Refinancing property - postponement of the terms
January 8, 2011 | 45,00 EUR | answered by Dr. Dr. Danjel-Philippe Newerla
Situation:
A family home loan needs to be refinanced. The current loan expires on 30.07.2013, so a forward loan was discussed with the house bank and an alternative bank in September 2010. Conditions were sent by the house bank via email with an attached calculation in pdf format and were also accepted via email.
Only after about 2 months, a final contract draft arrived by post with completely different conditions than previously discussed. The house bank claims a misunderstanding, and I have summarized the situation chronologically in writing with a request for a concrete response. So far, only a "discussion to find a mutually agreeable solution" has been offered, which I now consider unnecessary as interest rates in the market have already increased.
Specifically, €230,000 should be refinanced at 3.55% nominal interest for 10 years starting from 01.08.2013 (i.e. fixed interest rate until 30.07.2023). The house bank has changed this to 10 years at 3.55% from 09/2010 to 09/2013, stating that the contract can only start immediately. However, this seems completely illogical as the existing contract still runs until 2013, meaning that there would be an "overlap" of two contracts.
Conclusion: The house bank's offer reduces the fixed interest period where effective interest and repayment can be made to 7 years. Due to the "delayed response" from the house bank (it took 2 months to issue the contract draft), the current conditions are significantly higher.
Can damages be claimed for a breach of pre-contractual trust (CIC) with evidence of written email correspondence? What are the chances of success?
Dear Inquirer,
Thank you for your inquiry. I would like to answer as follows:
A conclusive assessment of the prospects of success of a lawsuit is unfortunately not possible without reviewing the contract documents and, in particular, thoroughly examining the relevant emails as part of an initial consultation. However, I would like to give you an initial legal direction.
You wrote the following (which, from my point of view, is the crucial sentence):
"Conditions were transmitted in writing by the house bank via email with an attached calculation in pdf and also accepted via email."
The question that arises for me here, besides the question of a pre-contractual breach of duty and a corresponding claim for damages, is rather whether at this point at least a preliminary contract had already been concluded on the corresponding terms. Offer and acceptance as grounds for entering into a contract are at least very plausible in this context based on your description.
This would be the point that would need to be finally checked by a colleague on site. If the offer/conditions do not state that they are non-binding, or if they can be understood as a binding offer, then you would have realistic chances to claim damages through legal action.
I hope I have provided you with an initial legal orientation and wish you much success and all the best!
I would like to finally draw your attention to the following:
The legal advice I have provided is based solely on the information you have provided. My response is merely an initial legal assessment of the situation and cannot replace a comprehensive evaluation of the facts. Adding or omitting relevant information can lead to a completely different legal assessment.
I hope my explanations have been helpful to you. You are welcome to contact me via my email address or the follow-up option.
Wishing you a pleasant Saturday afternoon!
Kind regards from the North Sea coast,
Dipl.-Jur. Danjel-Philippe Newerla, Attorney
Stresemannstr. 46
27570 Bremerhaven
kanzlei.newerla@web.de
Fax: 0471/140244
