Mis-selling of mortgages

lostinthefog_2

Sorry to re-visit a topic which has been covered recently, but an employee of a debt advisory service (not working on my behalf, just chatting socially) suggested I may have been mis-sold my mortgage. He said that mis-selling could be construed if the agent or lender had done any of the following:

--The mortgage was sold to me even though they knew it runs past retirement age

-- My situation was wrongly assessed (I explained that my income was not steady and fluctuated a lot)

-- The commission paid to the broker by the lender was not explained to me

-- I had to pay the broker a separate fee which was a percentage of the loan (I didn't even realise that a fee was involved until the bill arrived)


I realise that even if these circumstances are not good practice, I should have been more circumspect. I don't want to go into a claim which founders at the first hurdle, but I'm sick of being treated like a football by Northern Rock. Is there any point in going ahead or am I effectively complicit in any mis-selling ?

GMS

Were you provided with Initial Disclosure Document?
Were you given a Key Facts Illustration?

These should have detailed the fees. You should also have signed a fee agreement. If the IDD did not mention fees you have a case for the fees.

Running past retirement age is ok if income would be sufficient.

Income fluctuates. Was it a self cert mortgage? You have stated income somewhere I assume? If so be carfeul now stating it was not true. This would make you complicit in any fraud.

Be careful before pursuing any claim. You do not want to put yourself in a bad position

dunstonh

--The mortgage was sold to me even though they knew it runs past retirement age

This was popular a few years back but was abused by people trying it on. Generally, you have to prove you cant afford it past retirement (i.e. pension not big enough or lump sum from pension cant clear the outstanding balance at the time). Going past retirement is not a mis-sale. Its an additional risk warning.

-- My situation was wrongly assessed (I explained that my income was not steady and fluctuated a lot)

Doesnt make it a mis-sale though. It makes it an increased risk for a lender if they dont understand the situation correctly and still lend but it doesnt do you any favours.

-- The commission paid to the broker by the lender was not explained to me

irrelevant. Lenders have no requirement to tell what commission their staff are paid (if any). Mortgage brokers have only had a recent requirement. However, there has only been one successful court case in this situation and that was where a fee and commission were taken and the commission was not disclosed. The court ruled the commission should be returned (which was about £250 in that case).

-- I had to pay the broker a separate fee which was a percentage of the loan (I didn't even realise that a fee was involved until the bill arrived)

Fees for arranging mortgages are allowed. The fees since 2004 should be disclosed in the KFI document and the initial disclosure document. Non disclosure of a fee can lead to a refund of that fee. However, you would have to prove non disclosure after so many years (assuming its not a recent case).

I realise that even if these circumstances are not good practice, I should have been more circumspect. I don't want to go into a claim which founders at the first hurdle, but I'm sick of being treated like a football by Northern Rock. Is there any point in going ahead or am I effectively complicit in any mis-selling ?

The reasons you have given are internet myths. They have some basis of truth in that there is a potential for rule breach in some of the areas. However, you stand nothing to gain from a couple of them or such a tiny amount on another or will likely suffer the problem of you making an accusation that you cannot back up. You are not going to get anything from Northern Rock on any of those areas. The broker may have some liability depending on what evidence you can provide and what evidence the broker can provide to counter your accusations. A rule breach does not mean you automatically get redress either.

The reasons you give will need supporting evidence to stand any chance of success. What evidence do you have to support your claims? How far past retirement? What balance would you have outstanding at retirement and could your pension income/lump sum cover it? Could you afford higher monthly payments at the point of taking out the mortgage? What year did you buy your mortgage (to ascertain whether it was pre or post regulation)? Does your mortgage terms of business and KFI show the adviser fees (assuming post regulation)?

If you want to give some details, we can tell you if its likely or not to result in anything.

McKneff

--The mortgage was sold to me even though they knew it runs past retirement age

-- My situation was wrongly assessed (I explained that my income was not steady and fluctuated a lot)

-- The commission paid to the broker by the lender was not explained to me

In fairness, you also knew it ran past retirement age and still took the mortgage
even when you knew your income was fluctating you still took out the mortgage
If a broker was used you must have known that he doesnt work for nothing, of course he's going to get paid.


So Im confused as to why you think it is all someone elses fault.



-

Wh05apk

McKneff wrote: »

So Im confused as to why you think it is all someone elses fault.



-

Because someone who makes a living from making claims has suggested the OP may be able to pass the buck of responsibility for their financial situation to someone else, rather than taking responsibility for their own actions.

magpiecottage

Just to clarify the point by DunstonH.

If a broker charges a fee to arrange a mortgage or other loan and taking a commission from the lender without the borrower being aware of that commission, the broker is likely to be found to have taken a bribe from the lender. If he tells the borrower that he will receive commission then he has not been bribed.

However, if you took out the mortgage on or after 31 October 2004 you will have been given a "Key Facts" document. This will have specified both the fee you paid to the broker and any fee or commission paid by the lender.

All the broker has to do is produce his copy of that document and any claim on those grounds will fall down.

lostinthefog_2

I'm not trying to get out from under anything. I was simply told in a private conversation, not a business one, that there may have been some irregularity in the way I was sold my mortgage and that I should investigate it. I have no wish to avoid the consequences of my own actions, but equally believe that if the lender or the company who recommended them have done something questionable they are liable for the consequences of theirs.

I have no expertise in financial matters and feel like a cork on a stream at the moment, being pushed around at the whim of others, notably the Northern Rock. They have been unsympathetic to a degree I wouldn't have believed possible and I'd be better than human if I didn't check out a possibile way of getting back at them. OK, it looks very much like this is a dead end and I'm grateful to posters for their advice, but I think most people would have checked the situation out if they were in my position.

Senior_Paper_Monitor

I think you'll find that most of any vitriol expressed is aimed not at you, but at the halfwits that peddle this nonsense (including your 'social contact') together with writing off of debts under 'a government initiative', IVAs as a solution to all your problems and snake oil !

They regularly con the vulnerable/desparate into paying 'up front fees' and on the rare occasion they actuall follow up any action to broker/lender waste their time (and often actual expense) in responding - very, very rarely does the poor 'missold' (not) client recieve a penny !

Do not be surprised when the industry professionals and previously conned public start to snarl when this subject is raised again.