# Forum More Stuff Debate & Technical Discussion  More complaints

## Bros

I can't understand people borrowing this much money and not knowing what you are doing. I wonder if they are being lured in by the sprukers saying that have 10 properties before they are 30 to promote their book sales or some other money making scheme they have and think they can join them.  
When things go wrong they are winging when things go well they are laughing. All investment has risks and you have to be aware of the risks and act accordingly not blame someone else. 
I know the banks lack trust but I wonder if the problem is in large part by the borrowers themselves. 
There is the old saying and it is still true "a fool and his money are quickly parted"  Westpac lends $1.6m to couple &#039;earning a very modest living&#039; in possible breach of lending laws - ABC News (Australian Broadcasting Corporation)

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## Bedford

> "I guess the brokers got their money, the banks were happy, they've got  what they want, and at the end of the day here we are renting," Mr Tate  said.

  Need to see what the Broker presented to the bank.............

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## r3nov8or

"...and when they saw media coverage of the banking royal commission they decided to look into their loan documents." 
A little too late, don't you think?

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## Smurf

How can an ordinary person do _anything_ involving $1.6 million without fully understanding it and seeking independent professional advice if necessary I just don't get. Sure if you're Bill Gates or Warren Buffett or someone like that then $1.6 million will be of no real concern (though such people still wouldn't throw it away) but for any average person it's a huge amount. 
Blaming the banks is a bit like blaming the manufacturer of a car because someone chose to drive it straight off a cliff and is now seriously injured.

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## chrisp

I think that there are three topics here:
(a) banks and their lending practices;
(b) property investment / wealth spruikers; and,
(c) investors who only want the gains/wins (and who want to socialise their losses). 
With regards to banks and their lending practices, hopefully the Royal Commission will expose any questionable practices. However, providing that the paperwork is correct and in order, the borrower does need to take some responsibility. It’s all good to say that the bank overlooked x and y, but in the end they would have signed an agreement to pay back a loan at a specified rate. If they couldn’t afford it, they shouldn’t have signed. 
Regarding property/wealth spruikers. They are parasites on society and anyone dealing with them beware! I certainly wouldn’t hand over any of my money to them. 
Then there is the age old issue of investors who cry poor when their investments turn in to a loss. I wonder how many would offer to share their riches if their investments turned in to an unexpected windfall - probably none. They’d claim that their riches are the result of their ‘hard work and shrewd investment decisions’ and complain about paying their taxes. But when it turns to a loss, it becomes the fault of others. As long as the investors weren’t deceived, I have no sympathy for their losses.

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## r3nov8or

Maybe all legal papers will one day have a label stating "Caution: Contents May Cause Bankruptcy"  (I'm sure you get the McDonald's Coffee analogy)

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## pharmaboy2

In the share market, they have proper types of investor, eg sophisticated, professional .  You can’t  just write any old product up for someone off the street, you are restricted and can only sell to certain types of investors certain products.  Realistically, the real estate industry should have similar standards and same for banks. 
try opening up a 1m margin loan facility with a broker, then compare that to buying real estate.

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## Marc

A bit of fake news from the Anti Boys Chanel to appeal to the lefties.
1.6 m for 4 properties using your own home as security is a conservative loan. Real estate is a long tern investment and many don't have the gonads to weather the storms that invariably come your way. Those two morons are opportunist who most probably made a string of errors and may have overspent on 'renovations' or renovated their own home and claimed it on the rentals who knows. They saw the royal commission findings, we all knew for decades, and thought the bank will write their loan off. Good luck.
Chrisp ... Making money is immoral, selling properties is immoral, investors are parasites ... never contemplated moving to Cuba? No issues with property investors there.  https://youtu.be/JNYOVEXJBBM

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## chrisp

> Chrisp ... Making money is immoral, selling properties is immoral, investors are parasites ... never contemplated moving to Cuba? No issues with property investors there.

   :Confused:  I have no idea what you are on about.

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## UseByDate

> A bit of fake news from the Anti Boys Chanel to appeal to the lefties.  https://youtu.be/JNYOVEXJBBM

  I see your Anti Boys and raise you Bad Girls. https://www.youtube.com/watch?v=rMcEwaGz_64

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## Marc

Ha ha Use ... the ABC is called the "anti boys channel" because of their pathetic stand against men in general, particularly white middle aged with money. 
That you tube was meant to be a dig into Chrisp's leftie rant and represents the magical kingdom of Cuba where everyone is equal and everyone drives 1954 cars. 
No bad rich parasitic investors there.

