Couple tell of fight for loan promises

When the Caseys wanted to buy their Kumeu home early in 2008 and needed 100 per cent finance they were attracted by Wizard's advertising. "We'd seen [former All Black] Grant Fox on the thing a couple of times and that's the thing that lured us in," Mr Casey said. Henderson branch owner-operator Daniel Singh offered them a mortgage for 12 months at 9 per cent interest.

The New Zealand Herald
January 20, 2009

Couple tell of fight for loan promises
Maria Slade

The first a customer of Wizard Home Loans in Henderson knew that the Serious Fraud Office was investigating the branch was when he read about it in the Weekend Herald.

Mike Casey and his wife say they struggled for months to get Wizard to honour promises the Henderson licensee had made them on their $500,000, 100 per cent mortgage.

Now they are concerned about what else may be wrong with their loan.

The Henderson and Lower Hutt branches of Wizard are being investigated for alleged mortgage fraud following complaints from the company's parent, finance company GE Money. The branches have since been closed.

When the Caseys wanted to buy their Kumeu home early in 2008 and needed 100 per cent finance they were attracted by Wizard's advertising. "We'd seen [former All Black] Grant Fox on the thing a couple of times and that's the thing that lured us in," Mr Casey said.

Henderson branch owner-operator Daniel Singh offered them a mortgage for 12 months at 9 per cent interest.

The documentation was late in coming through. When it arrived the Caseys discovered the terms of the mortgage were three years at 9.6 per cent, 10 per cent of the loan was with another financier, and there was a $9600 insurance fee.

"We were already five or 10 days late … when we got the documentation from him and being stung by fees from the people who were selling the house," Casey said. "We had to sign otherwise we'd be in a predicament."

The Caseys say Singh told them he would pay them the difference between the two interest rates, and did put money into their account. He also undertook to let them refinance after 12 months. In June Wizard wrote to the couple telling them the Henderson branch was being closed.

They say when they inquired, they were told they would have to stick with the documented terms of 9.6 per cent for three years.

But the couple's lawyer had made a note at the time that the promised terms differed from those on the documents, and after taking the matter to higher levels within GE Money the term has now been reduced to one year. But as late as November last year - five months after GE first complained to the SFO about Henderson - the Caseys say GE wanted to charge them $30,000 to get out of the 3-year loan.

Casey said "questionable" things occurred throughout the process of documenting the loan. "I've often wondered to myself what [was] represented forward to Wizard, in particular GE. I just wondered if it was the same stuff that we actually even said."

GE's Australian-based spokesman, Tristan Everett, said last week that the alleged actions of the branches being investigated were by no means a reflection of normal policy, and they were only two out of more than 100 Wizard licensees and mobile managers.

Mr Everett said yesterday: "GE Money investigates all complaints on home loans … As far as we know any concerns were met to the customer's complete satisfaction - to that end the customer is due to refinance in February at no cost to him.

"We have no outstanding customer complaints that haven't been investigated with these two Wizard branches. If anyone does have a loan with those two branches that they believe they need to discuss they should contact us on our normal Auckland number, 09 368-0300."


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