Mis Sold interest only self certify mortgage

csgohan4

https://www.bbc.co.uk/news/business-44851363

Didn't realise that not reading the Terms and conditions counts as mis sold, you reap what you sow

michaels

I have an io mortgage. I could pay it off but I won't because:
1) I earn more interest on the borrowed funds tan I pay to borrow them
2) I'd I am really lucky at some point it will be decided that it was 'miss-sold' or similar and I will get a big payout


Win-win

Thrugelmir

The era of ever increasing house prices.

At the time they already had debts of £58,000. And they were apparently unaware they needed to save up to pay off the capital when the loan matured.

Unfortunately they are far from alone. Soon there'll many people hitting the issue of having to settle interest only mortgages. 2020 onwards is going to see the peak of the problem materialise. A combination of rising interest rates and low wage growth isn't going to help either.

Edi81

How can you not realise they you need to pay the money back????

skint_chick

Not sure why they are complaining their house is going be sold when their plan to repay the mortgage was to sell the house and downsize. Maybe they should have put the house on the market when they realised they couldn't pay the mortgage in 2013. They still have equity, however small, so would have a deposit to pay 6 months rent in advance then get housing benefit once their capital was gone. Why didn't they do this 5 years ago? They've been lucky to get a year without being repossessed IMO.

I also don't get why they took on a mortgage of over £300k with debts of £58k - if it was cheaper/ around the same as renting then that makes sense but why didn't they reduce their unsecured debt down between 2008 and 2012. If it was more expensive to buy they why didn't they clear their unsecured debt first?

haras_nosirrah

Their issue isn't an interest only mortgage. A repayment mortgage would have made their inability to pay worse as they could have afforded even less per month.

Their problem was that they failed to protect themselves against being unable to pay their mortgage in the event of illness. Had they taken the income protection policy the advisor would have recommended them they would have been able to pay their bills despite the illness

People think they are invincible. While some may get lucky others will be in the situation of this poor family.

michaels

Thrugelmir wrote: »

The era of ever increasing house prices.



Unfortunately they are far from alone. Soon there'll many people hitting the issue of having to settle interest only mortgages. 2020 onwards is going to see the peak of the problem materialise. A combination of rising interest rates and low wage growth isn't going to help either.

Yep, if you add the million or less who have an io mortgage with no repayment vehicle to the 10m plus who are renting you end up with lots of people who won't own their own home on retirement. At least this who have rented from the bank will have paid less than those who rented from a landlord.

ACG

I would love to see the financial ombudsman/courts ask for copies of the customers self assessments in the year(s) following completion. You know, just to see how honest these people are.

My money is on their self assessments differing from what was put on their application by some margin.

There are too many things they are pleading ignorance to. You can not be that switched off and live in a half a mil home.

sal_III

They have my sympathy for their health issues.

I can sort of understand their ignorance back in 2008 when they took the mortgage.

But there is zero excuse for not sorting their s**t together from 2013 until today. There is plenty of information on the internet and they both have plenty of spare time not working to do some research on how to handle their finances better.

Instead they did what so many others do - started blaming everyone else but themselves for their problems.

Thrugelmir

sal_III wrote: »

They have my sympathy for their health issues.

.

Policies to protect income have been around for decades before. No different to insuring ones house against fire. We all have a choice.

minimike2

Edi81 wrote: »

How can you not realise they you need to pay the money back????

Of course they knew. They are lying because it didn't work out for them.