House Deposit - Section 75a Claim

milktwosugars

Dear All,

I'm new to the forum so please bare with me! I hope to seek advice on a Section 75(a) refund for a lost house deposit.

Armed with a Buy To Let mortgage promise from the Halifax - who I have banked and had a mortgage with since 1997, I successfully acquired a property at auction for the value of £52,000. As per the auction rules I had to pay an immediate 10% deposit (£5,200) plus auctioneers fee (£700 plus VAT). Both amounts were paid using an MBNA credit card.

Prior to the auction I had already appointed a solicitor and advised my mortgage advisor at the Halifax of the timescales involved for completion. After the auction I contacted the Halifax but was advised my mortgage advisor had changed branch and I would now need to liaise with a new member of staff.

I met with the new mortgage advisor at the next available appointment. However despite my valid mortgage promise things began to unravel and I was advised some of the advice previously given by the former advisor was incorrect in terms of both the deposit finance (releasing equity on my existing property) and obtaining the Buy To Let mortgage. There were also issues related to my current and previous addresses which were not brought up in the original meeting.

The end result was Halifax declined my mortgage application and with only 21 days to complete I was forced to search the market for a new lender. Regretfully the auction property is located adjacent a Fish & Chip shop and Halifax were one of the few lenders who would consider extending a mortgage on a property of this criteria.

Further time was wasted applying with Nat West - who approved my application but refused the property upon valuation. Unfortunately the Nat West property criteria on the mortgage broker portal was incorrect. It stated only properties above a commercial premises were unsuitable. My independent advisor had queried this and was assured a property adjacent a commercial premises would be fine.

During this time the vendor had been extremely patient and the original completion dated had surpassed and another date set. Regretfully after searching the market relentlessly to find a lender who would mortgage the property to no avail, I was served with a notice to complete. The notice expired yesterday and I have been informed the vendor has retained the £5,200 deposit paid on my MBNA card.

I am aware Section 75a of the CCA has raised the threshold of claims to just over £60,000. However I am aware it does not extend to land purchase. Is there a differentiation between land and property and if so do I have grounds for a claim? My own opinion is I don't, as the vendor has done nothing wrong, it is purely the intermediary which has created the issue that has lead to me losing my deposit.

Any advice offered would be greatly welcome.

Thank you!

eskbanker

If you paid the vendor by CC and by your own admission the vendor did nothing wrong then it does sound like you have no grounds for a s75 claim. However, if your case is that you've suffered losses as a direct result of poor advice by Halifax then you should pursue a claim against them, initially via their complaints process, then FOS if required and ultimately small claims service.

Fruit_and_Nut_Case

milktwosugars wrote: »

I'm new to the forum so please bare with me!

Welcome :wave: What is it these days that everyone wants to get naked?

Hope you get a satisfactory outcome to your problem

grumbler

milktwosugars wrote: »

...Armed with a Buy To Let mortgage promise from the Halifax...

Am I wrong thinking that the 'promise' has to be in a form of a formal document (Mortgage Offer?). If you have the document and have not deceived Halifax when applying, I think it's very easy to claim all losses you suffered as a result of their mortgage adviser alleged incompetence.

jonesMUFCforever

S75 only covers from £100 to £30000.
It does not matter that you paid less than this on the card.


You have no claim whatsoever through the card.

chanz4

sure it wasn't a AIP

Thrugelmir

milktwosugars wrote: »

Armed with a Buy To Let mortgage promise from the Halifax

That's not a mortgage offer. It will be subject to............

Thrugelmir

milktwosugars wrote: »

it is purely the intermediary which has created the issue that has lead to me losing my deposit.

The transaction was always at your risk. Obtaining a mortgage after committing to purchase at auction left you exposed.

surrey_jim

I would check the T&C of MBNA. I know Amex T&C advise that their cards cannot be used for the purchase of property. I assume is it because the CC companies do not inspect the property before lending the money for it.

shortcrust

From the Halifax site:

A promise is a promise. However, sometimes we may not be able to lend you as much as we first promised if:

• any of the details you give us change
• anything about you has changed at the credit reference agency when we make a full loan application search at the time you apply; or
• following our discussion with you about your needs and circumstances, we find that we do not have a suitable mortgage for you.

In other words, a mortgage promise is pretty meaningless. Seems to me that the OP took a big gamble and lost.

Voyager2002

The credit card aspect is irrelevant... as a result of bidding at the auction, you have a contractual liability. Even if you were able to persuade the credit card to charge back the money (unlikely) the vendor could insist that you pay the deposit and fees using a different means, and enforce this through the courts.