Mortgage Consultant mis sold mortgage and I started to go ahead!

HugoSP

I never thought the intermediary I have dealt with over several BTL and Homeowner mortgages would do this to me but....

When asked to trawl the market for current remortgage deals on my behalf the IFA got two products offered by the same lender confused, and I ended up thinking I was going for a low rate and free valuation plus £250 cashback towards conveyancing.

This is backed up by a printout on behalf of the lender from the advisor with the above incentives specifically mentioned in hand writing starting "This product also comes with......"

Today I received the offer in the post. I was shocked to find that neither the cashback or the free valuation (which has already been carried out!) were included. I have not yet received a bill for the survey.

I now realise that going with the company would cost me more than sticking with the current lender, as the cashback and the free valuation do not apply.

The contact I have dealt with there previously has admitted the mistake on behalf of the intermediary. He has assured me that any cost I incurred in progressing this application (survey and legal etc) would be refunded in full by the intermediary.

My only concern now is that the deal originally offered by the current lender is still available, which I think it is, and that the deal can be finalised before the variable rate (costing an extra £150 per month) kicks in. The reliable and dependable contact is on the case.

Questions:

Whilst I would guess it is given that costs incurred in going for a mis sold product should be re imbursed, would I also have a case if, due to bad advice, I had missed a genuine deal that could have served me better than those available to me now?

If the mortgage lapses into the varible rate because I have wasted time chasing this non existant deal, could I claim back losses that I would not have incurred had I been given correct information? Realising that deadlines were impending, I acted promptly and without delay to effect a remortgage to co incide with the end of the fixed rate period of the current product.

Lessons learned:

1) Make sure you and the IFA are fully aware of the costs of the mortgage, and how they compare with other options. I was (or at least I thought I was) looking at the total costs of the mortgage over the fixed rate period. This should include everything from the interest payment total to the set up and arrangement fees, and even the £25they may charge you for finding your own insurer!

2) Get the IFA to back up their findings in writing. e mails will not do. The person I dealt with left the intermediary soon after and fortunately I had original correspondance from him. This was faxed to the intermediary whereupon they immediately conceeded the error.

3) Check the offer carefully with the IFA if necessary. Don't accept what I was told today by one member of staff who said "That is just the way it comes off the computer" when figures do not appear to be correct.

dunstonh

Rather than post on here, have you thought about speaking with the IFA?

There could be a genuine error by the IFA or the lender which is resolved quickly and simply. There may not even be an error. I dont see why the free valuation would be mentioned on the offer letter and the cashback may not be either apart from the tie in that goes with it.

If you are that worried about timescales and getting the right deal, then you should be in discussion with your IFA. Not talking about mis-sales and bad advice when there could be none.

HugoSP

Thanks for your reply.

dunstonh wrote: »

Rather than post on here, have you thought about speaking with the IFA?

I am, I'll re read my opening post in a minuite but I thought I'd mentioned this - sorry if I hadn't.

There could be a genuine error by the IFA or the lender which is resolved quickly and simply. There may not even be an error. I dont see why the free valuation would be mentioned on the offer letter and the cashback may not be either apart from the tie in that goes with it.

We have already got to the bottom of the error. It was the IFA who is no longer with the company who got two products confused. The incentives were attached to a product with a higher interest rate, not the low interest rate product I was going for.

If you are that worried about timescales and getting the right deal, then you should be in discussion with your IFA. Not talking about mis-sales and bad advice when there could be none.

The IFA and I are clearly in agreement over two issues:

1) The information I was given was incorrect, I was being lead to a product that simply does not exist - a confusion between two that do. I would have either ended up paying more interest or lost money on no incentives - thereby spiralling my costs to over and above that of a remortgage with the current lender.

2) The confusion seems to have occurred with the previous IFA.

If the above do not amount to the defenition of mis selling, even in the accidental sense, which I believe it was, then I apologise. However it has been confirmed that the confusion has occured as a direct result of the previous IFA 'getting it wrong'.

My question is - What losses can I reasonably ask them to reimburse? I hope there will be none or just those that can be easily quantified and agreed. I just don't know at the moment.

My other reason for posting this is as a general reminder to others to be very particular when checking Mortgage Offers. The only reason I spotted this is because I read through the offer very carefully and did not accept glib assurances from the well meaning receptionists at the intermediary's offices.

Thanks again for responding so quickly

dunstonh

Thanks for follow up info.

The responsible thing for the firm to do was find the closest match and pay the differences in any fees. They dont have to find the interest rate difference, if there is one.

Offer letters used to be signed in front of a solicitor but many dont do that nowadays. They are a very important document and you are quite correct in stating that people should look at them carefully.

HugoSP

dunstonh wrote: »

Thanks for follow up info.

The responsible thing for the firm to do was find the closest match and pay the differences in any fees. They dont have to find the interest rate difference, if there is one.

Offer letters used to be signed in front of a solicitor but many dont do that nowadays. They are a very important document and you are quite correct in stating that people should look at them carefully.

That's very interesting. Their initial move was to ask the lender to reoffer with the higher rate product that contained the incentives that I was originally promised with the lower rate. Their initial response thus falls into line with what you say.

My stance is that I want to be in the same position as if I had been fed the correct information. With the correct info I would have probably opted to stay with the current lender, so strictly speaking, should I only expect to bear costs that I would have done with staying with the current lender, and going with their 5 year fixed product?

Thanks again

dunstonh

This is similar to the mis-priced item in the shop. If an error has occured, then they do not have to honour the mis-price.

If your current lender could not be beaten, then using the current lender should still take place with the firm covering any fees on the discontinued application with the other lender.

I had a look though the FOS rulings and althouh there is no exact match, there are a few examples of errors where people have said they should honour the figures and the FOS have ruled against them and sided with the firm where the firm has been reasonable and the error was noticed early enough.

HugoSP

dunstonh wrote: »

This is similar to the mis-priced item in the shop. If an error has occured, then they do not have to honour the mis-price.

If your current lender could not be beaten, then using the current lender should still take place with the firm covering any fees on the discontinued application with the other lender.

That is the outcome that I'm hoping for.

Thanks

HugoSP

HugoSP wrote: »

That is the outcome that I'm hoping for.

Thanks

....and that is the outcome I think I'll get.

I'm a bit suspicious that I may have been offered 5.84% with the current lender at the time. The offer is currently 5.89% for the same term.

If there is a difference between the rates then and now I will seriously consider asking the IFA to bridge the gap.

HugoSP

Update, and further advice welcome please.

Good news - the rate that I have been offered does not appear to have been changed, so I have not 'lost out' on a cheaper deal that I could have had.

Bad news - the signed form needs to gat back to the lender by monday at the latest for the mortgage to kick in in time to avoid my paying the higher variable rate next month - costing me a further £80.

Question - If I do everything within my power to turn the form around as soon as I get it and it still misses the deadline, and I get charged the higher payment for May, can I reasonably ask my intermediary to refund the difference between what I would have to pay and what I should pay?

Thanks

dunstonh

You could ask. Can't do any harm. At this point, it is their choice whether they pay it or not.

HugoSP

Thanks

The offer duly arrived today. We signed it and returned it Special Delivery to arrive by Monday. I even took out insurance for consequencial loss should it be late.