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OCBC house is in order with plain language

Plain English Campaign congratulate Oversea-Chinese Banking Corporation Limited (OCBC Bank), Singapore for taking another lead in the banking industry by achieving the Crystal Mark accreditation for their mortgage information. OCBC are working with Plain English Campaign in response to findings from studies about unclear financial information made in December 2010. OCBC are determined to make sure that every step of their mortgage process will be written in plain English. The first OCBC documents to receive the only internationally recognised standard for clear writing are the Home Loan mortgage application form, the letter of offer, the mortgage terms and conditions and the letter of declaration.

Owning a home is a cherished dream for many people, but it carries a financial commitment that can last for the person's lifetime. Dealing with the mortgage process can be a nightmare as the changing economy has a direct effect on mortgage repayments. Being able to fully understand the information in the mortgage process helps homeowners to deal more responsibly, and to their best advantage, with the changing circumstances in the financial industry.

Mr David McQuillen, Head of Group Customer Experience, OCBC Bank says, "For most people, getting a mortgage is a monumental, once-in-a-lifetime experience. It is also one full of complicated jargon and bank-speak that can make the process stressful and confusing. We felt our customers deserved better - so we set out to create documents that are completely clear every step of the way."

"Receiving the Crystal Mark is a defining achievement for us. We have shown that banking does not need to be convoluted and difficult to understand. By achieving the Crystal Mark, we have set the benchmark for others to follow if they are serious about being clear and transparent with customers. We will build on this and continue to work on creating documents that are easy to understand."

Most regulatory bodies are more concerned with the figures than the words, and it is left to the person taking out the mortgage to take responsibility for understanding the challenging financial terms and jargon. If these terms are not written in plain English, there is the risk that people may misunderstand them.

For example, In Singapore, the industry term 'quantum of financing' might sound like something from a James Bond film. It refers to the less exciting, but equally unclear industry term 'loan-to-value ratio',that is used in the UK. In plain English this is the loan amount shown as a percentage of the value of the property. It is one of the factors used by lenders to measure the level of risk involved in providing a mortgage.

Here are some other examples describing the different fees that might be involved in the mortgage process. Confusion with fees can lead to homeowners running up debts, or even losing their homes. It is vital that homeowners understand what these terms mean.

Cancellation fee: This fee is charged if the borrower cancels a loan after accepting it. Prepayment fee: This fee is charged if the borrower pays a lump sum off the amount they owe.
Late fee: This fee is charged if the borrower does not pay the monthly loan instalment when it is due. This is also often called a 'default fee'.

Chrissie Maher OBE, founder of Plain English Campaign says, "Clear communication is a global concern that has grown with technology. Every person has a right to information that can be understood with a single reading. Every person has the responsibility to communicate clearly. If just one person finds the confidence to shout out against unnecessary jargon, then our fight has been worthwhile. Everyone has a right to achieving the dream of owning their home. Any initiative like OCBC's plain English mortgage process can bring clarity and fairness to difficult times."

Coverage in the Singapore News.

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