The Interest Savers

THE BANK STATEMENT

1. PURPOSE OF THE BANK STATEMENT

2. WHAT SHOULD BE INCLUDED

3. CHECK LIST

4. SAMPLE STATEMENTS

4-A SAMPLE STATEMENT No. 1 Small Overcharge

4-B SAMPLE STATEMENT No. 2 Correct but does not account for Leap Year

4-C SAMPLE STATEMENT No. 3 Massive Overcharges … $30,000+

4-D SAMPLE STATEMENT No. 4 Massive Overcharges $2,500 in one month

4-E SAMPLE STATEMENT No. 5 Undercharges

4-F SAMPLE STATEMENT No. 6 Overcharged

5. THE HOME LOAN CHECKER: CHECK YOUR CHARGES

1. PURPOSE OF THE BANK STATEMENT
WHY HAVE STATEMENTS
FREQUENCY OF STATEMENTS
MISTAKES DO OCCUR

2. WHAT SHOULD BE INCLUDED
WHAT TO INCLUDE
WHAT YOU PAY FOR

3. CHECK LIST
A SAMPLE CHECK LIST

4. ACTUAL STATEMENTS

4-A No. 1 : ALMOST PERFECT

4-B No. 2 : A RIP - OFF
EFFECT OF LEAP YEARS

4-C No. 3 : MASSIVE OVERCHARGING

4-D No. 4 : MISTAKES GALORE
INCOMPETENCE PLUS

4-E No. 5 : THEY DO UNDERCHARGE

4-D No. 6 : OVERCHARGING
EFFECT OF LEAP YEARS

5. THE HOME LOAN CHECKER: CHECK YOUR CHARGES
HOW TO CHECK YOUR STATEMENTS
STEP BY STEP PROCEDURES
USE THE FREE HOME LOAN CHECKER AT OUR WEBSITE

THE PURPOSE OF A BANK STATEMENT

52% TO 54% OF BANK STATEMENTS CONTAIN ERRORS *

MOST BANK CUSTOMERS DO NOT CHECK THEIR BANK STATEMENTS

CUSTOMERS THAT HAVE CHECKED HAVE DISCOVERED ERRORS OF
UP TO $100,000.

IT PAYS TO CHECK YOUR STATEMENTS

BANKS DO MAKE MISTAKES

* INDEPENDENT SURVEYS CONDUCTED BY THE INTEREST SAVERS
FOR MAJOR NEWSPAPERS AND A MAJOR NON-BANK FINANCIER

A bank statement is a record of all transactions that have affected your account since the last statement.
The statement should inform you as to what has been happening in your account.
It should enable you to check that the bank has correctly recorded all your transactions.
A summary of your account should inform you of the amount owing by you to the bank (or the amount owing
by the bank to you) at the start of the statement and at the end of the statement.
The statement is to enable you to query any transactions that appear and of which you may be uncertain.
The statement is to enable you to keep a continuous record of all details relating to the account.

FREQUENCY OF BANK STATEMENTS:

Banks differ in the frequency of providing statements but it will usually depend on the frequency that you require.
The customer may require statements monthly, quarterly, half-yearly, yearly or even weekly.
The bank may impose charges on the provision of statements and these charges may vary with the frequency of the statements.

CHECKING YOUR BANK STATEMENT:

Always check your statements for the following:

* the opening balance should be the same as the closing balance from the previous statement

* all debit entries (entries that increase the amount owing to the bank or that decrease the amount owing to you by the
bank) are correct and justified and have been entered on the correct date

* debit entries will include bank fees and charges and interest charged to your account

* all credit entries (entries that decrease the amount owing to the bank or that increase the amount owing to you by the
bank) are correct and justified and have been entered on the correct date

* credit entries will include deposits/repayments made to your account and interest credited to your account

* the figure in the balance column is correct

* the interest amount debited or credited to your account is correct (use the Home Loan Checker program)

* any ‘reversals’ or other unexplained entries should be queried

* be certain that the bank has quoted and used the correct rate of interest

WHAT IF I DISAGREE WITH THE BANK’S STATEMENT:

