- Report: #556235
Complaint Review: Canadian Imperial Bank Of Commerce - Sydney Nova Scotia
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Canadian Imperial Bank Of Commerce
toronto Sydney, Nova Scotia, Canada
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www.cibc.com
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Canadian Imperial Bank Of Commerce CIBC - Canada MORTGAGE RIP-OFF - HOMEOWNERS BEWARE Sydney, Nova Scotia, Canada
We recently sold our house and as a result closed out our five-year fixed-term mortgage. We were owing about $180,000 on the mortgage at an interest rate of 5.7%. We had been paying approximately $300 a week for about 80 weeks until the day we finally sold the place.
The mortgage broker had informed us that for closing out the mortgage early we would be penalized three months' worth of interest. Why this is permitted I have no idea because it doesn't make much sense to be charged a penalty for paying off a debt. Credit card companies would never get away with this. Nor would any other lending facility. However, the mortgage lenders have been allowed to employ this bizarre practice.
Even more bizarre, however, is the fact some small print on the contract allowed to CIBC to invoke a rather complicated formula that led us to being penalized far mroe than what three months' worth of interest would add up to. Guess how much (hint: better be sitting down when I give you the answer).
Would you believe: $11,000?
This at a time when people are losing their homes through no choice of their own. Imagine the shock when they're hit with such a mortgage "penalty" to boot. But they get away with it because they can.
So homeowners beware of this CIBC rip-off. Write your member of Parliament and complain, otherwise they'll keep on getting away with this because they can.
The mortgage broker had informed us that for closing out the mortgage early we would be penalized three months' worth of interest. Why this is permitted I have no idea because it doesn't make much sense to be charged a penalty for paying off a debt. Credit card companies would never get away with this. Nor would any other lending facility. However, the mortgage lenders have been allowed to employ this bizarre practice.
Even more bizarre, however, is the fact some small print on the contract allowed to CIBC to invoke a rather complicated formula that led us to being penalized far mroe than what three months' worth of interest would add up to. Guess how much (hint: better be sitting down when I give you the answer).
Would you believe: $11,000?
This at a time when people are losing their homes through no choice of their own. Imagine the shock when they're hit with such a mortgage "penalty" to boot. But they get away with it because they can.
So homeowners beware of this CIBC rip-off. Write your member of Parliament and complain, otherwise they'll keep on getting away with this because they can.
1 Updates & Rebuttals
ssca1212
United States of AmericaGet used to it
#2General Comment
Mon, February 15, 2010
you may feel that his is unnecessary but get used to it. If you had read the mortgage documents that you signed prior to closing it is stated very clearly that you will be subject to a penalty for prepaying ealry. the alternative is to wait till your term is up or port your mortgage which should have been explained to you by your broker. He probably failed to acknowledge this as he wouldnt get paid for getting you your next mortgage. All and I mean all mortgage companies have penalties for fixed rate mortgages unless it is an open mortgage. Doesn't matter where you go this will be the case
