment                 = RM   10,000.00
Less late charges rebate             = RM     3,798.89
Interest Waiver 50%                   = RM   25,559.80
= RM 101,200.92
Interest Rate (30-year loan)       = BLR – 1.65% per annum

We also suggest the following for us to work together more efficiently.
1) Please provide me your direct email address so we can work through this at a faster rate.
2) We received <bank name> letter on 22nd April asking for our response by 24th April.
Appreciate either <bank name> courier letters to us or provide more lead time for response.

We are not here to demand but to ask for an appeal from the <no.> largest bank in Malaysia with an asset totaling RM111.6 Billion.
From a ROI point of view, what’s a couple of millions set aside to help common Malaysian buyers like us & others to gain a customer caring image for your bank.
If you’re not in the position to accept our proposal, we would appreciate you refer it to the right person.

Outcome from this 2nd email appeal?
Didn’t exactly get the 50% interest waiver … but it is close. RM 21k.
Deal accepted.

I applaud the bank on willing to waive this significant amount of interest.
Feedback I got is this sets a new precedent and it never or hardly ever happen (at least to us common folks). Perhaps thanks to the politicians who lobby for us? I like to think so.

Either way, I gain respect for this bank in their ability to reason with their customers.