Mortgage insurance - medical examination. Legal?

[_doctor]

Hi All

Lately we have moved our mortgage loan from OsuusPankki-Tampere to Nordea. Everything went fine, except for the fact that they wanted me and my wife to pass a number of medical tests in order to get the loan insurance. The most strange part in it was their reasoning.

I speak a bit of Finnish, my wife speaks enough to understand the insurance terms. Basing on that Nordea allowed us to sign the insurance papers (normally they require that somebody who speaks Finnish should serve as a translator for non-speakers) and AFTER signing they gave us:
1) forms to fill a large medical statement about our health condition
2) A crappy piece of paper which did not look like an official document at all. The paper stated "If a person doesn't understand Finnish, for getting the loan insurance he should bring a translator along when signing the papers, fill a detailed statement about his/her health conditions and take 8 medical examinations (several blood analysis including one for HIV and cardiogram)

It makes me wonder how legal it is. Specifically I fail to get the reasoning. If they don't trust our level of Finnish, why do they require medical tests and not a language certificate? If they don't trust our statements, why do Finnish skills matter? And does the bank has the right to know if we are HIV-positive or not?

Could you, please, give an advice about this situation?

[Tiwaz]

They are not interested in your language skills, they want your money.

They are interested if you will live to pay your loan.
Thus, medical papers. Guy with HIV is unlikely to live to pay remaining 20 years of their loan.

[sinikettu]

I seem to remember that Phil (Finland for thought) had a run in with Nordea (which he lost) when the would not give him mortgage insurance ...because he was not a Finn...Seems they now have amended that clause..but bought in this medical thing..I wonder if it is only for Non Finns?.

BUT...
The bottom line being if you want to borrow money the lender can decide the terms and conditions it is up to the borrower to decide if he/she want the money under those conditions.

If not try and borrow elsewhere.

That is exactly want Phil did, he went to another bank where they would allow him (a Non Finn) to have mortgage insurance.
Nordea is a Swedish Bank (Odd lots Swedes) try Sampo they are Danish.

[_doctor]

The bottom line being if you want to borrow money the lender can decide the terms and conditions it is up to the borrower to decide if he/she want the money under those conditions.

Hmm.. That's an understandable point of view, but aren't laws protecting certain levels of privacy and limiting the amount of info an organization can ask for? E.g. I've heard that insurance companies cannot adjust terms basing on the genetic information (not sure if it is true for Finland)

[sinikettu]

Firstly Nordea is a Bank not an insurance company.
But of course they have a relationship with at least one.
I just did a check on their web site and find that they use TrygVesta Insurance.
http://www.nordea.com/Press%2Broom/Curr ... 71342.html

As I said already the lender can ask for what ever they like, and asking that the lender can prove that they are not a health risk is not un-common.
But it is TrygVesta Insurance that requires this not Nordea.

Regarding your statement "insurance companies cannot adjust terms basing on the genetic information "..
You need to check if they also demand medical checks of Finnish borrowers.

[Tiwaz]

The bottom line being if you want to borrow money the lender can decide the terms and conditions it is up to the borrower to decide if he/she want the money under those conditions.

Hmm.. That's an understandable point of view, but aren't laws protecting certain levels of privacy and limiting the amount of info an organization can ask for? E.g. I've heard that insurance companies cannot adjust terms basing on the genetic information (not sure if it is true for Finland)

Really?

Guess what. Insurance companies can, and do, ask for health information. And it has effect on insurances.

I have insurance in case of serious injury or disease, and they demanded me to assure with my signature etc that I do not have diagnosed conditions like cancer when signing up. They also wanted to know if I smoke, if I did smoke the payment would go up.

Insurances can and will be limited depending from type or insurance and type of disease.

And since you are asking for loan insurance...

[DMC]

The point about the lender being able to impose whatever terms they like, and the borrower having the option not to borrow from them, has some logic behind it. The fact is though that the terms about the medical checks were imposed AFTER _doctor had signed the agreement, so he didn't really have the same option to walk away. If this were in the UK, I believe such an action by the lender would contravene the Unfair Contract Terms Act. (I think I have remembered the name of the act correctly, but may be wrong). A test case under that act established that a party to a contract cannot keep contract terms secret until after the contract is entered into. So if it were me, I would want to check if similar legislation exists in Finland. It seems reasonable that there should be such legislation here, but you never know.

[Tiwaz]

The point about the lender being able to impose whatever terms they like, and the borrower having the option not to borrow from them, has some logic behind it. The fact is though that the terms about the medical checks were imposed AFTER _doctor had signed the agreement, so he didn't really have the same option to walk away. If this were in the UK, I believe such an action by the lender would contravene the Unfair Contract Terms Act. (I think I have remembered the name of the act correctly, but may be wrong). A test case under that act established that a party to a contract cannot keep contract terms secret until after the contract is entered into. So if it were me, I would want to check if similar legislation exists in Finland. It seems reasonable that there should be such legislation here, but you never know.

