Natwest Mortgage Advice Incorrect

firsttimetryer

My wife has just had our second baby. She is self employed so isn't earning any money for 6 months. Just after we found out she was pregnant I called Natwest to ask what we could do to reduce our mortgage payments for 6 months after the baby was born. In a telephone conversation with Natwest the options of increasing the mortgage term or going interest only did not give us what we thought was enough of a reduction. The advisor then said that if we wanted, we could reduce our payments by 50% for up to 6 months but that this would be recorded as arrears and would affect our credit rating. Then once my wife was working again we could agree an amount to pay back the arrears. We accepted that this was our only option and were advised to contact Natwest when we wanted to go ahead with this.

Six months later and I have just spoken to an advisor at Natwest that has dropped the bombshell that we can only do this for 2 months!:mad: I was very cross and asked to record a complaint as our financial planning was based on what the advisor told us 6 months ago. The complaints department will call me back with in 10 days.

Does anyone have any experience of incorrect advice being given and whether Natwest would honor what was agreed on the phone in my original conversation with them.

holly_hobby

Did the 2nd adviser state you had been given:-

• incorrect advice 6 mths go ?
• that their criteria has changed since your original tele conversation ?
• or
• that the current decision was specific to your current circumstances/account ?

Holly

Farmerbob

The way i've read this is that you were orginally told you can pay 50% payment for 6 months, fast forward 6 mths you have called them again and they have told you its only for 2 months? Have you paid 50% payments for the last 6 months or not?

Farmerbob

Apologies just re-read and I've read it wrong I'll go with what holly-hobby said, its been a long day! :-)

firsttimetryer

Hi Holly, thanks for the reply.

They stated that the advice would have been incorrect as paying 50% for 6 months would never have been an option.
Their criteria had not changed.
The decision was not specific to our current circumstances.

holly_hobby wrote: »

Did the 2nd adviser state you had been given:-

• incorrect advice 6 mths go ?
• that their criteria has changed since your original tele conversation ?
• or
• that the current decision was specific to your current circumstances/account ?

Holly

opinions4u

Not being funny, but screwing your credit rating for six years (from the point you bring the account up to date) to fund an event you've known about for months strikes me as barking mad.

Thrugelmir

firsttimetryer wrote: »

Does anyone have any experience of incorrect advice being given and whether Natwest would honor what was agreed on the phone in my original conversation with them.

Your application could be declined for any number of reasons. As any number of things could have changed in the past 6 months.

The options you were given originally would have been subject to a formal application or request from you. A telephone conversation would not constitute a formal offer of a change of terms. As it would most certainly would have required approval of an underwriter and required credit checks and other formalaties to be performed.

holly_hobby

firsttimetryer wrote: »

Hi Holly, thanks for the reply.

They stated that the advice would have been incorrect as paying 50% for 6 months would never have been an option.
Their criteria had not changed.
The decision was not specific to our current circumstances.

Hi,

Ok - so the "change" to the advice previously given, isn't actually a change in criteria at all, or is in anyway based on your current circs.

But instead (as apparently admitted to you), is actually due to inaccurate info being given to you in the first place i.e 6 mths ago.

Your initial post was, I think, seeking opinion on the events and your decision to submit a formal complaint.

So, from a professional point of view, here are my thoughts:-

• any business decision by a lender to agree to allow a non-contractual arrangement to take place, i.e give the facility for a mortgagor to take a payment holiday, due to financial circumstances - is done so on both a case by case and voluntary basis by the lender (it should be noted that some mortgages do have the facility to take a mge holiday as part of the contractual terms, subject to min mortgage period having elapsed and restricted by frequency per annum - indeed my own mge has this facility)
• in this case, the mge holiday appears to be in respect of forecast repayment difficulties, where your recollection is that the call centre handler, advised that you may be allowed up to 6 mths @ 50% - with the option to repay the arrears once your wife was back in employment
• Natwest state that this facility is not their business practice, and this option in essence does not exist (and would not have been advised to you ? was this their view ? )
• I have to admit that the 6 mth arrears arrangement does sound very generous - but then again I am not an arrears consultant for the bank. Have the bank denied you would have been given this info or accept that you were told this and that the call handler was wrong ? Have you asked for a transcript of the tele call ?
• Having said that, and notwithstanding the fact that you may have been given inaccurate information, the bank are unable to offer you a facility which they do not operate as part of their normal mandate - as this would be unfair to those customers who have been refused the same request due to it being outside of their account management criteria.
• Further to which, your personal situation i.e new baby and financial difficulties, is not the direct result of any inaccurate info being provided by Nat West 6 mths ago, as you didn't enquire about the payment holiday, and then solely based on the availability of a 6mth holiday period, elect to expand your family - and thereby have incurred financial difficulties/hardship as a direct result of the banks error.
• Indeed, at the time of the initial call your wife was already pregnant, your call to Nat West being an attempt to manage your anticipated reduced future finances around the forthcoming event - and seeking the assistance of Nat West in this matter.

Having considered all the above, I do believe that the v best you can expect from the bank (or FOS) if you take it there, is the 2 mths reduced payment schedule already offered, admission of error by N West and a possible D&I payment.

If you get nothing from either, you may appeal a FOS adjudicators decision to an Ombudsman - with their decision final and not open to appeal (next stop being pursuance through the judicial route).

I do hope from the above points, that although maybe not to your liking (i.e you won't be able to have 6 mths @ 50% mge payment, later making up the arrears), the reasoning behind the conclusion I think the bank/FOS will take has been explained. :cool:

I do hope this helps

Holly

dunstonh

They stated that the advice would have been incorrect as paying 50% for 6 months would never have been an option.

It may not be as simple as that. Going into arrears with permission is typically a last resort action. Its not something a normal bank clerk would typically authorise but would require someone further up the chain.

You dont intentionally destroy your ability to credit for half a decade (After you get back from arrears - which could go well past a decade potentially).

The lending discretion of managers can change. One manager may agree an action but another may not. Criteria may change. The level of discretion may change.

With regards to any complaint, the FOS cannot force Natwest to give you what you want. The FOS has no ability to interfere in commercial decisions unless it is in respect of discrimination.

There may also be an issue over whether you can prove what you were told. People who need money often tell lies. I am not saying you are. Don't get me wrong. I am saying that without evidence to support your position, they will try to identify the staff member and the context of the conversation that took place. If the staff member says they said no such thing and there is no history of that staff member agreeing any other similar arrangement then the balance of probability decision that would need to be made, swings towards the bank.

Even if you have evidence, the bank can say the person was wrong and it was an error. They still don't have to honour it as it was a genuine mistake.

As HH says above, the most likely outcome, where there is no evidence, is that they will use wishy washy language to say they dont offer such a facility and if you were told that then they apologise but they can find no record of such but are willing to offer you a goodwill payment of £50-£100.

SouthCoast

Having problems with your mortgage payments?

http://mortgagehelp.direct.gov.uk/default.aspx

firsttimetryer

Thank you everyone for your replies/advice.

I have just got off the phone with customer care at Natwest and the advisor had listened to the call I originally made in January.

She agreed that their advisor in January had said that we could pay 50% for six months and they would therefore honor that. The underpayments would be recorded on our credit file as "by prior arrangement with the lender" and would therefore not cause much concern with future credit applications.