Compensation offer from Building Society

Rocka

Hi - I recently had a extremely upsetting experience when I extended my mortgage with my current lender, resulting in me believing that I would have to pay off two mortgages. The situation was finally sorted, though I'm still out of pocket for the extra interest that was charged and have to go through the Law Society to claim that back.

However, I made a complaint to my building society because of their total lack of information to me, lack of concern for the extreme pressure I was under - which they knew about as I was crying on the phone.

They originally offered me £75 compensation which I rejected by letter last month. I didn't hear anything back from them and rang today and after many apologies on their part, was offered £200.

The reason for my post is to ask if you think I should accept. I have no experience of claiming compensation in these circumstances so any advice would be gratefully received.

Thanks as always!
Best regards

arkonite_babe

Hi, Martin’s asked me to post this in these circumstances: I’ve asked Board Guides to move threads if they’ll receive a better response elsewhere (please see this rule) so this post/thread has been moved to another board, where it should get more replies. If you have any questions about this policy please email [EMAIL="abuse@moneysavingexpert.com"]abuse@moneysavingexpert.com[/EMAIL].

MarkyMarkD

I think you need to share more information regarding the original issue.

I don't understand why you are mentioning the Law Society, for example - nothing to do with mortgage lenders.

£75-£200 might be quite a reasonable amount of compensation for upset and inconvenience, if the original financial wrong has been righted.

But I can't tell from your post what the original wrong was, and whose fault it was.

Rocka

I ended up with two mortgages because the solicitor the building society had recommended hadn't paid off the old one. I was constantly ringing to try and find out what was happening and was eventually told that the solicitor was being checked by the Law society for fraud, therefore, any recompense of monies owing due as a result of the solicitor's misconduct I have to claim through the Law Society.

The compensation claim to the building society is as a result of them not informing me what was happening - in actual fact I was the one contacting them and when they did eventually tell me there were problems they were completely insensitive to the situation I found myself in - I thought I was having a breakdown I was so paniced. I actually got some sound advice at the time from users of this site which really helped me realise that eventually it would be resolved but as far as the building society were concerned 'I was on my own.'

When I lodged a complaint with the building society I eventually got a call from them apologising and offering me £75 and then as a result of my followup call - because they didn't respond to a second letter from me rejecting the offer - they offered me £200.

I hope this helps and makes it all a bit clearer. Everytime I think of the day it happened I get myself all wound up and my brain starts to frazzle!

As usual advice would be gratefully received.
Many thanks!

MarkyMarkD

Sorry, I must be being daft, but I still don't get it.

If you had a mortgage for (say) £50k and extended it by taking a further advance to £60k, that wouldn't involve a solicitor.

If you mean that you remortgaged (changed lender) and the solicitor failed to redeem the original mortgage, then he's clearly a complete idiot and I can see why you'd have a problem. But that would also mean he'd run off with the value of the original mortgage, or at least failed to settle it when he should have.

Rocka

No you are not being daft - I haven't explained properly. The extention to my mortgage was with the lender I was already with.

The main problem was that I hadn't been told by them that the extention would be carried out as if I was taking out a new mortgage and the full amount of the extended mortgage would be sent to the solicitor. As an existing customer, I thought they would just add the amount to my mortgage and put the money in my current account (I do all my banking with them - unfortunately!). I couldn't uderstand why there was a solicitor involved, however, wasn't concerned. As I had never extended my mortgage before, I thought it was normal.

When I eventually found out that the full amount of the second mortgage had been sent to the solicitor (and my old mortgage was still up and running) and that the solicitor was being investigated for fraud - I nearly had a breakdown. I had been trying to contact Building Society for ages to find out what was happening and when I eventually did get through they very 'coldly' to me that the solicitor who was holding the full amount was being investigated for fraud and that there was nothing they could do for me as it was in the hands of the law society. I'm sure you can appreciate my feelings at that time. The staff were completely off hand and gave me now words of support. I felt totally traumatised. I'm not pleading poverty, but I am single parent of 2 children with no extended family and all I could think was that I would have to sell the house and who knows where we would end up living!

(Can I just tell you that it was someone on this site who saved my sanity on the day all this came to a head by telling me that money's paid to solicitors for mortgages are kept in separate accounts and, therefore, the money should evenutally get through to pay off my old mortgage - which it did.)

