C & G Changed Conditions

DonutUK

Just got off the phone to C&G as was trying to arrange an payment break.

They have informed that the T&C's changed "late last year" so that you can only have one every 3 years. This is not what i signed up to. I was told when i signed the mortgage that i could have one every 12 months (providing i had paid 12 full months between them). My last one ended in Sept 07 so can't have another one until Sept 10.
They said that they probably sent out a leaflet with the annual statement....well i have checked and there was never one sent with my statement.

I have now been told that if i want upto 3 months "payment assistance break" then i would have to go through income/expenditure details and they would "assess" whether i qualified or not.

Surely i must have some recourse as they have changed the conditions without notifying me?

dunstonh

This is not what i signed up to

authorised arrears are not something you sign up to.

They said that they probably sent out a leaflet with the annual statement....well i have checked and there was never one sent with my statement.

I'm with C&G and they do periodically send out a list of charges leaflet.

Surely i must have some recourse as they have changed the conditions without notifying me?

None at all. You bought a mortgage and they are complying with providing that. Asking for authorised arrears is not something that is a contract event that you agree to in advance. Its a feature that may or may not be available and can be added or removed without requiring a new contract to be signed.

Conrad

For you to bring about a sucessful claim against C & G, you will need to demonstrate they broke with the priciple known as 'Treating Customers Fairly'.

Within that are 6 key tenats, some or all of which may assist you.
Clause 3 for example - 'Consumers are provided with clear information and kept appropriately informed'.

Now I'm not implying C & G have a case to answer, but I suppose there is no harm trying a special delivery letter to the mortgage compliance department.
The KEY document you RELIED upon at point of sale was called a KEY FEATURES ILLUSTRATION - you might want to base your claim around that as I have a gut feel it may not have employed clear language in this regard.

On the other hand the FSA insists lenders lend responsibly, so they may well argue the macro economic enviroment places a duty of care to discharge decisions that sit well with 'responsible lending'.

If you do raise a claim, you need to be clear on the outcome you want to achieve - i'e' a payment break.

My hunch is your claim will be struck out.

Mrs_Bumble

Why do you need another payment break? doesn't help the mortgage balance?

jamesd

DonutUK, payment holidays are a significant feature of a mortgage and I think that this is a failure to treat you fairly by not complying with the advertised terms of the mortgage. I suggest that you formally complain to them and if they decline, escalate the complaint.

You should check all literature, including advertising, that you were presented with at the time you took out the mortgage to determine whether it specified it as simply one of the benefits of the mortgage or as something that they could choose to change whenever they wished or decline at will.

Dunstonh, if a mortgage included as a standard feature payment holidays and I took one and saw it reported as arrears on a credit report, I'd be complaining about that, since it wasn't described as arrears in the product description. Big difference between holiday as a standard term complying with the agreement and holiday as agreed arrears that will be reported as failing to keep to the agreement.

dunstonh

Dunstonh, if a mortgage included as a standard feature payment holidays and I took one and saw it reported as arrears on a credit report, I'd be complaining about that, since it wasn't described as arrears in the product description.

I never said anything about it being reported on your credit file. A mortgage holiday is just a consumer friendly name for having authorised arrears. Its unauthorised arrears that get reported on your file.

Authorised arrears/mortgage holiday (whatever you want to call it) has always been at the discretion of the lender.

jamesd

Take a look at this product description, the first hit I came across in a search of Google.

As usual the repayment holiday is described as just another of the features of the mortgage, ranking equally with the offset account feature. Nothing there to give me or any other consumer some clue that it or the offset feature might be withdrawn at any time, nor to suggest that either is more or less likely to be withdrawn.

Not that it would make much sense to overpay on an offset mortgage when you can use the offset account instead and, unless there's some hidden term allowing the lender to prevent it at their discretion, can withdraw the whole offset amount at any time without any need for more consent.

I've no problem at all with lenders making these things modifiable at their whim, so long as it's clearly declared in advance in the product marketing. Otherwise someone who might expect to use a repayment holiday feature to lower the amount of emergency savings pot that they need would be significantly misled and wouldn't have the appropriate level of savings.

Joe_Bloggs

Are flexible features just a marketing ploy when the practical use of them appear to be at the whim of the lender.
J_B.
(Worlds slowest typist)

dunstonh

I've no problem at all with lenders making these things modifiable at their whim, so long as it's clearly declared in advance in the product marketing. Otherwise someone who might expect to use a repayment holiday feature to lower the amount of emergency savings pot that they need would be significantly misled and wouldn't have the appropriate level of savings.

In that case then C&G have done nothing wrong as they do notify of changes in their booklet and i recall getting those a number of times over the years.

I'm not sure linking an offset mortgage where you expect payment flexibility to exist is quite the same thing as a standard residential capital and repayment mortgage though.

jamesd

Joe_Bloggs, I don't know, but I was curious enough to phone that lender and try to find out. The best I could get was that it would depend on whether there had been enough overpayments, with the person unable to say whether I could rely on the complete lack of discretion in the "will be allowed" wording to ensure that I could be certain that I could reduce my payments if I became unemployed or whether I would have to have an emergency fund that assumed I couldn't do that. She suggested asking a mortgage adviser in a branch.

The choice of unemployment was because that's one of the times when a lender would be most reluctant to grant permission if it is in any way discretionary.

Dunstonh, so long as the ability to make those variations was clear in the marketing materials when the product was sold that's fine with me. If it was using words like "will be allowed", which permit no discretion at all on the part of the lender, at the point of sale, that would not be good.

payless

C&G / lloyds stance
http://www.lloydstsb.com/mortgages/mortgages_flexibility.asp

whilst I have heard of paymnent holidays being granted in different cases, I have a feeling the contractual bit was only if overpaid already