Mortgages for the Self Employed

snoopy123_2

My friend was sold his mortgage last year, in my opinion, by an unscrupulous broker. The advice he was given resulted in him being promised a 'reasonable sounding mortgage' which after the broker dissapeared was withdrawn. In a panic my friend found a mortgage on the internet which made all sorts of promises. Consequently he is now trapped with a £200k mortage with a 8% redemption penalty. The mortgage is charging horrendously high interest rates which go up even further in August. Following a couple of months of unemployment he now has arrears of £3K, which he is overpaying at a rate of £200 per month.

Our quesitons are;

1) when looking for self-certified mortgages where is the best place to go?
2) in the current climate is is realistic to think he can remortgage with the arrears.

Any help would be greatly appreciated.
Thank you

Conrad

No chance with arrears. Platform home loans can consider 2 months arrears in the last 12 for a rate of 9%, but will only lend where it is clear all financial difficulties are behind them.

Self cert is very limited and with arrears in the recent past, an almost certain no no.

Your freind may want to consider a misselling claim. The lender / broker he went through will have had a duty to collecg documentary evidence of the clients ABILITY TO PAY, regardless of the fact it was a self cert application.

Note a broker has this duty even if a lender did not request such documentation themselves.

If the broker / lender is in breach of thier duty to discharge thier responsibilities in a compliant manner, there could be a claim against them.

The FSA have laid down 6 core principles, which all firms must abide by and these principles are bound up in an initiative known as TREATING CUSTOMERS FAIRLY.

In the event of persuing a claim it is worth reminding the compliance officer of TCF principles.

Gorgeous_George

AIUI the OP's friend didn't use the broker and used a company that they found on the Internet.

I have some sympathy for people who are deliberately mis-sold financial products. However, we are supposed to be adults and accountable to ourselves for our actions.

GG

luckyfool

Gorgeous_George wrote: »

AIUI the OP's friend didn't use the broker and used a company that they found on the Internet.

I have some sympathy for people who are deliberately mis-sold financial products. However, we are supposed to be adults and accountable to ourselves for our actions.

GG

I agree, though how "my friend was sold a mortgage by an unscrupulous broker" turned into the broker disappearing and his "friend" getting his own mortgage on the internet I'm not sure. How the fact that he has managed to get himself onto a very expensive and unsuitable mortgage is the fault of the original broker who was not involved at all escapes me.

snoopy123_2

Thank you for those who have replied. I appreciate that it is difficult to give you the full details and the story is very long and involved. I have just tried to give a overview of how my friend ended up making a very rash and stupid decision over his mortgage choice. The reason for posting now is not to debate the mortgage broker or his own decisions which he admits were done through panic, but how we can avoid the same mistakes happening again. I unfortunately, do not have any experience in the self-employed market and hence my suggestion was to throw the subject open in the hope of receiving any advice on remortgaging from those with experience.
Thanks