Self Certification scandal

Amme25

Without going into too much detail, I know there is a problem with the self certification process and far too many people (and that includes brokers) are getting away with fraud.

A few years ago I had the misfortune to have come across a local company who were openly promoting the fact that they could get ANYONE a mortgage. I reported them to the FSA on three separate occassions but they are still trading. In my opinion the biggest problem lay in the fact that credit checks were not always carried out or requested by lenders and their advisors were trained to do anything to get a deal.

On the other side its up to those individuals to pay. If you don't pay then the only outcome will be that you will lose your home.

In reply to toonfish about how an advisor could inflate figures without the client realising... advisor goes on first visit and fills in about 8-10 forms. They would take these away to process the best deal. Then they would go out for a second visit to discuss the results with the client; the results would be the worst case deal that they could find. By this time the forms would be unsuitable to send on to the lender so they would ask the client to 'sign blank forms and we will write them up back in the office to save time'. They would then write whatever they wanted on them to ensure they got the deal and then phone the client to tell them that they had found a better deal. This way the client would say yes and the commission was half way to the bank.

Not all mortgage advisors are like this I think I have just been unlucky enough to meet a large number of them.

toonfish

OK Amme - I take your point and that is the sort of fraudulent practice that needs to be stamped out.

If the client is not aware of inflating the salary that is one thing but I bet in 99% of cases they know perfectly well what is going on. We regularly get people walking in saying they "need a self-cert mortgage" on some occassions they have been referred here by a high street bank branch!

Amme25

I agree with your comments Toonfish. Certain individuals don't see it as lying and committing fraud but more bending the truth a bit.

I wonder what would happen if there was a change of practice and self cert mortgages were abolished. What would happen to all those people who have them when it comes time for them to remortgage?

Can a mortgage lender look into the details of an application after a customer has had a mortgage approved and adequately maintained a mortgage for a period of time i.e. could the mortgage lender say that a customer who had been less than truthful end up have their house taken off them?

ds1980

entrapment springs to mind. You can't tell me knowing that you were going in there to see what would happen if the ifa did this and that you didnt lead him/her somewhere.

Your evidence is not submissible in a court of law so i dont really understand why it has been done?

The person may get a few quid from his boss to politely go on his way but he can't be prosecuted in any way so im not sure gain what the emphasis is on?

If it is to show that it goes on then we all know it goes on it doesn't need a tape to prove it

Butlers1982

The problem with the UK nowadays is that there is a lack of personal responsibility and too much blame culture.

Here here agree with you one hundred percent

Kiernan809

Have seen this done first hand but not participated. Customers using self-certification mortgages generally know what they're doing the whole way along. Will generally find companies that are willing to help until they run out of equity.

Adv: The lender works on affordability, self-certification allows us to provide your earnings without proof. You need to be earning £XXX to get this mortgage. How much are you earning.
Customer: £XXX

Advisers fill in fact find giving figures required. Customer signs to say is accurate. In the short time I spent at the sub prime company that did business this way (worth noting I left before my probation ended and never advised here) the documents were sent out with a representative; they were not allowed to provide any advice but did earn commission on cases signed up.

nobblyned

Blimey, how irritating is the presenter on that program?

His interviewing technique seems to consist entirely of repeating the last thing the guest has said with an incredulous tone of voice. "I can only rent it for £500 per month" "Only £500 per month???"

As for sympathy for those who have lost money through their own lies? I have none

silvercar

We can all blame people for signing lies.

What about the brokers accepting some blame?

People go to brokers as the experts in their field. For FTBs and RTBs, they are looking to tap into the experience of the broker. The broker will have seen mortgage application forms each day, for the house buyer this could be the first ever application form they have seen. If the supposed expert completes the form, tells them that "this is how it is done", they know no different. If you put yourself in the hands of an expert, is it too much to expect them to be decent, legal and honest?

dunstonh

What about the brokers accepting some blame?

I think you will find the brokers that have responded have said it shouldnt happen and those doing it should be dealt with. However, the brokers that post here probably arent the type to be doing that sort of thing so they have no blame to accept themselves.

silvercar

I was refering to the brokers that make the fraudulent claims, not all brokers in general. There are bad eggs in every industry.