faulty mortgage advice Santander - advice please

jen80

Hi I hope someone can help. My husband and I have been trying unsuccessfully to sell our house and have finally agreed a part exchange price on a new build. Before paying the reservation fee I contacted Santander who is our current mortgage provider for an agreement in principle and to check they would lend on a 90% ltv on a new build. They agreed to this so we paid the deposit and instructed solicitors to start searches etc. Upon trying to make the formal mortgage applicationSantander are now saying they won't do 90% ltv on new builds. I have spoken to the complaints dept who have listened to the recording of the original conversation and have admitted to giving us wrong advice. They have offered us 30 pounds for the inconvienience
Is there any way we can get them to repay the money we will have lost that has been paid already as obviously we would not have reserved a house if we weren't sure we could get the mortgage. Do they have any legal obligation to compensate us as they have admitted fault.
Thanks in advance for any advice

Thrugelmir

jen80 wrote: »

as obviously we would not have reserved a house if we weren't sure we could get the mortgage.

A conversation with a call centre operative does not constitute a mortgage offer. As they have no authority to say whether your application will be successful. Only underwriters can make that decision.

jen80

You have missed the point of my post which is to ask if anyone knows if there is a comeback on a lender providing incorrect mortgage advice if this has been acted upon and incurred some financial cost.
I repeat the advice given was that a mortgage could be offered on a new build at 90% LTV, but it turns out lender policy is to ask for 20% deposit on new build.

brit1234

I think you have a strong case if your mortgage in principle has this on the documentation. Show the bank this and you should get the compensation.

However if someone just told you over the phone you wouldn't have a leg to stand on. Every one knows you need far bigger deposit for new builds as they are so overvalued.

holly_hobby

I assume that this is your first experience of buying a new build - so that as a layman you would be unaware that a NB has a standard lower max LTV than that offered on the lenders standard mortgage portfolio.

You did however, ring and speak to a call centre operative, to ask for guidance on the matter, whom would have had access to reference material on basic uw and current range of products, to hand.

It is proven (and admitted by Santander) that you were advised by their representaive, that the max ltv for a new build was 90% - information which you naturally accepted as accurate, and thereby proceeded with your reservation etc on this basis, incurring costs as a result.

IF, this were a case that you failed full underwriting due to personal circs, I would say as Thurls has, thats tough luck, and that there was obviously undisclosed data not revealled in the initial AIP app.

However, this is not the case - your mge app has been solely rejected at desktop stage for the reason of LTV being too high for a new build - which is in direct contradiction to the incorrect advice which Santander have already admitted they provided.

Now whilst they can't break their standard criteria, and errors do happen - I would expect their call centre staff to know such basic criteria, and for them to accordingly put you back in the position you were before you recd the inaccurate info - which is not £30, but your reservation fee etc.

If I were in this position, I would reject the £30 as derisory, and demand full reimbursement of costs incurred as a direct result of their error/incompetence, taking this through their complaints process and beyond, if resolution is not directly achieved.

Hope this helps

Holly

Thrugelmir

jen80 wrote: »

You have missed the point of my post which is to ask if anyone knows if there is a comeback on a lender providing incorrect mortgage advice if this has been acted upon and incurred some financial cost.

From the Santander website. I have highlighted Santander's own caveat.

All applications are subject to status and our current lending criteria. This means that the amount we will lend you will depend on your individual circumstances, the type of property and the amount you borrow. For example, we may require a higher deposit if you are buying a flat or a new build property.

ACG

I would be telling them that you want them to cover the costs you have incurred because of their representative.

Had they not misinformed you, you would not have incurred the costs - therefore as part of the FSAs Treating Customers Fairly initiative you expect them to reimburse you for the amount that you are worse off because of them. If it fails forward it to the ombudsman, that will cost them a few quid to have it looked into anyway.

mo786uk

Thrugelmir wrote: »

From the Santander website. I have highlighted Santander's own caveat.

Then they should have mentioned that during the call - that said the Op was perhaps jumping the gun by spending money without getting more concrete info.

Wh05apk

I would agree with Holly and ACG, they have confirmed they have mis-advised you, whether at that stage you should have instructed solictors is another matter.

holly_hobby

mo786uk wrote: »

Then they should have mentioned that during the call .

Agreed.

The crux of this complaint is that a reasonable person would expect criteria information directly provided by the lender upon request, to be both current and accurate. And that it is entirely reasonable that having recd such info, the individual should then duly act upon the same without concern.

Whilst, their website may well discuss that restrictive LTVs are in place for NB - a reasonable person would not be expected, to having sought and obtained verbal verification direct from the lender, to then also independently seek out their website to further verify that the data provided in the telephone call was indeed accurate.

Having said this, we don't have an issue of blame, as we know Santander have already admitted their negligence in the matter - our issue is that they are attempting to pacify the OP with an apology and £30 D&I payment - which in the circumstances, is simply not acceptable.

My letter/telephone call of complaint would ensure that the above was duly made clear.

Hope this helps

Holly