Ah, you are missing something or I have misunderstood something...

They want loan INSURANCE, apparently to make sure they do not risk running into trouble to pay their loan if something happens. That is separate from actual loan, and has to go through insurance company. It is handled by bank, but given by insurance company.


Other details that came to my mind. There is possibility that contract states that some details depend on customers health conditions. Like my insurance payments which would go up if I became smoker. In such case you agree to inform in your debtor/insurance company with information on your health in actual contract and keep them updated on changes. Which can take place as paper they are asking OP to fill.

[_doctor]

They want loan INSURANCE, apparently to make sure they do not risk running into trouble to pay their loan if something happens. That is separate from actual loan, and has to go through insurance company. It is handled by bank, but given by insurance company.

Actually bank requires loan insurance. We would want it also and we want to insure more, than is required by the bank. However, Nordea gives big loans only if they are insured by their own insurance company.

[Tiwaz]

They want loan INSURANCE, apparently to make sure they do not risk running into trouble to pay their loan if something happens. That is separate from actual loan, and has to go through insurance company. It is handled by bank, but given by insurance company.

Actually bank requires loan insurance. We would want it also and we want to insure more, than is required by the bank. However, Nordea gives big loans only if they are insured by their own insurance company.

And thus, you need insurance which in turn depends on it's terms from your health.

Nordea has right to put it as requirement for loan, which you clearly have agreed to and were informed of, and insurance company has right to demand to know your current health to determine your insurance risk. Depending on your health and actual details of insurance they can either increase your payments or reduce your coverage due to higher than usual risk.

It is legal and common practice to my knowledge. Then again, it depends on arrangement. I have enough investments in my savings insurance and other such arrangements that they act as collateral for my mortgage in Osuuspankki. (along with me being owning member and getting bonuses from my debt paying my Pohjola insurances)

[sinikettu]

Unfair Contract Terms Act. (.

Yep it exists..

http://www.johnantell.co.uk/UCTA1977.htm

But I believe that in the small print of the document that _doctor signed..there will be a clause that say something like...
"Subject to satisfying all requirements and conditions of providing the insurance cover"
E.G medical fitness.
Nordea and TrygVesta Insurance are not back street companies..they will work inside the law.

[DMC]

Yep it exists..

Good to know my memory still works. It is more than 25 years since I learned about that Act in night school, but I even remember the pertinent details of the test case. If I could only remember where I put my keys yesterday ....

But I believe that in the small print of the document that _doctor signed..there will be a clause that say something like...
"Subject to satisfying all requirements and conditions of providing the insurance cover"
E.G medical fitness.
Nordea and TrygVesta Insurance are not back street companies..they will work inside the law.

Yes, that is the crux: IF similar legislaton exists here, and IF there was no prior mention of the medical terms prior to _doctor being given them after signing the agreement, he would seem to have a case. If things are as you suggest, he doesn't. Those companies will certainly aim to work within the law, but there is always room for human error. For example, maybe the individual employee mistakenly did not reveal the medical requirements prior to _doctor signing. I'm not saying it is so, just that it is worth checking.

[Tiwaz]

Yes, that is the crux: IF similar legislaton exists here, and IF there was no prior mention of the medical terms prior to _doctor being given them after signing the agreement, he would seem to have a case. If things are as you suggest, he doesn't. Those companies will certainly aim to work within the law, but there is always room for human error. For example, maybe the individual employee mistakenly did not reveal the medical requirements prior to _doctor signing. I'm not saying it is so, just that it is worth checking.

Ah, but here is the catch again as I see it.

He is getting the loan, but condition for getting loan is getting it insured which he was informed of.
To get it insured, he must hand over his medical conditions, which again is not related to his loan acceptance but his insurance which are two different things despite being connected. And in process of getting insurance he has to give his health information for purpose of determining his insurance risk which he is now being informed of (apparently during process of getting the insurance which he agreed to get when he signed his loan papers).


He failed to figure out by time of signature ALL the requirements to get EVERYTHING sorted out. He, once again bad thing to do, assumed stuff.

[sinikettu]

They want loan INSURANCE, apparently to make sure they do not risk running into trouble to pay their loan if something happens. That is separate from actual loan, and has to go through insurance company. It is handled by bank, but given by insurance company.

Actually bank requires loan insurance. We would want it also and we want to insure more, than is required by the bank. However, Nordea gives big loans only if they are insured by their own insurance company.

This is the absolute bottom line..It is Nordea that demands that BIG lenders are insured..
Whether the doctor knew or did not know that insurance requires a medical is not really relevant.
What will complaining that it was not made clear acheive? ..Nordea just say..sorry ..but nothing the doctor can do.

What if the doctor fails the medical or says he is not gong to have one?

Simple ..no insurance...no loan from Nordea.

[Hank W.]

I know you get about 5 pages full of "small print" when you sign your mortgage... must be all kinds of things hidden in there.