Customers angry as ME Bank amount they can withdraw

ME Bank has slashed the amount an estimated 20,000 customers can redraw from their home loans by thousands of dollars, drawing outrage from borrowers hoping to use the money during the coronavirus crisis.

A spokesman for the bank, which is owned by a group of industry super funds, said it made the move after figuring out that “the redraw facility of some legacy home loans could lead to some customers falling behind their original repayment schedules”.

Home loan repayment facilities allow borrowers to repay additional mortgages and can either use the money to repay their loan faster or withdraw cash later.
Customers who have been flooded with the bank’s Facebook page with complaints seem to have been surprised by the move.

"One of the things we lost was my husband's redundancy payment because he was reinstated last week," said a customer in a post on this page last week.

The customer said his rebuild limit had been reduced to "more than 16 16,000".

“We were not eligible for centralized payments and they were dependent on funding through us,” he said.

Another said his limit had been cut to 20,000 with "no notice".

“There’s actually no contact,” he said.

"Luckily I don't rely on that amount for future purchases, but how do you know? I've been a loyal customer for more than 20 years and I'm ahead of the necessary payments.

Some clients say they have taken their complaints to the Australian Financial Complaints Authority. An AFCA spokesman said authorities could not comment on specific cases.

ME Bank did not answer questions about when the problem was discovered, when it was changed or what was usually a reduction in reconstruction.

A spokesman said about%% of home loan customers had been affected by the change. This is equivalent to a modest 20,000 loans based on the number of home loans published in the bank's recent annual report.

“ME is in the process of communicating with affected customers,” the spokesman said.-Internet

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