Mis-sold 2 mortgage offers from the same IFA

MoneySavingPoon

Hi,

I think I have been mis-sold 2 mortgage offers from the same independent mortgage firm and was wondering if this should be referred to the Financial Ombudsman Services as I’m having no luck with making complaints with them.

I took out a mortgage offer dated 4th August which the offer expired on 30th Nov and paid a £499 booking fee upfront. When I signed the documents, I asked the Advisor what happens when the offer expires, he said I could get an extension, but later found out it was not possible as the product also expired on the same day.

My house purchase did not complete before the offer ended, by that point the Advisor had left the company. I had no alternative but to take out a new offer and product of which it was all done over the phone and was not ask to sign any documentations NOR I was not given a hard copy of the Key Fact Illustration, which I understand is in breach of the FSA regulations.

I was also told that the new mortgage offer expires in May 2007 of which I agreed to pay another booking fee of £699 (money I don't have). Only when I received my offer pack direct from the lender, the mortgage offer was only valid until 31st Jan 07 and not May, or Feb as she originally said. I called up the IFA and was told that the valuation from the previous offer expires on that date!!! Why was I not told that information upfront or I would not have agreed to part with £699 booking fee!!

I told them I did not get the Key fact Illustration yet they are saying that on their file it said it had been sent to me. There had been lots of errors along the way and dealing with various people that makes matter harder.

Can I have opinions on if I have a strong case to approach the Financial Ombudsman Services??

Another question: If I had added the booking fee onto the mortgage and the offer expires, will I still need to pay that booking fee as oppose to paying upfront??

Many thanks in advance,
Annie

Rick62

Yes, I would always recommend adding the booking fee (or mortgage product fee) to the loan, almost all lenders alow this, then if for any reason the mortgage doesn't proceed you do not pay the fee.

You say they did not give you a hard copy, did they email you a copy? Make a formal complaint first to the broker firm, from what you have said you may have have a good claim.

dunstonh

Can I have opinions on if I have a strong case to approach the Financial Ombudsman Services??

No. You have to go through the internal complaints proceedure of that company first and be rejected before the FOS will even look at you. If you feel they have not served you well, then put your complaint in to company.

You may want to speak with the mortgage company owner first though to see if he/she wants to do anything about it before a formal complaint is lodged. There could be a misunderstanding which is quickly resolved rather than a long drawn out complaints process that, if it goes to ombudsman, could take over a year to resolve.

Another question: If I had added the booking fee onto the mortgage and the offer expires, will I still need to pay that booking fee as oppose to paying upfront??

I will leave that one of the mortgage advisers to answer. As an IFA, I do not transact mortgage business.

MoneySavingPoon

Thanks for that!

The first mortgage offer I bought, I was sent the illustration via email then when I went to sign the paper work I was then given the hard copy. Is this in breach of the FSA rule too?

For the second mortgage offer, I did not receive any form of illustration via email or post yet they are saying it was noted on file that it was sent out to me. I make a formal complaint over the phone with the Manager yesterday to resolve this and she said that my second offer was not mis-sold, even when I was told by her assistant that the offer will end in May 2007 but when I received my mortgage pack from the lender it said it will expire on 31st Jan 2007. I phoned up the intermediary and found out that the valuation expires on that date and that there was no way of them knowing this when my booking fee was paid. Surely, the assistant should have found this information out as I only agreed to pay the product fee upfront because I was told it was going to end in May 2007. If I had received the illustration then I would of known at an earlier stage and then could of questioned this instead of finding out after paying the fee.

There had been several blunders in communication, which is why I don’t believe them when they said the illustration was sent to me. It was the same girl that misquoted me the expiry date of the mortgage offer and it allegedly her that send me the illustration that I never received. I will never recommend this company to anyone.

toonfish

Why is it taking you so long to complete on the loan? Would be interested to know the lenders too, as most will renew the offer at least once.

MoneySavingPoon

There was a long chain of 5 properties. The mortgage offer started on 4th August and it expired on 30th November. I asked what will happen if the offer expires before I complete on the property, the Advisor (who has now left the company) said I can get it extended. Only 3 weeks before the offer expire I was then told that I can't get an extention to the offer because the product expires on the same day. I was not aware of this when I was sold because the Advisor said I can extend this. The lender is Abbey.

toonfish

MoneySavingPoon wrote:

There was a long chain of 5 properties. The mortgage offer started on 4th August and it expired on 30th November. I asked what will happen if the offer expires before I complete on the property, the Advisor (who has now left the company) said I can get it extended. Only 3 weeks before the offer expire I was then told that I can't get an extention to the offer because the product expires on the same day. I was not aware of this when I was sold because the Advisor said I can extend this. The lender is Abbey.

