A clause in credit agreements entered into before the National Credit Act was promulgated had provided for subprime interest rates to be increased to prime in instances of defaults, the bank said.
Standard Bank has agreed to refund a Johannesburg woman who says the interest on her home loans was quietly hiked after she fell into arrears and that, unbeknown to her, she was incurring massive overcharges as a result.
And the expert she roped in to help her says this is not an isolated case.
But Standard Bank says it always ensures charges on loans are debited “in line with the agreements concluded with the customer”.
The case in question – together with another, similar case in which the bank recently agreed to a refund – are simply “two examples out of thousands of accounts that have been reviewed over the past 12 months”.
“And in these two cases we opted to refund some interest charged on the loan accounts based on the individual circumstances of each loan,” spokesman Ross Linstrom said.
He said the bank could not share details of specific clients and their accounts.
He did, however, point out that a clause in credit agreements entered into before the National Credit Act was promulgated had provided for subprime interest rates to be increased to prime in instances of defaults.
“It is accordingly possible that the accounts that you have referred to have fallen into arrears and lost their interest rate concession, resulting in the accounts reverting back to the contract base interest rate,” he said.
Petra Janse van Vuuren fell behind on two home loans she had with Standard Bank during the global financial crisis in 2009. But she says she only realised recently her interest rates had been pushed up permanently as a result, even though she had long since caught up on the payments.
Janse van Vuuren and her husband own several properties that have been financed through different banks and she picked up that something was amiss when she started comparing the bonds.
“All the properties were bought in the same complexes and they were all in around the same price range,” she said. “But we were paying so much more for the bonds we had with Standard Bank”.
The interest rates on the two home loans were finally dropped again in September, after Janse van Vuuren contacted the bank.
And earlier this month, after she got private financial investigator Emarald van Zyl involved, Standard Bank agreed to refund her.
How much she will get remains to be seen but by Van Zyl’s calculations, Janse van Vuuren was overcharged by a staggering total of more than R182 000 over the course of the past 11 years.
Van Zyl said he had been involved in several cases like that of Janse van Vuuren and that in some of the most recent, he had calculated overcharges of between R78 000 and R398 000.
But while Banking Ombud Reana Steyn said her office had dealt with a number of cases involving various interest rate issues over the past year, she said they did not make up the bulk of their load.
She also said they involved different banks and that issues like this were in no way limited to Standard Bank.
“There’s not one bank that gets it right all of the time,” Steyn said.
She encouraged members of the public who believed they were being overcharged to first approach their banks and then, if they were still not satisfied, to lodge a complaint with her office – highlighting that their services were free.
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