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## toooldforthis

> I think that there are three topics here:
> (a) banks and their lending practices;
> (b) property investment / wealth spruikers; and,
> (c) investors who only want the gains/wins (and who want to socialise their losses). 
> With regards to banks and their lending practices, hopefully the Royal Commission will expose any questionable practices. However, providing that the paperwork is correct and in order, the borrower does need to take some responsibility. It’s all good to say that the bank overlooked x and y, but in the end they would have signed an agreement to pay back a loan at a specified rate. If they couldn’t afford it, they shouldn’t have signed. 
> Regarding property/wealth spruikers. They are parasites on society and anyone dealing with them beware! I certainly wouldn’t hand over any of my money to them. 
> Then there is the age old issue of investors who cry poor when their investments turn in to a loss. I wonder how many would offer to share their riches if their investments turned in to an unexpected windfall - probably none. They’d claim that their riches are the result of their ‘hard work and shrewd investment decisions’ and complain about paying their taxes. But when it turns to a loss, it becomes the fault of others. As long as the investors weren’t deceived, I have no sympathy for their losses.

  pretty much this.
except the RC bit - nothing new exposed there.
amazing how govt's and vested interested have kept a lid on it for so long.
whoops - answered my own question. vested interests. 
ps: Marc, I can't see any leftie rant in there?

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## METRIX

Anyone borrowing 1.6M has to have some sort of common sense as to the implications if things go even slightly bad, lose a renter, lose two renters, possibly renter damages a property that puts it out of action for a while.
Interest rates go up by .5 or 1% and all of a sudden their shyty income won;t cover the repayments. 
Come on people take responsibility for your actions, real estate is just gambling, the quicker you understand that the better decisions you make because you don't take it as a given, there are no guarantees with real estate.
Irrespective if the bank loaned them more then they should have, the punters have to take onus of being greedy and thinking they were going to make millions from investment. 
I had to take risks over my last number of houses, but the risks were calculated, and would never put me in a position I didn't want to be in even if things went wrong, these people are just stupid, and want someone else to pay for their stupidity so they can go and be stupid elsewhere.

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## Bedford

> Maybe all legal papers will one day have a label stating "Caution: Contents May Cause Bankruptcy"

  Loan agreements do, known as the "All Monies Clause", A warning for every property investor seeking a loan direct from a bank - McCombe Finance   

> *The Banks Secret Weapon* 
>  Every loan agreement in Australia has an insidious clause called the _All Monies Mortgage Clause_ which is designed to provide the ultimate protection _for the lender_. The key provision is the _Adverse_ _Change in Circumstances_ clause which enables the lender to demand all loans be reduced or repaid if _it deems_ the borrowers circumstances have become less favourable than when the loan was approved.

  I think one can't make any judgement on these people from just one article, there is so much detail missing.

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## r3nov8or

> Loan agreements do, known as the "All Monies Clause", [...

  That doesn't read like my version  :Smilie:  , and it's not on the packet  :Smilie:

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## doovalacky

> A bit of fake news.
> 1.6 m for 4 properties using your own home as security is a conservative loan.

  In that particular case I have to agree. Taking out any loan you have to sign off on an expenditure list. Its not like they took the entire amount out at once so clearly they would have had a chance to get used to to the increased expenditure.  It's only common sense to build up a reserve to cover vacancies etc. 
It's the cases were the banks have suddenly demanded huge part or complete repayments of loans due to re-valuations etc that need investigation.

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## Marc

> In that particular case I have to agree. Taking out any loan you have to sign off on an expenditure list. Its not like they took the entire amount out at once so clearly they would have had a chance to get used to to the increased expenditure.  It's only common sense to build up a reserve to cover vacancies etc. 
> It's the cases were the banks have suddenly demanded huge part or complete repayments of loans due to re-valuations etc that need investigation.

  Correct. I never experienced that, but change of the goal post many times. I remember at one stage I had 9 properties with 3 different banks. The bigger one was with Westpac and at some stage they offered me to fix that interest rate at 4% for several years. i said no and the variable dropped even further and stayed under 4 for years. 
Next thing I get a letter saying that my interest only period had ended when in fact originally it was 12 years and only 7 years had lapsed. I didn't really care but I can imagine someone else getting in trouble with that.

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## Bedford

Here's a bit of commentary about this from Investors on Property Chat Forum,  https://www.propertychat.com.au/comm...r-spend.32706/

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## UseByDate

> pretty much this.
> except the RC bit - nothing new exposed there.
> amazing how govt's and vested interested have kept a lid on it for so long.
> whoops - answered my own question. vested interests. 
> ps: Marc, I can't see any leftie rant in there?

   :Iagree:  I can't see any leftie rant in Chrisp's post.

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## commodorenut

> ...... where everyone is equal and everyone drives 1954 cars.

  And that's a problem because ????   :Tongue:

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