First Direct fixed to tracker complaint

amnblog

So our OP has to prove the Bank strayed into the realms of advice. Then prove he was mis-advised?

michaels

So I think in 2001 OP took a product and at that time First direct had a 'promise' that theri svr would never exceed the base rate by more than 1%. IN 2006 he took a 10 year fix which he thinks the documentation did not say what variable rate would be payable at the end of the fix or if he chose to end the fix early. In 2009 he enquired how much it would cost to end the fix early which he was told and it was also 'implied' that given the then current FD product range coming off the fix was not in his interest. He did not enquire whether the original 1% over base cap rate was still available and this was not mentioned by the advisor.

By this reading of events the OP was in some way advised that staying with the fix was 'advisable' even though there was a product available to him as a result of his initial deal that might have made early repayment an attractive option.

If tapes were available suggesting this description of events would the OP have enough of a case to be worth putting in a cliam?

holly_hobby

amnblog wrote: »

So our OP has to prove the Bank strayed into the realms of advice. Then prove he was mis-advised?

Yes A, there will be an issue if the bank rep (s) strayed into providing advice or comment on anything regarding suitability of a product/when to exit etc, even if on an unintentional basis ie using statements such as "well what I'd do", "if it were me" "you'd be better off", etc... when not in a position to do so.

However, as I say what was actually said by the rep, to what the OP recalls/thinks was said or inferred at the time, are 2 different things.

Personally, I think he'll be flogging a dead horse in trying to prove advice that prejudiced him, and not basic info was provided re exiting etc. And that'll be the issue for our OP, if they truly believe they asked for and/or were provided with advice, which was neither permitted nor appropriate to their mortgage & financial circs.

Anyhoo, lets see what response the lender throws up when or if our OP decides to submit a complaint .... my money's on a big fat defend.

Holly x

holly_hobby

michaels wrote: »

........

By this reading of events the OP was in some way advised that staying with the fix was availalbe even though there was a product available to him as a result of his initial deal that might have made early repayment an attractive option.

If tapes were available suggesting this description of events would the OP have enough of a case to be worth putting in a cliam?

Yes, but a fixed product is more about certainty of payments and budgeting over a defined period, rather than the main benefit of it being the lowest rate available.

In fact if this WERE on an advice basis, there could well be an argument (having reivewed the OPs ATR and financial circs), to staying on the fixed rate, once you factor in the differential in rates, propsect of the variable rate achieving parity or even exceding the current fixed over the same period (and the OPs attitude and budgetary considerations to this), admin charges and ERCs ...

The issue here, would be to prove they were given advice/comment (authorised or not), having taken into account none of the above factors.

Still think they'll struggle though

Hope this helps

H x

michaels

More supposition - in 2009 OP asks 'If I come off my fix what products would be available to me' and receives reply 'Any of our current products which you qualify for under LTV and income' whereas infact they were also eligible for base plus 1% svr but were not told this option as the advisor did not realise. OP then decides to stay on fixed on this basis whereas OP might have made a different decison if offered the +1% tracker. No advice offered but an ommission by the employee - any chance of redress in this scenario?

holly_hobby

Good thought M. .... but sitting for the lender, I'd argue that SVR (if this is what the OP is referring to as a lifetime tracker), isn't essentially a product as such (ie a temporarly marketed incentive, of a defined rate and term), as it is the lenders basic and standard variable rate - which has no LTV or term restriction, so no I wouldn't expect a rep to quote their standard SVR, IF the caller asked for specific details of their current product range.

Now, if the lifetime tracker was indeed an actual product and not a follow on SVR, (much as they're marketing now), thats something else altogether.

See what the other bods think

Hope this helps

Holly

michaels

Of course in 2009 the FD svr 'for new customers' was 3.69% or similar, only those with the old 'our svr will never exceed the base rate plus 1% (kite mark) promise' might be eligible for that other 'svr' when coming off another product. As I say, I would have been aware of the 1% promise and specifically asked whether it would apply if terminating a fix early but if a more general question about available rates were asked....

famousfive_2

amnblog wrote: »

Presumably, once off of the fixed rate if the tracker increases the OP will complain about being exposed to rate rises.

That's a bit harsh and not at all where I'm coming from. I was happy to take the 10yr fixed at the time but was unhappy that when I queried mortgage and ERC advice in 2009 I wasn't given same information I was given this week as I would have taken ERC.
But like others said, I'm not 100% sure of the exact conversation in 2009 but i'll make the bank pull the tapes and listen back

I'll double check key facts to see if tracker mentioned when finished/ended early.
Anyway, its no drama, going to overpaying like mad now to get it cleared and we'll see what bank says.

Thanks to everyone else for their more constructive comments - I'll keep you updated.

famousfive_2

No other news from First Direct as yet, but I did get out documents of offer again tonight from 2006 fix and they state that after 10 yr period I would go onto SVR and no mention of the guaranteed tracker that I was eligible for. This was my understanding of the product and which was why didn't have any need to question rep advice in 2009. Feel Offer doc not clear on my options...but I'm sure you experts will put me straight on that

Thrugelmir

Did you still have the letter from 2001?