Misleading Mortgage Broker Quote- leading to hidden fees- Help Please

steve888

Dear Forum Members - thanks for taking the time to read this. I hope you can advise me on the worrying case

a mortage broker ( who was not providing an advice service) gave me a Key Facts Illustraion KFI for abbey mortgage that I had requested- and failed to mention the arrangement fees in the Key Facts Illustraion( the abbey 299 setup fee for the mortgage- was mistakeldy left out by the broker in the KFI) . I proceeded in good faith with the broker , I was unaware of this hidden fee and now that I have got my mortgage the setup fee of 299 has been added by the abbey to my loan.

I am going through the brokers complaints process but the broker has said they probably cant do anything about the admin error on the FEEs section of their KFI relating to the abbey mortgage that I requested- as it was an admin error- but surely they should not give out misleading KFIs to attract customers and then take no responsiblity to the consumer for the error. I will take this to the FSA but this will all take time.

The broker was not providing advice but was merely asked for a specific abbey product. I understand that the broker did earn commission from the abbey for handling my application.

Should I reasonbly expcet the broker to refund me for the 299 abbey moratge setup fees that I was unaware of ? Can I have any redress on this matter-

I am just looking for some general advice now that the broker has said they cannot help me with the 299 fee-

many thanks for your help-

Steve

payless

On one hand I would say that the broker was liable ( and if he obtained the KFI from either the lender or one of the software providers he should take it up with them)

HOWEVER , if this was a product that you requested, then surely you knew about the fee already.... how did you research the product

payless

No need to take it up with FSA ( unless you believe , it was their intention to mislead) ... until you have exhausted their own inhouse compliants procedure.

steve888

payless wrote:

On one hand I would say that the broker was liable ( and if he obtained the KFI from either the lender or one of the software providers he should take it up with them)

HOWEVER , if this was a product that you requested, then surely you knew about the fee already.... how did you research the product

Dear payless

I had seen the headline rate in the press- but wanted to get the detailed quote from the broker-
I had assumed that all the fees etc would be listed on the KFI ( most of them were listed on the KFI ie valuation , booking fee etcetc except for the 299 fee)
On this basis I completed the application and sent to the broker. I now need to find out what is reasonable in the circumstances- so I can persue my complaint fairly ( anyone can make a mistake I know but the KFIs are supposed to be comprehensive)
any further advice appreciated

Steve

dunstonh

If it had been an advice case you would have a stronger case for getting the £299 paid. However, as it was execution only, you have a much weaker case as you chose the product and it was your responsibility not the advisers to make sure you knew the fees.

Clerical errors happen and the ombudsman wont rule against the adviser unless you are financially out of pocket because of their actions. As you chose the product and not the adviser, I dont see why the ombudsman would rule in your favour.

payless

What did you benefit from going to a "non advising" broker rather than a fees free adviser

payless

Was the fee detailed in the mortgage offer..

dwight-van-man

The problem with this type of case is that its entirely possible that the sourcing system the broker was using is to blame and that the infomrmation the brker provided was, as far as he/she knew, correct. I am dealing with a similar problem where one of the brokers I represent made a recommendation to a client based on sourcing system research, but discovered when the offer was issued that the rate he had sourced was showing the wrong fee on the KFI. The client has pursued the brokers complaints process and the broker in turn has raised it with the sourcing system company.

Just make sure you exhaust the complaint process with the broker before taking it to the FSA otherwise they'll just refere you back to the broker and prolong the process. Good luck!

steve888

payless wrote:

Was the fee detailed in the mortgage offer..

Hello Payless yes the fee was in the application from form the Abbey - but at this stage I went back to them to confirm that there were no other fees ( other than the ones quoted in the KFI) and they emailed back to retiterate the figures in the original KFI were correct and ther were no other fees

As They appeared to have had a broker this exclusive deal - which wasnt available through abbey direct - I assumed that the fees were therefore not applicable
and that is why I went though with them originally.

They now state that the person who emailed me back to confirm the fees when I questioned it following on receipt of the abbey application form made an admin error by just referencing the original KFI

So I did try to get a second email confirmation on fees after reading the paperwork- hence my frustration now

Steve

payless

Fees would not be on application , unless the broker pre-populated.

If fees were mentioned on this and then the offer , I think it woul;d be fair to say you should have queried it ( or stopped application at that point ... possibly asking for refund of any fees paid to date)

If the broker
1. made an error on KFI
2. When asked , told you ithe KFI was right
This is 2 errors ... so not looking good, but as I said , if it was detailed on offer letter, I think you have a potential shared responsbility if you proceeded without further clarification at that point.

steve888

payless wrote:

Fees would not be on application , unless the broker pre-populated.

If fees were mentioned on this and then the offer , I think it woul;d be fair to say you should have queried it ( or stopped application at that point ... possibly asking for refund of any fees paid to date)

If the broker
1. made an error on KFI
2. When asked , told you ithe KFI was right
This is 2 errors ... so not looking good, but as I said , if it was detailed on offer letter, I think you have a potential shared responsbility if you proceeded without further clarification at that point.

Thanks I can see what you are saying which is essentially both parties are responsible - perhaps I should have queries it a third time when it was outlined on the mortagage offer itself.
However it would be fair if the broker recognised their error and say offered to pay half of the 299 fee that was omitted from the KFI.- wishfull thinking I know but the KFIs are there for purpose I hope. It is shame when things go wrong the consumer cant repy on this KFI guidance for execution only brokers.

Steve