Secret Mortgage Commissions

VickyHoughton

Hi Everyone

I had a phone Call on Friday from a company called Your Debts Cleared they said, I may be able to claim back fee's on my mortgage or my secured loan.

When my mortgage was taken out about 6 Years ago, I went through a Mortgage broker and the broker was paid a commission from the lender for signing me up for my mortgage.

I was never told about these fee's and apparently I can claim these fee's back plus any interest that I have paid.

The guy that called me said the claim is called Hidden Commissions or Secret Commissions and I have a good claim because my mortgage was taken out before October 2004.

This sounds to good to be true!

Has anything had any phone calls or any dealings with Hidden Commissions or Secret commissions?

dunstonh

I had a phone Call on Friday from a company called Your Debts Cleared they said, I may be able to claim back fee's on my mortgage or my secured loan.

Its highly unlikely. Possible but not many successes and for most people not worth the effort.

When my mortgage was taken out about 6 Years ago, I went through a Mortgage broker and the broker was paid a commission from the lender for signing me up for my mortgage.

I was never told about these fee's and apparently I can claim these fee's back plus any interest that I have paid.

You didnt pay fees. The lender paid a commission. If you paid a fee and a commission was received as well then you certainly are able to go to court to claim back the commission.

The guy that called me said the claim is called Hidden Commissions or Secret Commissions and I have a good claim because my mortgage was taken out before October 2004.

There has been one successful court case and in that case it wasnt a mortgage but a secured loan and the broker took a fee as well as taking a commission. Where it is fee only or commission only the chances of success are much lower (in case of fee only then its non existent).

This sounds to good to be true!

It is. Mortgage commission is around 0.2-0.3% on prime mortgages. So, if you borrowed say £80k and the commission was 0.25% then the commission is £200. Its not a lot of money and chances of success are not great and most claims companies are not even bothering in this area unless its in conjunction with a wider claim. The size of the potential claim is so small that its not really cost efficient.

It would also depend on the type of mortgage adviser used. Not all get commission but are paid on bonuses. Also, many mortgages dont pay a commission and the earnings for the broker are in the insurances sold with it.

VickyHoughton

Thanks for your reply.

I was told that because my mortgage was with a sub prime lender that the broker may have got a 5% fee which on my mortgage of £95k is a lot of money..

Does that sound write to you?

dunstonh

I was told that because my mortgage was with a sub prime lender that the broker may have got a 5% fee which on my mortgage of £95k is a lot of money..

You need to separate fee and commission. Fee is what you pay out of your money. Commission is what is paid by the lender to the broker and doesnt come out of your money.

Does that sound write to you?

sub prime did pay more commission.. Typically in the 2-3% range.

Did you pay fees to the broker or did you work on commission only basis?

VickyHoughton

Yes I think they charges us a broker fee that was included in our loan, but the guy from Your Debts Cleared said the broker may have been paid a fee from the lender as well and that is what I can claim back.

Do you think I might be able to claim?

dunstonh

If you paid a fee and a commission was paid as well and that commission was not disclosed then you have very good grounds to claim the commission that was paid to the broker.

For others reading, if a fee was agreed and the commission offset the fee then that is considered acceptable as its not in addition to the fee but used to reduce or remove it.

VickyHoughton

Thanks for you advice, I spoke to Your Debts Cleared last night about this hidden commissions claim and they are sending me some paperwork to complete. They said that they will request all my infomation, from my lender and see exactly what is in the agreement.

I will keep you updated on my claim.

Thanks Again :j

payless

If I remember correctly mortgage commisison in excess of £250 were declarable by brokers from 1998. (MCCB rules)

Off hand can't remember if at this stage (between 98 but before 2004 ) whether it was also declared by lender

If not declared who do you think is likely to refund this fee .. is the broker still around? ( lender to that fact ?)

Commission was not as high as mentioned- although there may have been a packager's fee paid by lender as well - whether this needed to be declared ( at that stage) is less clear

payless

YourDebtsCleared.com charge a standard Audit fee of £85.00. ....(this is non-refundable) .......................we also ask for 20% of any monies returned back to you from the lender.