* contact your bank’s head office by way of letter explaining the error

* address the letter to the managing director

* make a copy of the statement and send it with the letter

* keep a copy of the letter

* if you do not receive a reply within 14 days send a copy of your previous correspondence to the chairman of the bank

* if you are not satisfied with their reply, arrange a meeting with the head of the customer relations division

* if you remain dissatisfied with the bank’s explanation, contact the banking ombudsman

WHAT YOUR BANK STATEMENT SHOULD INCLUDE

MOST CUSTOMERS ARE NOT AWARE OF WHAT SHOULD BE INCLUDED
ON THEIR STATEMENTS
MANY LENDERS DO NOT PROVIDE ADEQUATE INFORMATION
IT IS YOUR RIGHT TO BE GIVEN ALL RELEVANT INFORMATION

[1] A Summary Page to show the following information:

• Borrowers name and address.

• Borrowers account number.

• Number of statements issued. E.g. this is the 4th statement issued.

• Page number for this statement. E.g. Page 1 of 3 means this is the 1st page
of 3 pages for this statement.

• Statement Begins: The start date for this statement. E.g. Begins at 1-1-99.

• Statement Ends: Shows the last date for this statement. E.g. Ends at 30-6-99.

• The previous Statement end date.

• The Opening Balance [ i.e. the balance owing at the start of the period ]

• The Closing Balance [ i.e. the balance owing at the end of the period ]

• The Total of all Credits [ i.e. all repayments and any other payments and or reversals
made to the account during this period to reduce the balance owing ]

• The Total of all interest charged to the account for the period

• The Total of all bank fees and charges for the period

• The Total of all government fees and charges for the period

• The Total of all reversals made to the account during this period

• The current interest rate being charged and any changes to the interest rate charged in this period.

• The required minimum Repayment amount and the date of the repayments

• The Bank’s telephone number for enquiries.

MAIN STATEMENT to include :

[2] Borrowers name and address.

[3] Borrowers account number.

[4] Number of statements issued. E.g. this is the 4th statement issued.

[5] Page number for this statement. E.g. Page 2 of 3 means this is the 2nd page
of 3 pages for this statement.

[6] Statement Begins: The start date for this statement. E.g. Begins at 1-1-99.
It should show the opening balance at this date. (i.e. how much is owing ).

[7] Statement Ends: Shows the last date for this statement. E.g. Ends at 30-6-99.
It should show the closing balance at this date. (i.e. how much is owing ).

The statement Beginning and Ending dates show you the period that the statements covers. In this case it is a six-months period. It should show all transactions that have occurred during that period. E.g. It will show :
• the opening balance [ i.e. the balance owing at the start of the period ]
• the closing balance [ i.e. the balance owing at the end of the period ]
• all credits [ i.e. all repayments and any other payments and or reversals
made to the account to reduce the balance owing ]
• all debits [ i.e all interest charges (usually monthly)
all bank fees and charges (usually monthly)
all government fees and charges (usually monthly)
any reversals that will increase the balance owing].

[8] Date Column: The dates on which each transaction occurs are shown in this column.
There may be more than one transaction on any date.
Debit transactions (Interest Charged, Bank Fees and Charges, Withdrawals, Government Charges etc.) will increase the balance owing
Credit transactions (Repayments made by the borrower) will reduce the balance owing.

[9] Transaction Description: This column shows a description of the transaction.
i.e. Repayment (reduces the balance owing)
or Interest Charged (increases the balance owing)

[10] Debits Column: This column shows the dollar amount of each transaction that increases the balance owing.
E.g. Interest Charged

[11] Credits Column: This column shows the dollar amount of each transaction that decreases the balance owing.
E.g. Repayments

[12] Balance Column: This column shows the balance owing after each transaction and/or at the end of each day
when a transaction has occurred.
There may be up to 30 days between transactions and therefore between a change in the balance
owing. This means that the balance owing has remained the same for each of the days since the previous balance change.

