<TABLE border=0 cellSpacing=0 cellPadding=0 width="100%"><TBODY><TR>$3k penalty for redeeming loan that came with $1k rebate
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<!-- START OF : div id="storytext"--><!-- more than 4 paragraphs -->I SOLD my three-year-old car early last month as I was going overseas at the end of the month. During the settlement of the outstanding loan with DBS Bank, I was quite surprised at the settlement amount which was higher than I expected.
Hence I asked for a statement which I received on Sept 18. I was shocked when I noticed a 'clawback charge' of more than $3,000, and called the bank on Sept22 to inquire about this.
I was told that this charge was due to early redemption, as I had taken a cash rebate of $1,000 with a tie-in period of three years. I replied that since I had bought the car in September 2006, and made the last instalment payment in August 2009, I should have fulfilled the three years.
However, the bank told me that although I had bought the car in September 2006, the loan began only in October and thus, I had fulfilled only 35 months and was one month short of three years.
I then asked if it was possible to waive the charge, and even offered to pay the penalty of one month of my instalment which amounted to $900. The bank said it had to check. And after my repeated calls, the bank finally replied on the evening of Sept 25 that it could not waive the charge as it was against its policy.
First, I am quite taken aback that the bank required four days to reject my request, if it was indeed a breach of policy. Also, I am shocked that a cash rebate of $1,000 can attract a charge of more than $3,000.
And even though I was just one month short of the period, and had offered to forfeit one month's instalment, the bank was inflexible. It does not befit the Best Asian Bank, and I will seriously reconsider before taking a loan from DBS again.
Gerald Lee
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<!-- START OF : div id="storytext"--><!-- more than 4 paragraphs -->I SOLD my three-year-old car early last month as I was going overseas at the end of the month. During the settlement of the outstanding loan with DBS Bank, I was quite surprised at the settlement amount which was higher than I expected.
Hence I asked for a statement which I received on Sept 18. I was shocked when I noticed a 'clawback charge' of more than $3,000, and called the bank on Sept22 to inquire about this.
I was told that this charge was due to early redemption, as I had taken a cash rebate of $1,000 with a tie-in period of three years. I replied that since I had bought the car in September 2006, and made the last instalment payment in August 2009, I should have fulfilled the three years.
However, the bank told me that although I had bought the car in September 2006, the loan began only in October and thus, I had fulfilled only 35 months and was one month short of three years.
I then asked if it was possible to waive the charge, and even offered to pay the penalty of one month of my instalment which amounted to $900. The bank said it had to check. And after my repeated calls, the bank finally replied on the evening of Sept 25 that it could not waive the charge as it was against its policy.
First, I am quite taken aback that the bank required four days to reject my request, if it was indeed a breach of policy. Also, I am shocked that a cash rebate of $1,000 can attract a charge of more than $3,000.
And even though I was just one month short of the period, and had offered to forfeit one month's instalment, the bank was inflexible. It does not befit the Best Asian Bank, and I will seriously reconsider before taking a loan from DBS again.
Gerald Lee
