Yorkshire BS missold Tracker with collar- advice needed

Klfale

Hi, I'm a newbie here so please bear with.
Ok, I took out a fixed rate mortgage with YBS back in 2005 which then reverted to BOE tracker plus 0.75- sound great? Well this is what I thought until I found out that I had a collar/floor/cap on this rate so it would never drop below 3.75.
I would like to claim that I was missold this product and lead to believe it was a real BOE tracker as it mentioned in the KFI doc. I have now pulled out my paperwork and it does indeed mention the collar but it is not mentioned in the same box as the rate, so would like to claim that this is unfair and was not given prominence and was not clearly disclosed.
Does anyone have any tips or guidance on how to proceed further with this. I have already sent a letter to YBS complaining but I'm sure they will find a way out of it..
Thanks

YorkshireBoy

I have the same/similar product as you (offset BOE + 0.75%, collared at 3.75%), taken out the following year as an existing customer product switch.


When the BOE rate fell dramatically a couple of years later I too expected my rate to tumble (I'd planned to take out my savings, because I was 100% offset, and save them elsewhere to make a small profit). When it didn't, I looked at my T&Cs/KFI and found the relevant clause.


Because I'd accepted the terms I just moved on!


Suggest you do the same because I doubt you'll get anywhere with your complaint.

Klfale

Have you seen this from the FSA:
"Jon Pain, the FSA's then director of retail markets, said in 2008: "While tracker interest rate floors can be a legitimate term of a mortgage, it can only be if it is clear and unambiguous to the consumer and is consistently and prominently spelt out in the initial key facts document and offer document throughout the sales process."

Surely YBS would need to take notice

YorkshireBoy

Klfale wrote: »

Have you seen this from the FSA:
"Jon Pain, the FSA's then director of retail markets, said in 2008: "While tracker interest rate floors can be a legitimate term of a mortgage, it can only be if it is clear and unambiguous to the consumer and is consistently and prominently spelt out in the initial key facts document and offer document throughout the sales process."

Surely YBS would need to take notice

When I pulled my T&Cs/KFI to check, I thought it was indeed "clear and unambiguous".

Yes I swore to myself (well at them actually!), but it was very clear*. And who'd have thought in 2006 (let alone in 2005) that 3-4 years later we'd have a 0.5% BOE rate...and that we'd still have it some 5 years later (with the possible exception of YBS's hedging team of course!)?

Of course, since I took mine out in late 2006 (12-18 months after you?) they may have modified the documents in the interim?

Klfale

I think they have changed the kfi and the marketing on the website so it is clear, so this shows they thought it was unclear.

societys_child

Klfale wrote: »

I have now pulled out my paperwork and it does indeed mention the collar

Not sure how you can claim a miss-sell in that case.

I think they have changed the kfi and the marketing on the website so it is clear, so this shows they thought it was unclear.

Websites are updated regularly, doesn't necessarily mean they thought that.

Klfale

Thanks Societys child
This collar should of been contained within the rate itself, forexample: Fixed 4.99 till 2010, thereafter tracker of BOE plus 0.75(collar/floor of 3%). The FSA regs on KFI state that all of the above should betogether and not a one liner stated in a separate box. As a customer you donttend to look at those parts and concentrate on the rate itself.

Also, as per the posts above, the FSA state that collars need to be "consistently and prominently spelt out in the initial key facts document and offer document throughout the sales process"

magpiecottage

Without seeing the Key Facts document and mortgage offer, we cannot be certain.

However, generally these have followed a specific standard ever since the FSA started regulating mortgages just over nine years ago.

So, unless you can prove that it was incorrectly described, you have no grounds for complaint.

As the document (or at least the data which is used to populate it) is produced by the lender, not any broker you may have used, your complaint should be against the lender, in accordance with the Law in Shanklin Pier v Detel.

roonaldo

I agree with magpiecottage, the documents issued to you are standard since they become regulated, also you have already said it says on the KFI that its a collar. so not sure you got a valid complaint.

dunstonh

The point of a cap and collar is that your rate will always be somewhere in that band. A cap and collar can track the boe rate. It can be an SVR or whatever. However, it has a min/max within that.

If the KFI says that then its hard to see how you can be mis-sold. Probably frustrating for you that with hindsight you may have preferred a mortgage without a collar. However, a lot of people would have liked hindsight in picking their mortgages back in the early to mid 2000s.

roonaldo

if interest rates were 6% you would not be posting.

in hindsight i would of picked the correct lottery numbers last week.