Bank Moving Goalposts During Mortgage Application

CityTiger

We are currently going through a very long and frankly disorganised mortgage application process with First Direct.

There are several reasons for us to be unhappy with the whole process and speed but by far the biggest one is that we had booked a 5 year fixed rate at 2.19% when we first applied - paying £1.5k for the privilege.

Unfortunately, when we had a survey done on the property we went for, there were too many things that concerned us. So, we pulled out and went for a different property.

The second property cost a fair bit more than the first so we needed to change the amount we needed to borrow (although we kept the same LTV).

When speaking to First Direct they assured me they would honour the 2.19% rate I had booked. In fact it got as far as them confirming it had been approved by the underwiters and they had instructed the surveyors are were issuing the offer.

However, a week or so after this I got a call saying they had made a mistake and they can only honour the 2.19% rate on the amount I originally asked to borrow and the extra amount would have to be taken at their current rate (which I think is now 2.78%).

Now, this would be fine if they had told me this at the start, but they didn't. We specifically asked and were told we could keep the rate and there was no mention of having to pay a different rate on the amount extra we were borrowing.

As a result we made the decision to proceed with the purchase based on the repayments at 2.19%. We are now facing paying a higher amount for the next 5 years than we intended but have already spent money on solicitors and surveys so even if we didn't want to accept this higher level we would still lose money on something that was not our mistake.

We are intending on writing a complaint to both First Direct and the ombudsman. Do you think this complaint is justified?

Funny_old_game

You couild complain, thast is your right.

But be 100% that at no stage over the phone they said 2.19% was only for home A.

Subsequent calls confirming you could use it for home B may have been incorrect, but people do make mistaskes.

The important bit is if you were told first on a recorded phone line you bought that product on that application.

I'd be surprised they couldn't let you hasve it on home B unless the drawdown date of 2.19& had expired as you had a sale fall through. Look at ther illustration for the 2.19%, it will tell you how long the prodfuctnis valid.

If you took too long finding another home you need to suck it up.

Product shelf lives can be anywhere from 3-9 months.

CityTiger

We had the 2.19% booked until the 13th September as it was booked for 6 months - that's why they will still let us have the 2.19% on the original amount we borrowed.

They are saying the 2.19% was booked against a certain amount of money not a specific property which is why we have to pay a higher rate on borrowing over this initial amount.

Again, that may all be true and correct - it's the point that we made our decision based on information they gave us which they are now saying is incorrect. It also astounds me it has taken this long for them to spot the mistake given we were given the incorrect information almost 2 weeks ago.

Thrugelmir

CityTiger wrote: »

In fact it got as far as them confirming it had been approved by the underwiters and they had instructed the surveyors are were issuing the offer.

There would be no formal offer issued until the entire underwriting process was complete.

When you say the application was long. What timespan are we talking about. As what was said may have been relevant at the time but time passes and things move on

kingstreet

It would be normal for the funds allocated to a product which is very attractive to be exhausted quite quickly.

As a result, someone with an allocation of such funds coming back for more would be offered the top-up on whatever rate the lender is offering at that time.

In your case the lender did not explain this at all well and the FOS outcome is likely to be £200 and a bunch of flowers, or thereabouts.

csgohan4

is the product for a certain LTV? when you found another expensive house perhaps that bumped you up a LTV

Lemonsqueezer78

csgohan4 wrote: »

is the product for a certain LTV? when you found another expensive house perhaps that bumped you up a LTV

The OP mentions that they kept the same LTV.

Lemonsqueezer78

If you feel a complaint is justified - then make your complaint.

In m experience, canvassing opinion on here about these kinds of matters generally elicits, at best, a range of opinions on whether a complaint is justified or not - which will not actually provide any actual help to you - and at worst, a long queue of people telling you how pointless a complaint will probably be because of technicality "abc" or legislation "xyz" - or just because it is oddly common on these boards to default to assuming the blame lays with the consumer when matters like this arise.

The truth of the matter is, other than time, you having nothing much to lose in making a complaint. If nothing else they may accept responsibility for some "miscommunication" somewhere and offer you a gesture of goodwill. Or they won't...and life will go on.

TrickyTree83

CityTiger wrote: »

We had the 2.19% booked until the 13th September as it was booked for 6 months - that's why they will still let us have the 2.19% on the original amount we borrowed.

They are saying the 2.19% was booked against a certain amount of money not a specific property which is why we have to pay a higher rate on borrowing over this initial amount.

Again, that may all be true and correct - it's the point that we made our decision based on information they gave us which they are now saying is incorrect. It also astounds me it has taken this long for them to spot the mistake given we were given the incorrect information almost 2 weeks ago.

Our First Direct mortgage application fee was to book the funds since there's only a limited amount available in the pot for mortgages at that rate.

CityTiger

Thanks for the comments everyone. I think Lemonsqueezer is right, if we think there is a complain to make then we should just make it regardless of what anyone on here says (although it does seem most agree that a complaint isnt unjustified).

Thanks for everyones input though.

amnblog

Someone made an error. It happens. Complain and they may offer you £25 or £50 for the inconvenience.

Be big and move on.