When things go wrong with an IFA

steelwind101

Hello Guys

I have just had my mortgage offer come through which is good however i had some issues with the IFA in the process.

In the end i had to contact the mortgage company on my own to check on the status of the mortgage. Of course the IFA's office was saying it was not issued but the mortgage company confirmed that it had been.

Having already instructed a solicitor half way though the process it was clear the mortgage company would not deal with my solicitor. The mortgage company say this is something my IFA should have told me as they have all the details. Bills remain from the first solicitor etc.

The IFA's office then recommended some solicitors they like, all of course were ££££ and 35+ Miles from our house! I live in London as if there are non locally.

From the above point onwards the acutal IFA himself was never avalible to talk to. Previously he had range of "other products" (insurances etc) for us and we never heard from him. Presumably after issues with solictors and him having to contact us.

The IFA worked on a bases of "no mortgage - no fee". A lot people, including those from the vender and my previous solicitor are suggesting that i should not pay. I dont know if legally this right or if they have broken any terms.

Certantly i did not expect to have to sort out the final part of the mortgage myself. Also costs have been incurred as a result of what now seems quite clearly his mis/lack of advice.

Does anyone have any advice with this?

Thanks
Ian

kingstreet

Ok. First issue. Was the broker (you're sure this is an Independent Financial Adviser?) providing advice and arrangement of the mortgage or advice only? Which lender were you introduced to?

You should have been given an Initial Disclosure Document at the outset which explains the broker's status, remuneration and service. What does it say about how the broker sources products?

Next, what does "no mortgage - no fee" mean? Was the broker receiving commission from the lender and/or a fee from you? If you're to pay a fee, when would it be payable? What does your fee agreement and KFI say?

Was the first solicitor you chose at the recommendation of the broker? Did the broker introduce you to a solicitor he knew wouldn't be acceptable to the lender?

dunstonh

If the mortgage adviser recommended the solicitor then they have a duty of care there to make sure the solicitor is one you can use. If you chose your own solicitor then your solicitor would typically know the restrictions they may be under as its normally only sole trader solicitors that lenders don't like. The other occasion is with shared ownership schemes were often you have to use specific solicitors. The adviser would not know in most cases that a solicitor you chose would not be acceptable until a lender told them.

What was the reason why your solicitor could not be used?

A lot people, including those from the vender and my previous solicitor are suggesting that i should not pay.

That would be silly as it would allow you to be taken to court for not paying a bill you are legally required to pay. Also, it isnt clear at this point whose fault it is. Your vendor wouldnt have a clue. Your previous solicitor could be pointing fingers when it is actually their fault and the adviser wouldnt know unless it is special scheme that requires a specific solicitor.

steelwind101

Hello

Thanks for your questions, I was using and IFA. I recieved advice free and the mortgage was provided on the basis that if i went for a mortgage from him then i would not have to pay unless he was sucessful in obtaining one.

The IFA was "whole of market" and he introduced me to KRBS.

The first solicitor was my own personal solicitor chosen by myself. The home is one of those part ownership offers. Therefore i had to provide details of my solicitor and my IFA/mortgage loan organisation before we got in to the nitty gritty of the mortgage. The IFA knew that i would have to do this and did not advise me that i needed a specific solictor i believe KRBS uses a "closed list" (no knew solicitors can be added, even though this is against the Law Society rules). There are only about 28 solicitors in the whole country who can currently deal with KRBS.

KRBS say these details are provided to the IFA in the application pack. After trying to find a specific solicitor that could work with the IFA i was too, after sometime was provided with this set list.

The IFA was provided to me by shared ownership company. I had to attend, I did not have to take his advice or purchase a product from him. I did proceed with him as at first he did seem to be quite competent.

In theory i do understand i do probably need to pay him. He advised a product, i took it, he filled out the forms.

What I am trying to gather is given that im now out of more money due to his incompetence re: the whole letting me sail with the wrong solicitor when he knew from the start he needed to advise me of the closed list, 28 solicitor senario. Do i have a leg to stand on saying that he i should not pay b/c i need to pay others for his incompetence?

I did take this up with him when he realised what was going on. He quickly dismissed that that i was with a solicitor already and pressed on that i need to change. I explained everything else how he should said and he treated it as mute point. The home providers also pressed him on this and he treated as a topic that was not up for discussion. Basically, it had happened he couldent change it and he was telling me now that it needed to be different and i had to accept that regardless of costs.

Thanks
Ian

steelwind101

Hello

With monday fast approaching does anyone have any thoughts on the above. No doubt a barrage of calls from the IFA's office will be upon me!

Thanks!