[13] Interest Rate: The interest rate is shown as a % being used to calculate interest on the outstanding
balance owing. Interest is usually calculated at the end of each day on the balance owing at the
end of the day. All of the daily interest amounts are normally totalled at the end of the month
( or on the same date of each month ) and charged ( debited ) to the account to increase the
balance owing.

[14] The Bank’s telephone number for enquiries.

CHECK LIST

A SIMPLE CHECK LIST IS PROVIDED TO ENSURE YOU ARE RECEIVING
ALL INFORMATION TO WHICH YOU ARE ENTITLED

YOU ARE PAYING FOR IT … ARE THEY PROVIDING IT ?

YES NO

[1] A Summary Page to show the following information:

Borrowers’ name and address

Borrowers’ account number

Number of statements issued

Page number for this statement

Statement Start Date

Statement End Date

Previous Statement end date

Opening Balance

Closing Balance

Total of all Credits

Total of interest charged for the period

Total of bank fees & charges for the period

Total of govt. fees & charges for the period

Total of all reversals during this period

Current interest rate charged

Interest rate changes

Required minimum repayments

Lender’s telephone number for enquiries

MAIN STATEMENT to include:

[2] Borrowers’ name and address

[3] Borrowers’ account number

[4] Number of statements issued

[5] Page number for this statement

[6] Statement Start date

[7] Statement End date

[8] Date Column

[9] Transaction Description

[10] Debits Column

[11] Credits Column

[12] Balance Column

[13] Interest Rate

[14] Interest Rate Changes & dates

[15] Lender’s telephone number for enquiries

SAMPLE STATEMENTS

SIX ACTUAL BANK STATEMENTS
LOOK AT THE MASSIVE OVERCHARGES
SOMETIMES, VERY RARELY, THEY DO UNDERCHARGE
SEE WHY IT PAYS TO CHECK YOUR STATEMENTS
HOW THEY DISCOVERED THE OVERCHARGES

4-A SAMPLE STATEMENT No. 1
MAJOR INTERNATIONAL BANK
Page 1 of 3

[1] Bank Lender No. 1

[2] Level 1, 444 Suburban St. [9] Statement 4 Page 1 of 3

Suburbia.

[3] Telephone: 123555 [10] Statement begins 1 January 1999

[4] Statement/account enquiries: 123456 [11] Statement ends 30 June 1999

[5] Fax number: 234567

[6] Lost/stolen cards: 223456 [12] Minimum Repayments $535 per month

[7] Account name(s):

J & J Customer [13] Interest Rate 6.550% per annum

22 Borrower St

Mortgagebelt. [14] Loan Balance $78,017.98 Dr

[8] Account type and number

Home Loan HL456789

[15] HOME LOAN SUMMARY

[16] Overview [17] Opening balance 1 January 1999 $78,846.32 Dr

[18] Government charges $ 1.95

[19] Bank fees $48.00

[20] Interest Paid $2,566.71

[21] Repayments/Payments $3,445.00

[22] Closing balance 30 June 1999 $78,017.98

[23] Remaining term of loan Based on repayments of $535 per month and an

interest rate of 6.55% 24 years 4months

[24] Interest Total interest paid this financial year: $5,270.14

[25] Special Repayments You are $800 ahead in your repayments

4-A SAMPLE STATEMENT No. 1
MAJOR INTERNATIONAL BANK
Page 2 of 3

[1] Bank Lender No. 1

[2] Address : Level 1, 444 Suburban St. [5] Statement 4 Page 2 of 3

Suburbia.

[3] Account name(s): [6] Statement begins 1 January 1999

J & J Customer [7] Statement ends 30 June 1999

22 Borrower St

Mortgagebelt.

