Help with bad advice from a broker

MoggyW

Hello

I'm sorry if this is a bit complicated but please bear with me!

Basically I have a flat I rent out on a residential mortgage with consent to let, but this was due to expire so I wanted to remortgage to buy to let. I got the advice of an online broker who took all the details and circumstances, then told me a particular provider would be right for me. He told me he had the agreement in principle, and I parted with£150 arrangement fee and £175 fee for valuation of my flat for the old mortgage company. A solicitor was also instructed. Weeks went past and he was very difficult to get hold of, he often "sent" emails I never received, and then After a delay of a couple of weeks I rang him to be told I had been turned down some time ago, and I again hadn't received the email.

It transpired I had been turned down because when the mortgage company contacted me to go over the fact find, I had (truthfully) told them the extra equity I was raising was for a vehicle. He informed me I supposed to have told them it was for onwards purchase of another vehicle, which was what he had told them when he got the agreement in principle, however he never told me this. This was apparently In another email I had never received, but I am doubtful of him actually telling me to lie in an email.

Because of the delay in him telling me, and the fact my credit score was damaged because of the previous searches done by the prospective mortgage company, I was not able to get a new mortgage in time as I am now self employed and no one can help until I have books. Therefore, my flat is now on the market because he didn't tell the truth to the mortgage company.

I spoke with the MD of the brokerage today, who surprised me by immediately saying he would pay the costs incurred so far, but if I were "make the complaint official" he would pay nothing and "our dealings were done." He was initially very apologetic and left me no doubt that the company has done wrong.

So... should I be thinking about some kind of compensation claim for the bad advice - I can't prove he lied but at the very least he has given me terrible, wrong advice. If so, how would one go about such a claim? Or, should I take the £300 I have spent and chalk it up to experience?

If you got this far, thanks for reading!

Thrugelmir

Accept the refund of your costs and move on.

davidmcn

Thrugelmir wrote: »

Accept the refund of your costs and move on.

Seconded...

dunstonh

I spoke with the MD of the brokerage today, who surprised me by immediately saying he would pay the costs incurred so far, but if I were "make the complaint official" he would pay nothing and "our dealings were done." He was initially very apologetic and left me no doubt that the company has done wrong.

This is not uncommon. If you make it official, it immediately incurs costs for the firm. So, its often cheaper to offer a settlement rather than go down the official route. Even when there is no wrongdoing.

So... should I be thinking about some kind of compensation claim for the bad advice - I can't prove he lied but at the very least he has given me terrible, wrong advice. If so, how would one go about such a claim? Or, should I take the £300 I have spent and chalk it up to experience?

We regularly warn people of the risks of using online brokers. Fine for the easy stuff but best avoided for more complicated issues.

However, the fact you are now self employed and cant get a mortgage now is not their fault. A complaint would take time and you could end up with nothing. If it is successful then a refund of charge plus £100-£250 is likely. So, it depends on whether you feel its better to take £300 to risk £0 to £550.

ACG

The lender presumably has the proof that the information for the extra money was incorrect?

I would say take the money and move on. But I would probably make it clear that its because its easier for you rather than his threat as to the reason you are doing that.

chappers

Have you spoken to your existing lender and explained the situation to see if they may extend the consent to let.

amnblog

chappers wrote: »

Have you spoken to your existing lender and explained the situation to see if they may extend the consent to let.

The request to raise extra funds precludes this.

amnblog

This is not regulated business so you do not recourse to the FCA, so unless you are prepared to take this firm through the Courts (assuming you have a case), you should take what has been offered.

MoggyW

Wow thanks all for your opinions and experience!

I have also sought advice and have been advised I would most likely have a claim because there is actually paperwork showing the broker lied without discussing with me in the initial application, however as you say it will be a lengthy and arduous process I am probably not prepared to go through.

I understand it is not their fault I am now self employed and can't get another mortgage, but do we not make our decisions based on the advice of someone we are paying for, who has apparently studied and is apparently knowledgable on the subject? And most of all, are supposed to be honest in their work. It just makes you totally lose faith.

amnblog

So you told the broker during the application process you were going to leave your employment?

MoggyW

Well I was never anything but honest with the broker- it was a massive debate as to whether or not to leave my full time employment - I was initially thinking of doing my new self employed role part time in addition to my current to save for a second investment property, but the formal offer of the new mortgage made a huge difference to my decision.

I guess I've learned my lesson not to necessarily believe the advice of professionals!