I am looking at getting a $80,000 loan NZD over 120 month repayment period with a 2% interest rate. It is a European

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Customer: Hello I am looking at getting a $80,000 loan NZD over 120 month repayment period with a 2% interest rate. It is a European Financial Union Institution. The repayments will be $737 per month and I will repay a total of $88,440 which is not 2%. The name of the lender is Valderez Financial Services. Could you possibly please check for me that this is a legitimate company and not a scam? Many thanks Michelle Amaru
JA: Because consumer protection law varies from place to place, can you tell me what state this is in?
Customer: European (Germany) is what i was told
JA: Have you contacted the seller or manufacturer?
Customer: Yes via email only
JA: Anything else you want the Lawyer to know before I connect you?
Customer: I don't think so.. thanks
Answered by Chris The Lawyer in 7 hours 2 years ago
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Chris The Lawyer
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Chris The Lawyer, Expert

Hi
I am a New Zealand lawyer based in Wellington and will help you with your question today. Please give me a minute to read your question
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Chris The Lawyer, Expert

Are they charging fees for setting up the loan? What security do they require?
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Chris The Lawyer, Expert

I haven’t heard of them, so are there any special terms about the loan?
Customer
They require no security the set up fee is $380. She says there is a penalty for late payment and I haven't heard back yet what that is. There was a push for me to sign the agreement within 12 hours. I have asked do I pay 2% pef annjm or is thag the fixed interest rate for the duration of the loan. She said that it is exactly 8,440
Customer
She just answered regarding penalty. A late monthly payment results in a $100 penalty added. She said her bank will offer me a range of credit insurance once I have received the credit in my bank account
Customer
I have just asked do I pay 2% per annum or 2% per month.. as it just sounds too good to be true
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Chris The Lawyer, Expert

Iris unusual and I haven’t see a loan like this before. It’s hard to see if this is legitimate
Customer
Ok she says the interest rate is annual and fixed at 2%
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Chris The Lawyer, Expert

On the face of it it seems to be good terms. My next concern is whether this is being used for money laundering.

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Chris The Lawyer, Expert

They do not seem to have an internet profile

Customer
No they can be found under Lucia Valderez Financial Services but not otherwise. Now do you think paying 2% fixed interest per annum and her saying that equates to 8,440 does that mean I pay 8,440 in interest per year?
Customer
Money laundering.. is that a way of them getting their money here? ��
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Chris The Lawyer, Expert

It is easy to transfer the money but they will need to comply with disclosure requirements under New Zealand law and explain they are a legitimate money lender. That figure for interest isn’t at 2% however
Customer
She actually does say the processing fee of $380 needs to be paid and then funds will be transferred
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Chris The Lawyer, Expert

In New Zealand banking practice that sort of fee is normally deducted from the advance so that may be a bit suspicious. If you paid that fee how can you be sure the advance will be made?
Customer
I know. Also she will not confirm it is on NZD either
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Chris The Lawyer, Expert

That and the upfront fee appear suspicious to me
Customer
Agree ill ask her again is it NZD also I would expect the set up fee to be taken from the loan..
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Chris The Lawyer, Expert

I think that is a cautious move
Customer
I'll let you know her response
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Chris The Lawyer, Expert

Ok
Customer
Hi Chris Lucia put the amount in NZD still saying that the fee will need to be paid first before her bank will release the loan. I asked her why did she want to help me she said she has helped a lot of people and that sha has fallen on hard times before and wants to help others as much as she can. She has reassured me again that the full amount she will receive from me over the 10 year period is $88,440 NZD
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Chris The Lawyer, Expert

I think it is risky and you could lose the fee. If something looks too good to be true, then it is generally a scam

Customer
I do think so also. At ine stage she said i must sign and scan documents back to her the next she said send a clear photo of documents. Apparently the money is coming from her personally
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Chris The Lawyer, Expert

All I can say is to be careful

Customer
Ok I will.. thank you
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Chris The Lawyer, Expert

Please feel free to follow up if you have more questions or rate my answer if you are ready
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