Citizens Bank of Canada closing its LOC, wants everyone to pay up!

[bankerboy80]

I cannot see them calling the loan immediately. They can close it which means the credit facility is no longer available to draw on but regular payments are due. This would apply the same at any of the major banks. If you wanted to voluntarily close your line you could and still pay the minimum every month and be in good standing.

If they do not offer at the very least a scheduled amortization of atleast 5 years I would contact any of the following

http://www.obsi.ca/ - Financial ombudsman of canada

http://www.obsi.ca/ - Financial consumers association of Canada

 

[Mia.Colpa]

Loan is unsecured. I am not familiar with the area of collections (never had to and hopefully never will) but aren't they going to take his car (or repo his shit at his home) if it furthers to a collection agency? From what I have read on collection agencies (if he ever travels that route), they do not take monthly payment arrangements and will take 80% of the amount owed, fact or fiction or depends on the agency?

Collection agencies will not take his car or any other asset, they do not have that power. Collection agencies can work out monthly payment arrangements with debtors on behalf of their clients, these details are discussed in advance between agency and client or can be referred to the client by the agency if it's not within their mandate. There is no rule at how much agencies will take, it all depends on what the client has instructed the agency Don't worry about agencies, they work for their client, the client is in charge, the agencies use a lot of intimidation tactics to scare you Be aware that agencies can take your brother to court if arrangements can't be agreed to, it's up to them as instructed by their client. Look at the agency as an extension of the client's internal collection department

 

[Veronica27]

It really comes down to how good/bad is his credit rating and does he require good credit in the future ...

5 years back, CIBC promised my business a LOC. Because my business did not owe any money, when info was put into the computer, it said the business had "no trade lines". Thus no promised second LOC. Had to take second mortgage and was pissed at CIBC.

Maxed $25K CIBC Visa, and didn't make payments on it or $50K LOC. Ignored letters and changed phone numbers. Since all of it was UNsecured, they couldn't do much except threaten/wreck my credit rating. 10 months later they sent their lawyers after me.

I offered 75 cents to the dollar, and they accepted.

UNsecured means that they have to go through a long-winded lawyer/court process that will take years - that's the truth behind our judicial system. You can delay almost anything for years even without a lawyer. What they will do very quick is destroy your credit rating. Once they have done that, and I am not sure if that this is the case here, they have very little they can do if it is UNsecured.

So bottom line is really credit rating. If your brother's credit rating is shot, and I was him, I would just ignore them. Then ask for them to take a percentage. If your brother needs a good credit rating, he should IMMEDIATELY get another loan to payoff the outstanding amount. Otherwise, they will say they gave 2 months notice, and start to kill his credit rating.

 

[tboy]

I can pretty much guarantee you that a) they will call in the loan and b) they will go after him for the full amount and c) they will trash his credit rating over it d) for $20K they will sue him for it. For this large amount I don't think they'll simply refer it to a collection agency.

I had a LOC with TD Bank and to the day (almost to the hour) of me leasing a new truck they cancelled my LOC without warning. I went to purchase materials for a job on it and the transaction was refused. When I got home I phoned them and they referred me to my agreement. I said Oh Great, I've had the LOC for 5 yr and have no idea where it is.

To add insult to injury the phone person said "we sent you a notice that we were doing this". Yeah, I got that letter. A week after they closed the LOC and it was DATED the day they closed the account.......

Word of caution: negotiating a "settlement". The settlement will show up as an R9 (written off) amount on his credit history and remain there for 7 years.

I suggest he go to another bank or ?? and get another LOC and pay off the Citizen's Bank one....

 

[Moraff]

they have very little they can do if it is UNsecured.

I know you were typing it this way to emphasize the difference between unsecured and secured loans, but my brain kept insisting on reading it as "UN-secured" and presenting me with visions of soldiers in little blue berets standing guard over his LoC.....

Yes my brain is twisted......

 

[tboy]

It really comes down to how good/bad is his credit rating and does he require good credit in the future ...

5 years back, CIBC promised my business a LOC. Because my business did not owe any money, when info was put into the computer, it said the business had "no trade lines". Thus no promised second LOC. Had to take second mortgage and was pissed at CIBC.

Maxed $25K CIBC Visa, and didn't make payments on it or $50K LOC. Ignored letters and changed phone numbers. Since all of it was UNsecured, they couldn't do much except threaten/wreck my credit rating. 10 months later they sent their lawyers after me.

I offered 75 cents to the dollar, and they accepted.

UNsecured means that they have to go through a long-winded lawyer/court process that will take years - that's the truth behind our judicial system. You can delay almost anything for years even without a lawyer. What they will do very quick is destroy your credit rating. Once they have done that, and I am not sure if that this is the case here, they have very little they can do if it is UNsecured.

So bottom line is really credit rating. If your brother's credit rating is shot, and I was him, I would just ignore them. Then ask for them to take a percentage. If your brother needs a good credit rating, he should IMMEDIATELY get another loan to payoff the outstanding amount. Otherwise, they will say they gave 2 months notice, and start to kill his credit rating.

Doesn't anyone have any honour these days? You borrow money and then purposely don't pay it back? Then offer 75 cents on the dollar? How did they wrong you? by not giving you a LOC?

 

[Veronica27]

Doesn't anyone have any honour these days? You borrow money and then purposely don't pay it back? Then offer 75 cents on the dollar? How did they wrong you? by not giving you a LOC?

READ "5 years back, CIBC promised my business a LOC." Great CIBC customer for many, many years. Knew the bank manager and every teller. Based on my personal history and the millions flowing through my business account they said it would be a no-brainer. I acted accordingly, expecting the promise to be fulfilled. Had lots of $$$ coming from government in 3 months but needed LOC for payroll now. They put in the computer that my business had "NO TRADE LINES", that we owed no money, and presto, thus, no LOC. As a result I had to get a second mortgage when promised a LOC.

Yah, 75 cents to the dollar felt about right. I have plenty of honour.