Abbey should have extended it, I would speak to them yourself. Either way they ought to offer you the replacement product if that one has expired, without another booking fee. If the broker can't sort it out they are speaking to the wrong people at Abbey.

MoneySavingPoon

I have spoken to Abbey a few times and they will not extend it as the product has expired. Abbey are helpful but keep on referring me back to the intermediary, as they are the ones who sold me the offer.

The advisor/s have spoken to the people at the Abbey Business Development Unit and they are not willing to give me a refund back as the system said there is nothing due back to me. But, I think I have been mis-sold on two occasions. For the first offer I paid for, if the product had last for the duration of the offer then it would see me to 4th Feb 06 - the product only had a short shelf life of just under 4 months. Considering there's a chain of five properties, a product of just 4 months, I think, is not sufficient.

The second offer will only see me until end of Jan when I was told, verbally, it will expire in May, which is why I stumped up the booking fee again.

UK007BullDog

I second what was said by a previous poster that if there is a long chain to get the booking fee added to the loan and once you are 100% sure that the mortgage will go ahead you can change it and pay the fee upfront! Just a tip!

Also there is no money due to you as:

The lenders buy the money they lend to people for mortgages on the "open market". They are able to buy batches of money, this then gets allocated, if the mortgages come rolling in this money reduces until all is gone. Also during the time you were trying to secure a deal the Bank of England raised their rates two times. This has obviously an impact on the rates the lenders get when buying the money to lend to their customers. Hence the short expiry dates as the lenders expect another rate rise. Every deal has an expiry date and on the Key Features document you got it will be on there.

If they sent you the IDD and Keyfacts via email and you then got it handed as well then they are covered and have done the right thing. If you did not get the second one at all then it would be an issue. However if they can prove they sent it to you you have no leg to stand on.

Abbey cannot help in this you need to send in a letter by registered post to the intermediary and if they are part of a network to them as well. Clearly state your grievances and give them two weeks to reply to your letter.

Hope your house purchase goes forward quickly. Have you found a property you want to buy and are the sellers happy to wait until you have sold yours?

MoneySavingPoon

Hi,

I understand this is not the fault of the lender Abbey and I understand that there's no reason why they should refund the booking fee. What I am not happy about is with the intermediary. They had withheld information from me about the product expiring the same day as the offer when I went to sign the documents, I was told I can extend on the offer but only find out 3 weeks before the offer expires I can’t do that. I feel I have been given a short mortgage offer when I told him that there is a long chain of 5 properties involved.

The second offer I bought, it was agreed over the phone that the offer will expire in May then I received my mortgage pack from Abbey to say it will expire 31st of Jan 2007.

I did not receive a key fact illustration in the post but their files said it was sent out to me and did not sign any documents to take on this new second mortgage offer.

If I had the illustration, then I would of questioned the length of the offer with the intermediary instead of doing this now trying to back my money from them as I feel I have been mis-sold on the grounds of the length of offer. As I had made them aware of this when I made my formal complaint, what is to stop them from creating a backdated letter to say they have sent it. The only way I can see that I will not have a leg to stand on is if it was sent registered post and it was signed for.

I am taking the matter up with the intermediary and not the lender itself because I feel I have lost out financially and that they did not disclose relevant information (first offer: not telling me the product expired and that I could get an extension which I couldn’t & second offer: I was told it will expire in May but mortgage pack says 31st Jan –pls refer to 4 post down for the explanation of this short mortgage offer)

I'm a first-time buyer and still waiting of the orignally house I placed an offer on. If the product of the first offer did not expired or I was sold a product which covered the duration of the offer that me until 4th Feb. In hindsight I understand more now then at the time when this was happening.

dunstonh

what is to stop them from creating a backdated letter to say they have sent it.

What is to stop you saying you didnt get it when you really did?

Issuing a KFI is straightforward and there is no reason at all to see why it wouldnt be sent out. KFIs are dated at the point they are created so they couldnt go back and change the date now.