Northern rock loan over £25,000

downhiller

Just read the rest of this thread. We're waiting on a response from NRAM

kaybo69

Does anyone else agree that the hike in interest rate for delinking is totally unfair seeing as NRAM do not offer new products and therefore we have no choice to?
Could this help us?....page 8 is quite interesting
vvww.oft.gov.uk/shared_oft/business_leaflets/enterprise_act/oft854Rev.pdf

mammajen

Hi

Thank you for the reply.

Having checked our documentation - offer of loan it does indeed confirm regulation by the CCA. I therefore will be perusing this with NRAM.

I wondered if there was a standard template letter other members have used?

Thanks

gaz2180

Hi - been looking over my documentation this evening in order to put in a complaint. As already pointed out by mammajen above, our 'Offer Of Loan' section 12. Additional Features explains that an unsecured loan of up to £30,000.00 is also available with this mortgage. It states in the same section:

This additional feature is not regulated by the Financial Services Authority, but is regulated under the Consumer Credit Act 1974. You will receive a separate credit agreement with any offer document for this additional feature, describing the detailed terms on which this feature is available.

Quite explicit to me.

I have my credit agreement (on a nice shade of green) as mentioned already by many it's on headed paper - Credit Agreement Regulated by the Consumer Credit Act 1974 - and similarly within the signature box we only signed if we wanted to be bound by the terms of the CCA 1974.

Now what I hadn't noticed until tonight was our mortgage application paperwork. Section 6B (Loan Required) was specifically for the Together loan. It describes the loan in here as a loan facility that cannot be increased after the mortgage has legally completed. So we submitted a request for £30k and this is what is on our credit agreement.
However within this same section was another box to be completed for:

Initial unsecured loan amount (if any) to be sent to your solicitor upon completion of the mortgage

We've completed this for £25k and I still have the letter from our solicitors detailing an accompanying cheque for this amount when our mortgage completed.

We later released more funds - another £4.5k - but we never actually borrowed the full £30k in our agreement and our first withdrawal was for £25k.

I would first argue that even at the £30k, all our paperwork states that we would be regulated. But then I would argue that at first we only took advantage of £25k of our loan facility and therefore we should have been regulated from day 1 anyway. We haven't received anything at all from NRAM yet.

Has anybody else done this - got an agreement for a higher figure than they actually borrowed? One that particularly crosses the £25k 'threshold'?

mrsvanderkamp_2

gaz2180 wrote: »

Has anybody else done this - got an agreement for a higher figure than they actually borrowed? One that particularly crosses the £25k 'threshold'?

Hi

Yes, I believe that this is the position we are in. I say "believe" beacuse we took this mortgage in 2001 and I don't have any paperwork to confirm the original amount we drew down under the unsecured element. However, our agreement (Regulated under the CCA 1974 ) states a loan amount of £27,000 but I am fairly sure that we initially only asked for around £22,000 at the time of completion and then had a couple of further draw downs later on.

I haven't made any contact with NRAM over this yet, I wonder if I should or should I just wait and see how it pans out?

gaz2180

I'm unsure as well! Their website does say they are writing to everyone with loans over £25k - might wait and see what this includes before contacting them.

Hambrook1

Hi,

Just wanted to say thanks for everyone for all the blogs we really need to keep up the momentum here.

Something which I know was raised in very early quotes was 'should we be asking our solicitors why they didn't spot this error as it did form part of the mortgage deal and paperwork as the loans are linked to the house? It is there shared responsibiluty to check the leaglity of the paoerwork. The loans are unsecured until you stop paying them. If payment is missed to the loans they become secured. So my question is do we have a case against our solicitors for not checking our paperwork correctly? I seem to remember my solicitor talking to me about the loan quite a bit. Would a decent solicitor have kept a copy of our loan agreements?

mrsvanderkamp_2

Hambrook1 wrote: »

Hi,

Just wanted to say thanks for everyone for all the blogs we really need to keep up the momentum here.

Something which I know was raised in very early quotes was 'should we be asking our solicitors why they didn't spot this error as it did form part of the mortgage deal and paperwork as the loans are linked to the house? It is there shared responsibiluty to check the leaglity of the paoerwork. The loans are unsecured until you stop paying them. If payment is missed to the loans they become secured. So my question is do we have a case against our solicitors for not checking our paperwork correctly? I seem to remember my solicitor talking to me about the loan quite a bit. Would a decent solicitor have kept a copy of our loan agreements?

Hi I am actually a conveyancer and was a conveyancer when I originally took out my together mortgage.

Generally speaking your solicitor or conveyancer will only advise you as to the legal ramifications of not repaying your mortgage (ie repossession) and will usually advise you as to the basic terms of the offer (ie, amount to be borrowed, rate, term and repayment method) They WILL NOT generally advise you on the suitability of the product as this is the job of your IFA or Bank. Solicitors and Conveyancers are not qualified to give Independent Financial Advice and therefore anyone with a query over their product should refer it back to the bank or their IFA. The solicitor to be honest mainly acts for the lender to ensure that the loan is correctly secured against the property. Even if your solicitor thought that the loan was pricey or is some way risky, at the end of the day as I said, they are not qualified (and therefore legally not allowed) to give you financial advice. The best they could do would be suggest you think about it some more and take further financial advice.

Whether the whole "regulated or not regulated under the CCA" issue should have been picked up by a solicitor acting for you, I would say not. It appears that the legal beagles who specialise in this area of law can't decide which way the lead is swinging on the issue, so on that basis a solicitor specialising in property law would not be expected to have that kind of knowledge. So its not really a case of them not checking the paperwork correctly. And this issue is only arising because of NR's mistake. If they hadn't made it then I daresay we wouldn't be asking the question. Don't get me wrong I think there is blame to apportion here but I don't think solicitors in high street practice's dealing with property purchases are where it lies. I think there is a much bigger picture.

In so far as keeping paperwork goes, solicitors are required to keep files for 7 years (I have only been back in the game a few months after a 4 year break and this could have changed, but I beliveve 7 years was the minimum - files could be kept longer but due to the cost of storage etc it is unlikely that most firms would keep them any longer)

mrsvanderkamp_2

gaz2180 wrote: »

I'm unsure as well! Their website does say they are writing to everyone with loans over £25k - might wait and see what this includes before contacting them.

Where did you see that they were writing to customers with loans OVER £25K? I thought it was only loans under £25K at the moment? Or have I missed an update (have looked on their website though and I can't see anything) Thanks

gaz2180

mrsvanderkamp wrote: »

Where did you see that they were writing to customers with loans OVER £25K? I thought it was only loans under £25K at the moment? Or have I missed an update (have looked on their website though and I can't see anything) Thanks

It's under the 'What if the statements I've been sent show that my loan is regulated by the CCA' FAQ on the website.

I certainly have received these statements so am assuming they will be writing to me.