Advice Please

wllcnur

My husband and I remortgaged in January 2007. We made the big mistake of consolidating all our debt and took out a mortgage for just over £210000 on our property valued at £230000. The mortgage was arranged via a so-called inependent broker who charged £1700 for his services. The mortgage lender, Preferred Mortgages applied a charge of £2070 which was also paid to the broker. On the list of fees this amount was stated as a higher lending charge as the amount borrowed exceeded 75% of the property value. At the time we assumed this to be right but are now wondering if we should have paid so much? Anyone got any advice?

Ditch_Crawler

wllcnur wrote: »

My husband and I remortgaged in January 2007. We made the big mistake of consolidating all our debt and took out a mortgage for just over £210000 on our property valued at £230000. The mortgage was arranged via a so-called inependent broker who charged £1700 for his services. The mortgage lender, Preferred Mortgages applied a charge of £2070 which was also paid to the broker. On the list of fees this amount was stated as a higher lending charge as the amount borrowed exceeded 75% of the property value. At the time we assumed this to be right but are now wondering if we should have paid so much? Anyone got any advice?

You're havin a larf, rite? After three and a half years (nearly), you 'wonder' if you should have paid so much?

It's time to wake up...

wllcnur

Thanks. Had hoped to get some constructive advice! Now I understand the "barking dogs"!!:)

VIGILANT22

wllcnur wrote: »

My husband and I remortgaged in January 2007. We made the big mistake of consolidating all our debt and took out a mortgage for just over £210000 on our property valued at £230000. The mortgage was arranged via a so-called inependent broker who charged £1700 for his services. The mortgage lender, Preferred Mortgages applied a charge of £2070 which was also paid to the broker. On the list of fees this amount was stated as a higher lending charge as the amount borrowed exceeded 75% of the property value. At the time we assumed this to be right but are now wondering if we should have paid so much? Anyone got any advice?

A HLC Higher Lending Charge , also known as a mortgage indemnity guarantee (MIG), is a fee charged by a mortgage lender where the amount borrowed exceeds a given percentage of the value of the property. This fee may be used by the lender to purchase an insurance policy designed to protect it (the mortgagee) against loss in the event of you defaulting and ceasing to repay your mortgage....This is not payable to a broker...

Ditch_Crawler

wllcnur wrote: »

Thanks. Had hoped to get some constructive advice! Now I understand the "barking dogs"!!:)

OK, you win! But, seriously, what do you expect to achieve after more than three years?

DC

wllcnur

Haven't moved mortgage much over the years and tend to get overwhelmed with all the fees/charges. I suppose we made the mistake of trusting the lenders & brokers. Just wondered if we had any cause to complain.

Ditch_Crawler

wllcnur wrote: »

Just wondered if we had any cause to complain.

Have you been worrying about this since January 2007?

VIGILANT22

Complain about what?...I explained what the HLC is....you borrowed 90% with an adverse lender...this charge is normal..........

Thrugelmir

wllcnur wrote: »

Thanks. Had hoped to get some constructive advice! Now I understand the "barking dogs"!!:)

By consolidating debt you've saved interest. The fees are the price you pay though for doing so. Some years back HLC's were standard practice on higher LTV lending. Now lenders charge higher product fees across the board to increase profitability.

HelpWhereIcan

You do not seem to have cause for complaint with regard to the Broker fee or the Higher Lending Charge as, despite your confusion about the beneficiary of the HLC, you were aware of them at the time you took the mortgage out.

However...

The broker will have had a responsibility to assess the affordability of your proposed debt consolidation.

The fact that you were put with Preferred suggests adverse credit, self cert or both.

If you had any adverse credit at the time you proposed to consolidate the debt my network would have insisted that I assess whether it was the right course of action for you.

i.e Were you actually likely to be just buying some time before slipping back into arrears and further issues? If so, it is possible that the broker did not do the right thing by you and should have at least given the advice not to proceed and to find other ways such as debt management, IVAs, bankruptcy to deal with your unsecured creditors.

They should also have explained the consequences of securing the debt and the fact that the total cost would likely to be higher despite a lower interest rate e.g. a loan with 5 years left will cost more if added to a mortgage with a 20 year term even if the interest rate is lower.

If your mortgage was a self cert was this done with your knowledge and was your income inflated or falsified to get the loan amount required?

It is very unlikely that Preferred was a suitable lender for you if you had no adverse credit. The FSA has expressed concerns many times about clients being placed with 'non-conforming' lenders when a 'high street' deal may have been available.

To make an accusation of mis-selling is serious and should only be done if you have genuinely received bad advice. Many people have been tempted to make speculative claims and a number have been false; however I have seen things over the last few months that have changed my opinion of some of my former/current peers. I have seen people that have been blatently been mis-sold to and who deserve every penny of any redress they get.

Most advisers worth their salt will have cases like yours very well documented so would have nothing to fear in defending a spurious speculative complaint.

If you genuinely think you were mis-sold to, please post more details of your position at the time and why you think the mortgage was inappropriate.

The charges are not going to be worth pursuing unless they are unfair like Kensington's http://news.bbc.co.uk/1/hi/business/8615870.stm and for going into arrears.