Ofset Mortgage ? misold

jakki123

My ( now ) husband took out an offset mortgage with The One account nearly 20 years ago. This was with an ex partner not me. He did not understand it was an offset mortgage and had not realised how this worked. After he had been paying it for nearly 19 years we realised that nothing had been paid of the original amount borrowed and that only interest had been paid each month. We are both in our fifties now so had to change mortgages quickly and now have a simple repayment mortgage with high premiums each month but at least our house is safe. We have tried to complain to One Account that this was misold as my husband was never a saver and should have been advised to have a repayment mortgage. He was never advised to take out any sort of ISA or endowment to cover the total amount. This was completely the wrong product for him. The One Account and the ombudsman have both dismissed out complaint and so I think we have to accept the findings but still feel that this mortgage was missold. We could have come to the end of the mortgage and lost our house. At no point during the contract did we hear from the The One Account to advise us that we were not paying any of the actual mortgage amount off and that we were at risk of losing our home if this didn't change. After our complaint they said they were just about to inform us which seems convenient!
Has anybody else had a similar experience?

foxy-stoat

There has been a few interest only mortgages where the lenders write to the poor sap 5 years or so before its due to end to ask how are they planning on repaying the capital, I think now its more frequent but he would of had an annual mortgage statement....well he should of had 19 of them so it shouldnt of been that much of a shock.

Selling the property is an option but at least your husband has realised that the capital needed repaying and switched to the repayment mortgage.

dunstonh

My ( now ) husband took out an offset mortgage with The One account nearly 20 years ago.

Mortgages were not regulated 20 years ago. That started in October 2004.

He did not understand it was an offset mortgage and had not realised how this worked.

The old Virgin offset mortgage didnt need to be run as an offset. The functionality was there if you wanted it but it could work conventionally.

Most Virgin mortgages were bought without advice direct from Virgin.

After he had been paying it for nearly 19 years we realised that nothing had been paid of the original amount borrowed and that only interest had been paid each month.

That isnt to do with it being an offset mortgage. That is to do with it being an interest only mortgage.

Virgin send out annual statements and each of those would have showed the balance being the same. And since about 2008, they have issued warnings on interest only mortgage that you need to have plans to repay the capital.

So, why hasnt your husband done anything about it?

We have tried to complain to One Account that this was misold as my husband was never a saver and should have been advised to have a repayment mortgage.

if you buy without advice, then you cannot complain that you were not advised something. He chose to cut out the mortgage adviser and go direct. DIY can save you money if you DIY well. However, it can be a costly mistake if you DIY badly.

The One Account and the ombudsman have both dismissed out complaint and so I think we have to accept the findings but still feel that this mortgage was missold.

It woudlnt have been missold. It was misbought.

We could have come to the end of the mortgage and lost our house. At no point during the contract did we hear from the The One Account to advise us that we were not paying any of the actual mortgage amount off and that we were at risk of losing our home if this didn't change.

Your husband signed a contract with the lender that had big warnings on it that it was interest only. Virgin have issued warnings on their annual statements and periodic letters warning about interest only mortgages. So, you are mistaken about the warnings.

The last time I had someone similar to this, it turned out that the husband was hiding the letters from the wife and had buried his head in the sand. The spouse was blaming everyone except the husband until he broke down and admitted it.

There is no third party to blame here. This lies solely with your husband and his choices. You need to look forward and decide what you are going to do now. Switch to repayment and extend the term? use savings/pension lump sumes to reduce or repay the balance? An adviser would help in this area. Just as they would have done 19 years ago.

getmore4less

The One Account was really an overdraft secured by the mortgage on property.

For this category(offset/cam) of borrowing the OA was quite expensive and should have been reviewed and changed years ago.