bad mortgage advice compensation?

haras_nosirrah

Hi OP

What is the mortgage amount

interest only or repayment

what is the % fix

what is the erc

what % equity do you have

what is the mortgage term?

Depending on the above it may be worth paying the erc and getting another rate. Without the above who knows.

thebrowski

Allow me to return comment....

We found ourselves with a mortgage that we could (barely) afford. We had no idea about different types of mortgages, independent advice, future market states etc.

We were young and new to all this and we asked our bank for help and advice because we didnt have the information or knowledge about mortgages. We then worked very hard to make the payments whilst those around us never (not even at the start) paid anything near what we were paying - confident that our bank had advised us well and that time would prove this.....It never did and our independent financial advice now informs us that "we were robbed blind".

My question was just to clarify if one can be compensated for poor advice. The replies suggest that it was not poor advice. I beg to differ as it has transpired to have been a very bad piece of advice indeed - had the market been different, I may indeed have felt differently, but it isnt and I dont.

However, I understand now that this advice would not be considered "poor" (regardless of how costly it has been) and therefore (without poor service) one would have no grounds to seek recompense.

I appreciate the practical thoughts in the responses - the unnecassarily offensive attacks had no grounds though considering I was just looking for information - I conclude that I made a poor bet on my mortgage. A more sound bet would be to wager that people who are aggressive and rude (and, yes, I thought you were rude) over the internet would be less so face to face...

To the sensible posts - thank you!

dunstonh

My question was just to clarify if one can be compensated for poor advice.

You have not demonstrated that there has been any poor advice though. Indeed, what you have added in post 13 actually strengthens the advice given in that you were finding things tight so certainty of payment was a sensible option. If rates had gone up, you wouldnt have been able to afford them.

confident that our bank had advised us well and that time would prove this.....It never did and our independent financial advice now informs us that "we were robbed blind".

As much as I dont like saying this, your IFA is feeding you a line. Yes the banks are the worst place to get advice but this is a hindsight decision. You dont buy a fixed rate to be the cheapest. You buy it for certainty of payment. Did this IFA know 7 years ago that rates would be this low now? At that time, rates had been creeping up.

I beg to differ as it has transpired to have been a very bad piece of advice indeed

Not it hasnt. Advice does not include the provision of a crystal ball. The outcome hasnt been the best one for you but the advice could not predict the future.

had the market been different, I may indeed have felt differently, but it isnt and I dont.

Exactly the point and thats exactly why its not a mis-sale or bad advice. You cant have your cake and eat it. You look at the risks, you make a decision and then only time will tell if the decision is right or wrong. The wrong choice is not a bad choice. Its just the wrong choice with the benefit of hindsight.

the unnecassarily offensive attacks had no grounds though considering I was just looking for information

This site generates an abnormal number of compensation seekers who are only looking for ways to scam firms and individuals out of money. Your first post on the site was asking about getting compensation for buying a fixed rate. So, the responses were pretty much inevitable as no-one likes a dodgy compensation seeker.

jamesd

thebrowski, what did the independent advice say as the reason for you being robbed blind? Initially it looks as though most of your pain has been caused by the short mortgage term, but you might also have got a bad mortgage deal.

opinions4u

thebrowski wrote: »

We were young and new to all this and we asked our bank for help and advice because we didnt have the information or knowledge about mortgages. We then worked very hard to make the payments whilst those around us never (not even at the start) paid anything near what we were paying - confident that our bank had advised us well and that time would prove this

By asking your bank for help and advice you narrowed your options down to one provider only. If HSBC were uncompetitive in the market at the time, then you would have been given the best product for your circumstances from their uncompetitive range.

.....It never did and our independent financial advice now informs us that "we were robbed blind".

Ask us if he would apply that to his own client base who may have bought investments at the peak of the market and sold them at the floor. Really, ask him. Those clients may feel that they have been robbed blind. They haven't though - they've been recommended investments that they new could rise or fall in value.

You knew rates could rise or fall, but agreed to fix. If rates had risen you'd have been in deep financial difficulties. Not just looking at friends with cheaper mortgages.

My question was just to clarify if one can be compensated for poor advice. The replies suggest that it was not poor advice. I beg to differ as it has transpired to have been a very bad piece of advice indeed - had the market been different, I may indeed have felt differently, but it isnt and I dont.

Banks and financial advisers don't have crystal balls. They cannot tell you which way markets or rates are going to go. They don't know and they don't advise on such thing. But if you expressed concerns over cost and unfavourable rate changes then a recommendation to fix a mortgage for a long time makes a lot of sense.

I appreciate the practical thoughts in the responses

Clicking on the <THANKS> button is a traditional way of thanking people.

luckyfool

thebrowski wrote: »

... we asked our bank for help and advice because we didnt have the information or knowledge about mortgages. ...

You didn't get advice though. If you want advice you do not go to a bank or building society as their staff do not provide advice.

Should every client I recommended a fixed rate to 2-5 yrs ago be able to get compensation from me because interest rates came down and economy crumbled. Hey, maybe everyone who takes out a tracker now can go to their adviser or bank for compensation when rates eventually go back up.

Maybe I should go back to Aviva and complain that their bad advice sold me a fully comp car insurance policy for £300, and it was a waste of money because I didn't write my car off.

SandC

Your original post states that your girlfriend at the time took out the 'world's worst mortgage'. Yet now it was both of you who were young and naive - just wondering why it's changed from your now wife who took the mortgage out to it being the pair of you taking advice from your bank?

Anyway, I guess that's by the by now as you have not been missold nor can you claim compensation for what you consider poor advice.

Is this a 10 year mortgage on a fixed rate for the entire time? Or is it a normal 25 year mortgage with a 10 year fix? You still never said what your interest rate is. If it's a 10 year mortgage fixed for the duration then you are streets ahead of your friends and will be mortgage free in 3 years so I'm thinking it's a 25 year term. In which case it's only 3 years until you can get out and find a better deal. Do check that the ERCs are not out of your reach though. It could be an option.

At that time a 10 year fix would have been unusual and would have appealed to many people, just as longer term fixes are appealing now.

I'm afraid however young and naive you are it is nobody's responsibility but yours to gain an understanding of mortgages and the pros and cons of what is available.

Cannon_Fodder

thebrowski wrote: »

We found ourselves with a mortgage that we could (barely) afford.

If you were of age; able to vote, have sex, be employed, sign a legal document, etc, then you have to accept that it was your choice.

Part of your choice was to blindly trust a sales person in a bank, instead of running the figures passed a parent/guardian/mature relative, but that again was your choice.

I suppose this website will still be here in 5 years, with multitudes of ex-FTBs complaining at the choices they made in life, as they have to make the mistakes themselves.

I wonder, if anyone had said 7 years ago "don't do it", whether the OP would have decided they knew better, anyway.

It might be particularly high compared to friends, due to a shorter term. Ask you friends in X years, when they are still paying their mortgage, how they feel about you being mortgage free...

clearing_out_my_pockets

OP - if you were aware at the time how much your friends were paying in comparison to your own monthly payments, surely then would have been the time for alarm bells to ring. If you're comfortable enough to discuss monthly payments with friends, you could (and should) have asked their advice at the time. Being young and naive shouldn't be an excuse. As a house is the biggest purchase you're ever likely to make you really should research what you're buying.

To me (and you've avoided the question) it sounds as if your friends are on interest only tracker mortgages, which would explain why their payments have always been lower than yours, whereas you're on a repayment mortgage.

In terms of getting out of the mortgage deal, how much equity do you have in the property (if any)? If it is enough to cover the ERC you could still switch lenders. Next time though, do your research...:p