Intelligent Finance - Changes to Mortgage Deal

jonte7

I received a letter yesterday explaining that Intelligent Finance have made a decision 'to stop accepting applications for further advances or changes to your mortgage deal'. Some questions:

1) Are they technically allowed to do this, is it not counter to the agreed T&Cs of the product? For me, this was part of the reason I purchased the product, for the increased flexibility.

2) I've spoken directly with the company and they have recorded my concern, and suggest I follow up with their parent company Lloyds. Is this the right route? What are my best next steps?

3) Are others concerned about this change?

hillcats

We've not had this letter yet...
Although to be fair, we weren't bothered when they stopped the facility called "pre-agreed reserve" many years ago. Although it was nice to know it was there, we have never intended to increase our borrowing / move home - the aim has always been to pay off the mortgage and enjoy life even more...
To answer your question - No, we're not bothered about this change at all.

ethank

Not surprised. IF are running themselves down, and all this actions are probably designed to get you to move to another provider.

adscas

Thanks for the message Jonte7. I too received the letter and would like to challenge IF. I've sent you a message with my contact details - perhaps anyone else who reads this post and who would like to connect might want to message us to combine our resources and knowledge.

I have spoken to IF and their decision means that I am now unable to move house (which I'd like to do in 2014) and take the great deal of 0.34% above BOE base with me. Seems hugely unfair given that this was one of the key facts on which the deal was sold to me back in 2007.

Cheers, Andrew

Thrugelmir

Not sure what you expect to challenge. IF is no longer writing new business. Then your only choice is stick with your existing mortgage or remortgage elsewhere.

The financial world has changed since 2007. Make the most of the low rate you have.

ethank

adscas - unfortunately you have no right to a mortgage, they lent you money on their terms, and if they lent you further money it would be on their terms.

Even if they were considering further advances they could have said no to porting your loan to another property.

adscas

ethank - I don't want to borrow more money, merely port the existing debt to a new property.

I've since had a reply from IF to my internal complaint which seems to suggest this will be possible after next April. Specifically it says "After 11th April 2014 you may still be able to port your mortgage, however, you would not be able to borrow more money" Whilst not ideal, this solves 90% of my problem.

hillcats

This may still be an issue as if you need to borrow more additional funds to get the new property then an issue will appear when both lenders want first charge over the property... Just a thought !

ethank

adscas, if you need to borrow more money to move then unless you can find the remainder without resorting to further lending, then you will not be able to move.

Also, they said may. Many lenders turn down porting for many different reasons. The criteria is probably a lot tougher since you took out your mortgage and they could say no.

holly_hobby

I wouldn't put much stock on their reply, given "Porting" actually relates to the transferring of a mortgage product (fixed, discount, etc) to an equal amount of borrowings on a new mortgage, but essentially not the underlying borrowings (ie outstanding mortgage account), as debt can't be transferred between properties.

This is because when you sell your home the solicitor will repay the outstanding mortgage to your mortgage lender, which allows them to remove their charge, and permits your purchaser to purchase with free title (and their own lender register 1st charge).

This means that the mortgage secured on your new home, even if with the same lender and you are porting your mortgage product, is entirely classed as new borrowing, under a new mortgage account ... which is why given that IF have closed to new business, I wouldn't rely entirely upon what they have inferred re being able to port your product.

With regards to legal action etc, there really is no mileage in this, given that IF have chosen to withdraw from the mortgage market and close to new business, that is essentially their right ... I know that doesn't help you at all, but its important to be objective.

Sorry this wasn't more positive for you, but hope it helps explain the process.

Holly x

mojo1997

we received the same letter prior to Christmas, but we are currently on their standard variable rate of 2.5%. I'm worried that it looks to me that in order to encourage existing mortgage customers to move on to another lender they will start putting their rates up after April.

I've called them to discuss this but the person I spoke to wasn't very helpful.

I may call them back and inquire about going onto a fixed rate or another product prior to April.