Processing fee not refunded after agreed in principle then declined

AshHoll

Hi,

Does anyone have any advice on this issue:
A lender wont refund the processing fee for an application after it was agreed in principle and then declined based on our accounts not being good enough for them to lend us the amount we need.

In detail:
Found a mortgage with Accord mortgages using a broker (fee only on completion so haven't lost any money there).
Received agreement in principle. I'm full-time employed but my wife is self-employed so on her part we had to provide a fair amount of info to get it confirmed (several months bank statements, 2 years accounts etc. all pretty standard I'm sure). We paid £365 in arrangement fees which we were informed by broker would be refunded if the application didn't go through.

We then moved on to the full application - all handled by the broker. Accord kept asking for more info on both of our accounts. I had to provide more pay slips from previous months and my wife had to provide further months bank statements, accountant certificate and so on. We checked that the AIP was confirmed (as it seemed odd to be asking for more accounts info if we already had it) and were told it was this was just for the full application.

We found out this week that they're not willing to lend to us based on my wife's accounts not being good enough.
We asked for our fees to be refunded and have received £265 and been told that the remaining £130 can't be refunded because it was used to process the full application.

On their website they say: "If a product withdrawal has not been announced, you must always await the outcome of a lending decision prior to submitting a Full Mortgage Application. If you do not await the outcome and subsequently receive a decline, the Mortgage Application Processing fee will not be refunded."

So there are two questions really.
Firstly can they really give an agreement in principle take money to process the full app and then decline based on stuff that surely should have been looked at (and was) in the AIP stage?
I've heard of full apps being declined based on stuff that's come up in the credit score or something but this was purely down to accounts. Nothing about our credit score was mentioned as a determining factor (as far as I know there's nothing negative on there, no defaults etc.).

Secondly, should our broker really have waited after the AIP before going to full app if there was a chance we'd lose money?

Sorry this is such a long post but wanted to get all info in.

AshHoll

Update: Mortgage broker has very kindly offered to refund the money themselves.

betmunch

You mortgage broker should not have told you the fees would be refunded as they are non-refundable.


However, he has made good on his mistake at his own expense.


I expect he wont be making that mistake again.

Thrugelmir

AshHoll wrote: »

Update: Mortgage broker has very kindly offered to refund the money themselves.

Was their error originally.

which we were informed by broker would be refunded if the application didn't go through

Really no alternative but to do so.

ethank

An AIP is just a cursory glance at information.

Following a full application, they look at everything in detail and can easily refuse if they want to.

I think you have been lucky to get your money back here, but doubt that you will be this lucky again.

ACG

Accord are a nightmare, on of the reasons I never touch them as you could provide the world and it would not be enough.

Broker has corrected his mistake though, so you cant ask more than that.