FCA: Bank tracker changes "unlawful".....

chucknorris

Thrugelmir wrote: »

WBBS have singled out BTL LL's with 3 or more properties. Very clever, as won't attract public support. Despite all the media coverage being generated. Many landlords say that they cannot afford the increase. Which is laughable.

I agree, but what has that to do with my comment to Brit?

Loughton_Monkey

chucknorris wrote: »

Hey what's that on your shoulder Brit? Looks like an extremely large chip to me.

Surely not. How can you have a chip on your shoulder about something you have elected to do? If my memory serves, our Brit is on "FTB strike" so chooses to be a lifelong renter.

A glance at his current strapline "Scams: Shared Equity, Shared Ownership, Newbuy, Firstbuy and Help to Buy." is rather worrying though.

Personally, I'd never admit to being involved in such scams but it takes all sorts.

Take my advice, Brit, and get into BTL. That's the best scam you can be into. You can charge high rents even when the mortgage rate goes down.

..... large gin & tonics all round...:rotfl:

[Sun well and truly over the yardarm, so I'm going for mine now.]

grizzly1911

Loughton_Monkey wrote: »

This thread got me running to my own mortgage terms [Offset IO mortgage with First Direct]. I must admit to a modicum of ambiguity:

Firstly, on the front page of the contract [the only page which is unique to the cutomer] we have this:



So far, that's pretty clear, for a mortgage converted to Offset on 3/10/2003. But when we get to the attached printed terms & conditions, under "Interest and Account Combination" we get this:



I can take this either as simply highlighting the 'variability' already mentioned in the first part, but I wonder if they mean they could vary the contract with regards to the 1% above Base Rate guarantee?

But finally we get the 'Killer' in the very last printed paragraph 16, headed Variation of Terms.



I take this as Carte Blanche (legally) simply to write to me with, say, 3 months notice, announcing that they have decided to charge 3% over Base Rate. I feel, however, that FOB or FCA would rule this as out of court, although in extreme financial turmoil, who knows?

It's a bit like saying "If you give me £100,000 for an annuity, I promise to pay you £3,500 per annum for the rest of your life. Unless, of course, I choose to vary that amount at which point I will write and tell you that I have decided to pay you only £2,000......"

Is it really comparable to an annuity? An annuity is fixed on both sides.

In the mortgage situation, the borrower could also choose to alter the arrangement or terminate it should their position change.

HAMISH_MCTAVISH

Thrugelmir wrote: »

any borrowers wishing to take High Court class action to contest the fairness will require very deep pockets. The costs will run into hundreds of thousands.

It appears, however, that they will not need to as the FCA is already acting and has fired a warning shot across the bows of lenders.

HAMISH_MCTAVISH

Loughton_Monkey wrote: »

It's a bit like saying "If you give me £100,000 for an annuity, I promise to pay you £3,500 per annum for the rest of your life. Unless, of course, I choose to vary that amount at which point I will write and tell you that I have decided to pay you only £2,000......"

Exactly.

I rather suspect many forms of financial services providers have some form of 'exceptional circumstance' clause in place.

They would rightly be hammered by TPTB if they ever chose to try and use it just because rates rose or fell beyond what they had predicted however.

brit1234

HAMISH_MCTAVISH wrote: »

It appears, however, that they will not need to as the FCA is already acting and has fired a warning shot across the bows of lenders.

Why WB are the 3rd lender to do this and are legally sound. There is nothing to stop other lenders from doing this. As I said earlier the class action are realizing this and turning their lawsuit to individual solicitors which won't affect banks even if they win.

HAMISH_MCTAVISH

brit1234 wrote: »

There is nothing to stop other lenders from doing this. .

I'll repost the key parts, as obviously you missed them the first time.

'The City watchdog has written to banks and building societies warning that changing customers' mortgage terms could breach consumer protection laws.

The FCA's letter, sent today, revealed that a number of mortgage lenders have contacted the regulator about changing their mortgage contracts, including standard variable rates, according to The Times.

The letter, from Clive Adamson, the director of supervision at the FCA, warned such changes could breach consumer law and the regulator's principles for business'.

Thrugelmir

brit1234 wrote: »

Why WB are the 3rd lender to do this and are legally sound. There is nothing to stop other lenders from doing this.

Lenders will need to justify their actions. Skipton changed SVR's across the board. WB will need to explain why they targeted a certain group only 6000 -7,000.

brit1234

Justin Selig - You should note that if we do not proceed, you will get a pro-rata refund of your money paid to us, after deduction of our costs and expenses. The more people that join, the greater that refund will be.

Now talking about refunds of fund money if the QC says they haven't got a case.

http://www.property118.com/west-bromwich-building-society-mortgage-company-increase-tracker-margins-legal-action/43657/comment-page-168/#comments

armour

A mortgage sold as a base rate tracker should track the base rate. Anything else is mis-selling.
If that sends West Brom or BoI over the edge, too bad.