Bank Blunders: Repossessions After Death, or Worse

No wonder Romanian clients are organizing in a bid to sue their banks. The money lenders in Dracula’s country send out bailiffs to foreclose or to repossess the dead. Bankers seem to ignore death certificates brought by relatives and make their late clients pay from beyond the grave.

A famous Romanian journalist, Mile Cărpenişan, who died on March the 22nd 2010, just won a court case against BRD Groupe Societe Generale. He had a good reason for not having paid two installments of a loan – he simply was no more.

Five months after Mile’s death, his relatives received notice that he was being summoned in court. The bankers probably did not watch the news very much, as the story of Mile’s untimely disappearance was covered by absolutely everyone in Romania. The court  ruled against the bank on September the 6th.

Other Romanians find themselves under threat of foreclosure for ridiculous amounts. A 43 years old man from Slobozia received notice of default from his bank for the amount of 1 BAN, that is equal to 1/100 of a Romanian Leu. The subdivision of Romania’s national currency equals to one third of a USD cent. Mr. Florea Mocăniţă had just settled his last installment of a 5 year loan. Only two week later he receive the NOD in the mail and was in danger of losing his home, which he had put down as collateral.

The bank admitted that the NOD was due to a computer generated document and that the overdue amount resulted from an automated balancing of the account. None the less, the bank was blunt about it: pay up, or else…

Many Romanians get bad credit history for amounts equal to 25 cents. Banks sometimes modify the interest rate witout sending notice to their clients. According to some contracts, the clients are supposed to come to the office and check personally with their banks to see whether the interest rates were changed.

Since most Romanians don’t check it, they pay the amount written in the original contract. But when a bank changes the interest rate, it usually means the amount just got a little bigger. Not by much, usually by one or two Romanian Lei. Just enough to get the client’s details in the Credit Bureau for bad credit history and, sometimes, to get banks to claim repossession or foreclosure on the collateral.

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