HELP...Have my parents MTG been mis-sold

somethingcorporate

BECSTAR07 wrote: »

I think your missing my point! Maybe you would be better sitting in an audience FOR JEREMY KYLE instead of joining into conversations and offering so little........my advice to you :-)

My advice to you is to accept your parents are adults and have to take some responsibility for their actions - the bank didn't make them live beyond their means for many, many years.

Thrugelmir

BECSTAR07 wrote: »

they have never had extravagant holidays or posh cars they do not smoke gamble or drink, they simply have had more outgoings than incoming....... Over the years for many reasons my parents have fallen deeply into this reserve

Then the simple fact was that they were living beyond their means. Now they are paying for the consequences of such a lifestyle. There's absolutely nothing to complain about. I guess you are upset that your parents spent what you thought was your inheritance. That's life.

nidO

BECSTAR07 wrote: »

and thanks for the post but when people are in debt they are forced to borrow.....hence why people turn to pay day lenders etc.... They have been challenged for their irresponsible lending...

So which is it?

Either your parents didn't really need to borrow this money = irresponsible borrowing
or
They did really need to borrow the money which means still irresponsible borrowing over the long term as their lifestyle should be adjusted to match their means, but also if they couldn't borrow it from their mortgage offset they would have had to borrow it somewhere else, at a higher interest rate and requiring repayment more quickly, making the situation even worse for themselves?

I'm also not sure where you've got these "financial reviews" from - I've had plenty of credit cards and the odd small loan over the years and have never once had a "financial review" for them, other than the ones I do myself by knowing what money I have coming in and going out.
You work at a bank, you should know this - The "financial reviews" you/your colleagues provide to people are nothing of the sort, they're sales pitches.

sinizterguy

nidO wrote: »

So which is it?

It isn't the OPs parents' fault. Honestly.

The lender just sent them the money and told them they have won the lottery.

theEnd

How much is the house worth?

It's really no different to extending the mortgage or remortgaging, which is what lots of people do. What they spend it on is their business. The bank only needs to be sure the total debt is less than the house values it's secured on.

Perfectly normal.

dunstonh

I feel has been completely mis-sold to my parents.

Nothing you say suggest any mis-selling. it is commercial decision on how much money should or can be lent. There was nothing in the rule book at that time that restricted the amount.

Approx 20 years ago they took out a Woolwich offset reserve mortgage

Just to note that mortgages did not become regulated until October 2004. So, this is way before that.

this meant that running alongside there current account was a HUGE overdraft/reserve of £117,000 which was there for them to use as the wish, home improvements holidays etc. As they repay their mortgage this reserve pot comes down, currently their limit is 90k.

That is correct and how the product works. Nothing wrong with any of that.

My issues are HOW CAN THIS BE ALLOWED WITHOUT ANY BUDGET REVIEW TO CHECK THAT MY DAD WHO WAS CLEARLY BURRYING HIS HEAD IN THE SAND CAN AFFORD TO REPAY THIS.

Your dad was welcome to seek advice from the bank, an independent financial adviser or the citizens advice bureau. As adults your parents are able to make decisions and act responsibly. You cant force someone to though.

Surely this is irresponsible lending by Woolwich/Barclays.

Its pre-mortgage regulation and pre the more recent regulations that look at affordability. However, just because you have a facility does not mean you should use it. My car can go 150 MPH. So, does that mean I should drive it that fast?

Surely like with the Interest free mortgages the lenders must have proof that a vehicle repayment plan is in place to repay this reserve off?

There was never a requirement for lenders to have proof a repayment vehicle was in place. They used to check for their own benefit but that stopped around the mid 90s. More recently, lenders have encouraged people to check their repayment vehicles and written to ask what it is in some cases. Typically on the annual statement, there are big warnings about this.

I AM LOOKING FOR SOME ADVICE AS TO WHETHER THEY MAY HAVE GROUNDS TO COMPLAIN FOR BEING IRRESPONSIBLY ALLOWED FOR OVER 20 YEARS TO FALL MORE IN DEBT WITHOUT BEING CALLED IN FOR A FINANCIAL REVIEW

Pre-regulation, got the product they applied for. They spent the money through by their own choice. No requirement for ongoing reviews and never sought them. Nothing suggesting any wrongdoing by the lender.

amnblog

Becstar is disturbed and appalled at the situation her parents find themselves in.


It is simply a human reaction to look for someone or something to blame.


Ironically, I suspect all the family have benefitted from Barclay's money in some way over the past 20 years.

inkiboo

A great summary of everything that is wrong with many people today; it's never their fault, it is always someone else to blame.

Your parents were not mis-sold; they were however misguided and only have themselves to blame.

ratrace

Cor the banks cant win, they get shot when they don't lend and then get shot again when they do lend.....


Sorry but its poor management of money that has caused the amount of debt really sorry to sound harsh but from your post it seems like its everyone's fault but your parents

edinburgher

This discussion aside, I hope you're doing what you can to encourage your parents to try and recover the situation as best they can.

Some serious budgeting and a reset of their expectations would seem to be in order.

It's not a fun stage in life to have to do this, but they're far from alone. I have worked with a couple of people who have ended up in the situation of spending more than they earned for a prolonged period. One of them turned it around thanks to a healthy pension lump sum, the other will be lucky if he's not homeless by the time he hits 60.