[4] Account type and number

Home Loan HL456789

Date [8] Transaction Description [9] Debits [10] Credits [11] Balance [12]

Interest rate as at 01/01/99 6.55% per annum [13]

01 Jan Opening balance 78,846.32 Dr

11 Jan Repayment/Payment 265.00

Financial Institutions Duty 0.15 78,581.47 Dr

18 Jan Interest charged 440.39 79,021.86 Dr

18 Jan Fee for servicing your loan 8.00 79,029.86 Dr

25 Jan Repayment/Payment 265.00

Financial Institutions Duty 0.15 78,581.47 Dr

08 Feb Repayment/Payment 265.00

Financial Institutions Duty 0.15 78,500.16 Dr

18 Feb Interest charged 438.03 78,938.19 Dr

18 Feb Fee for servicing your loan 8.00 78,946.19 Dr

22 Feb Repayment/Payment 265.00

Financial Institutions Duty 0.15 78,681.34 Dr

08 Mar Repayment/Payment 265.00

Financial Institutions Duty 0.15 78,416.49 Dr

18 Mar Interest charged 395.06 78,811.55 Dr

18 Mar Fee for servicing your loan 8.00 78,819.55 Dr

22 Mar Repayment/Payment 265.00

Financial Institutions Duty 0.15 78,554.70 Dr

05 Apr Repayment/Payment 265.00

Financial Institutions Duty 0.15 78,289.85 Dr

18 Apr Interest charged 436.57 78,726.42 Dr

18 Apr Fee for servicing your loan 8.00 78,734.42 Dr

19 Apr Repayment/Payment 265.00

Financial Institutions Duty 0.15 78,469.57 Dr

03 May Repayment/Payment 265.00

Financial Institutions Duty 0.15 78,204.72 Dr

Balance carried forward to next page 78,204.72 Dr

4-A SAMPLE STATEMENT No. 1
MAJOR INTERNATIONAL BANK
Page 3 of 3

Telephone: 123555 Statement 4 Page 3 of 3

Statement and account enquiries: 123456 Statement begins 1 January 1999

Fax number: 234567 Statement ends 30 June 1999

Lost/stolen cards: 223456

Account name(s):

J & J Customer

22 Borrower St

Mortgagebelt.

Account type and number

Home Loan HL456789

Date Transaction Description Debits Credits Balance

Balance carried forward from previous page 78,204.72 Dr

17 May Repayment/Payment 265.00

Financial Institutions Duty 0.15 77,939.87 Dr

18 May Interest charged 421.73 78,361.60 Dr

18 May Fee for servicing your loan 8.00 78,369.60 Dr

31 May Repayment/Payment 265.00

Financial Institutions Duty 0.15 78,104.75 Dr

14 Jun Repayment/Payment 265.00

Financial Institutions Duty 0.15 77,839.90 Dr

18 Jun Interest charged 434.93 78,274.83 Dr

18 Jun Fee for servicing your loan 8.00 78,282.83 Dr

28 Jun Repayment/Payment 265.00

Financial Institutions Duty 0.15 78,017.98 Dr

30 Jun Closing balance 78,017.98 Dr

SAMPLE STATEMENT 1 HOME LOAN CHECKER
INTEREST CHARGED ON 18th FEBRUARY 1999 OVERCHARGED

Notes:

1. The start date is the date of the previous ‘interest debit’ shown on the statement
( 18th January 1999).

2. The end date of 17th February 1999 is the date prior to the ‘interest debit’ being checked
( 18th February 1999).

3. The opening balance is the last balance shown at the end of the start date ( $79,029.86 ).

4. The interest rate is the interest rate shown on the statement. The interest rate should be shown on your statement. If it is not shown, the lender must provide the interest rates.

5. The number of days box is automatically set at 365 days which is used in the lenders formula.
You may change this to 366 days for leap years as the lender should use 366 in their formula for leap years. Most lenders do not use 366 days for leap years and this results in higher interest charges for the borrower. The borrower then pays additional interest on that overcharge for the life of the loan.

6. The balances shown on the left hand side of the screen under Daily Balance Entries have been inserted by clicking the ‘ADD’ box. When the balance changes the new at the end of the day is inserted. Lenders calculate interest each day on the balance at the end of the day.

7. The Revised Interest Rate box at the top right side of the screen allows for interest rate changes.

8. The Interest Debit amount at the bottom of the screen shows the interest that should be on the statement ( $437.57 - the statement shows $438.03 which is an overcharge of 46 cents).
This is obtained by clicking the Compute Interest box.