Mortgage Application Booking Fee Racket

MondoDeDovecot

My partner recently applied for a mortgage with 1st Direct - she was advised in the first phone call that to guarantee the rate she would have to pay the Booking Fee of £500. The Mortgage seemed perfect so she paid the fee scared of losing the rate but she wasn't asked any questions or had any details explained. The documentation that she then received was for an offset mortgage although she had asked for a specific remortgage repayment mortgage - which confused her - when she rang 1st Direct and they only then started to ask questions - never apologising for sending the wrong mortgage details - when she was asked whether she would be renting it out she said she had no plans but after asking her boss she found that her job might force her to relocate at some point for up to a year. When she asked 1st Direct about this she was then informed that she would not be able to change her mortgage over to a buy to let and would have to incur an early repayment charge of many thousands. As this was a real possibility this mortgage was worse than useless to her so she pulled out and asked for her booking fee back - she was refused even after complaints were made. This is a disgrace - what a racket - does anyone even know how much these companies make out of goading people in to mortgages with such a large fee that don't suit without giving advice ?(as well as taking the money on the initial phone call and never receiving a receipt!).I put this on this forum as I read 1st Direct comes top on this site for customer service and it was me that informed my partner of this making me feel awful now.

Thrugelmir

When you apply you the assumption is that you have already asked the questions. Afterwards is rather too late. Not how the system works.

dj1471

Under the new mortgage rules lenders are required to give advice and assess affordability if you speak to an adviser. It doesn't sound like that happened here, unless the advice was refused. Have a look at the Financial Conduct Authority website for details.

In the first instance I'd suggest your partner complain to First Direct that the wrong mortgage was "booked". Most companies record all their calls so suggest that they go back and review it. If that doesn't work complain to the Financial Conduct Authority.