After making numerous complaints on the phone and then sending in a letter, I was contacted after 2 weeks by one of their customer relations team who apologised for what had happened. She acknowledged that she could not understand why the extention to my mortgage had been carried out the way it had. She said that in the past it had always been a straightforward transaction of extending the mortgage and passing the extra money to the customer. She then offered me £75 by way of compensation and I asked her to make the offer in writing as I was still too upset to make any decisions. I couldn't believe that it took them 2 weeks to get in touch with me. Probably hoped I would go away.

When I wrote to reject the offer, again I got no response and after about 3 weeks of waiting I had to ring her. When I got through she told me that apparently when you extend your mortgage with your existing lender in Northern Ireland it has to be processed as if you are setting up a new mortgage. (I have never heard of anyone else here who has had to go through a whole remortgage again when extending.) I reminded her that my complaint was about how they had handled the whole situation and their treatment of me and she then asked me what I thought would be a fair amount of compensation and I said I didn't know and she then offered £200 which I again asked her to put in writing.

This has been going on since the beginning of September and I really do think they screwed up big time and have treated me really badly. Just sitting here writing it out again is making me upset.

Sorry this is so long - I hope it goes someway to explaining better. I'm still really annoyed and I feel that they should take note of what I'm complaining about so they don't put other customers through what I've been through - their customer services is appalling. I know from this site that the only way to get banks and building societies to take notice of their customers is to NOT sit back and let them walk over us - which is how I feel - trampled on.

I suppose what I am looking for here is support and guidance to enable me to pursue this further but only if you think I should. I'm not very experienced on this kind of thing.
Thanks!

wotnoshoeseh

Rocka,
I think that you owe these guys nothing. IMHO You should threaten them with the banking ombudsman to try to exert some pressure on them and to get them to explain to you in writing as to why they forced you down the route of using a solicitor.
Alternatively as I can see that the whole episode seriously traumatised you and threatened your sanity, maybe it is best to just take the money and put the whole sorry episode behind you.
Anyway whatever you decide good luck with it.

Name and shame them and be done with it.
Also you should look at Martin's website and spread some of your spending around. Don't do it all through the one bank.
Look for the best bank accounts and the lowest interest mortgage to make the most of your cash!

MarkyMarkD

Thanks, Rocka, for the improved explanation.

You are right that the building society has screwed up hugely here. They seem to have interpreted your request for a further advance as a request for a remortgage - whilst ridiculously failing to notice that your original mortgage was with them.

There was absolutely no need for a solicitor to be involved in this sort of further advance.

I think that they should compensate you - as they have - but that £200 is a reasonable amount as long as they have fully financially compensated you for all of their errors including the full costs of the solicitor (who was only involved due to their error).

I hope that helps.

MMD

Rocka

Hi MarkyMarkD - many thanks for your response(s) - the only new query I have left with them is that they didn't take the 1st months payment out of my current account (I presume because I ended with two current accounts when they set up the 'new mortgage') so I'm now worried that I've run up interest on my mortgage. I tried to get a hold of the woman whose dealing with my complaint to find out what happens about that but she's not back until Monday.

I'm still due interest charges back from when I had the two mortgage on the go and they told me I would have to claim that through the law society but the law society have indicated that they won't pay.

I have put a post on the Northern Ireland site to find out if it is normal to have to go through the whole remortgaging process when extending a mortgage here. If the answer is no, then I should have a case for asking them to refund the interest to me (I think!)

When I've got these two queries sorted, I'll feel a lot happier and be glad when the two year tie in period is up so that I can move elsewhere!

Many thanks again MMD!

MarkyMarkD

There's nothing different about Northern Ireland in this regard.

For the lender to fob you off on the Law Society is rubbish. They initiated the !!!!-up; they selected the useless lawyers. They should sort things out for you.

I'm even more despairing for what the lender was doing, now that you are talking about two current accounts having been created. D'oh!

Rocka

Hi MarkyMarkD - just thought I'd let you know that I posted on the Northern Ireland Board and got a couple of responses saying that it shouldn't be any different here. I'm going to type the wording of the letter on the site tomorrow (I don't have the letter with me at the moment). One of the people who responded to my post works for an Indpendent Financial Advisor and hopefully she'll be able to interpert what it says.

I can't believe I've got into this sorry mess, but thanks for your support. It really is great knowing that people are out there who care!

I'll let you know how it goes.
Cheers!