Mis sold mortgage through a brooker

carlaeliza · 26 July 2011 at 6:25PM

I want to know if there is anything i can do, its very complicated but il try and explain the best i can

I bought my apartment as a new build in 2005, I was sold a scheme called easy buy with Crest Nicholson. I was working for a year in between my second and third year of a degree, and my husband at the time was working in a shop full time, we never expected to be able to get on the property ladder but went to an open day to nose around the new builds. We were encouraged to take a financial assessment with there adviser who was from a company called the Emerald partnership, and after a chat he told us we could get one of the apartments. He asked us our earnings and then said hed need to base it on projected earnings, so he asked if i was qualified what would i earn and if my husband was promoted what would he earn, then he went away and came back with a deal for an interest only mortgage. we were over the moon and shocked! however we could not afford the mortgage after the interest rate changed and ever since have struggled!! my now ex husband became mentally ill and so that put pressure on and then i was left on my own with a mortgage. The easy buy scheme was an interest free second mortgage for 10 years, however as the apartment is in negative equity and we had a 100% mortgage I am stuck and unsure what my options will be in four years when i need to pay back the easy buy loan! I should not have been offered that mortgage, it was out of my means and we were not earning enough! but at the time we wanted to be off the renting market and it seemed so great!

I had not thought about the fact it was mis sold untill my neighbour (who's flat has been on the market for 2 years!!) told me she was in the same boat and mentioned she felt her mortgage was sold to her when she could not afford it and also not fully explained ect..... we had the same adviser!

ID APPRECIATE ADVICE AND NOT MORAL OPINION ON MY LIFE PLEASE>;)

holly_hobby · 26 July 2011 at 6:42PM

carlaeliza wrote: »

I should not have been offered that mortgage, it was out of my means and we were not earning enough! but at the time we wanted to be off the renting market and it seemed so great!

ID APPRECIATE ADVICE AND NOT MORAL OPINION ON MY LIFE PLEASE>;)

If you are saying that the broker, with your knowledge and signature to the application, submitted inaccurate income figures - there is little you can do, unless you want yourself exposed to prosecution for mortgage fraud.

That sounds harsh, but is the simply fact of it.

The broker may have (wrongly) presented to you a solution to the pch of your home - but you knew from outset that the submitted salary figures were inaccurate/misrepresentative of the true facts, and that as you put it yourself "it was out of your means".

Although the submision of misleading info may have been instigated by the broker, you were wholly complicient in its execution.

I know that you asked for replies not to discuss the moral grounds of the situation you find yourself in, but one can't give the advice you seek without discussing the other.

IMHO - I don't believe a submitted complaint would be upheld in your favour against the adviser or brokerage (although his actions, if correct, are unlawful) - although criminal proceedings could very well ensue. As you have confirmed yourself that you willingly complied with his suggestions and actions - signing the mge app (which in doing so cites your confirmation that all info contained within the app is true and accurate).

The result of the submission of such a complaint for investigation, relaying the facts you have, would instead open one hell of a can of worms for all parties concerned - with some serious fallout.

However, this is only my opinion - you must of course proceed how you see fit, and whilst I don't condone what took place, the comments I have made, are in order to protect you from possible prosecution. (and certainly not for the benefit of the adviser)

With regards to the property and repayment of the 2nd loan, one can only hope the market picks up sufficiently to allow the sale of the property and payment of all secured loans.

Hope this helps ... with apologies if the answer given is not what you wanted to hear ... but I wish you well.

Holly

carlaeliza · 26 July 2011 at 6:52PM

thanks Holly, My only concern is, I don't remember signing anything with salaries on it?! I know this sounds stupid but we had so much paperwork and so many different things to sign and to read, i don;t think we were aware of anything happening that was not allowed, he gave the impression what he was arranging for us was normal and just a bloody amazing offer!

holly_hobby · 26 July 2011 at 7:04PM

The "salaries" would have been documented within the mge application form, and whilst you infer the broker completed it, both you and your partner had a duty of care to check the information was correct and accurate before you signed it.

But as you say, you already know that the income figs submitted were inaccurate (even if as you say you don't recall signing to verify them), as you knew from outset (and before the app was completed and submitted) that your true salaries were not sufficient enough to support the amount of mge you required.

Unfortunately, the "I didn't realise" argument won't really cut it with either the lender or the courts - so my original comments stand I am afraid.

I do sympathise for your situation and feel that you may have been a little nieve - but unless you can prove he put your arm up your back or a gun to your head to sign - then I am afraid there is no mileage in complaining about the "advice" given, simply because now you can't afford the mge and your property is in neg equity.

I feel as though I'm being really negative - indeed I will always endeavour to look for a positive solution or advice, but in all honesty there is nothing positive I can give you in this situation.

Holly x

brit1234 · 26 July 2011 at 7:38PM

Is bankruptcy an option? You are not alone taking out a self cert / liar loan they were widespread and partly responsible for the housing bubble.

It may be worth going to the citizens advice bureau or look up self cert help on google.

Good luck.

Credit-Crunched · 26 July 2011 at 7:43PM

Well put Holly, sadly Naivety is not grounds to challenge a mortgage application.

Basis of contract law requires certain attributes to be in place to have a legal binding contract

Proposal and acceptance - you sign the mortgage application
Consideration -your flat
Capacity of parties to contract - both 18+ and of sound mind
Free consent - you chose to purchase the property

Sadly these are all in place in your situation, albeit morals may be lacking on the brokers behalf. However, we are trying to nip any expensive legal proceedings in the bud. You are just going to have make do with a bad situation