John Charcoal mortgage

nigel1457

Hi, this is going back a few years, however, i think it's worth me asking for advice. In 1988 I had a "low start - low cost" mortgage with John Charcoal Mortgage Brokers and in the first year the repayments were only 80% of total that would have been made in a standard repayment mortage. Year 2 the repayment was then 85%, year 3 - 90%, year 4 - 95% and then in year 5 - 100%. What was NOT fully explained to me was that the unpaid interest amount for the discounted years would be rolled up. This meant that when the property was sold there was £14000 of unpaid interest that had to be paid. This was a complete and totally unexpected outcome. Is there a case here of mis-selling along the lines of PPI compensation? Looking forward to a response. Many thanks, Nigel

ACG

It was pre regulation so you would probably be relying on their generosity to give compensation but no harm seeing what they say.

normanna

How did you think you would pay it back? If the T&Cs are clear and you signed them then I don't see you having a case - you should read them first to make sure how the interest was applied was what was stated in the signed contract.

Thrugelmir

Do you still have the product literature. Many people have poor recollections of what was said a week ago let alone 30 years. No doubt at the time "low cost" enabled you to do something you'd otherwise been unable to achieve. What do your annual mortgage statements disclose?

dunstonh

What was NOT fully explained to me was that the unpaid interest amount for the discounted years would be rolled up.

I seem to recall that there was disclosure on low start mortgages that stated the interest would be added to the debt. Are you sure your mortgage documents do not state this?

Plus, in the 80s, people still went to a local solicitor for conveyencing and that solicitor would read the offer letter to the borrower and point out risks.

What do you have on file that suggests these warnings were not given?

This was a complete and totally unexpected outcome.

Did you never remortgage to another lender or mortgage deal over the years? That would be quite rare. Although entirely possible.

Is there a case here of mis-selling along the lines of PPI compensation?

No. Mortgages were not regulated until October 2004. So, even if you had a nailed on case (by modern standards) yours is pre-regulation and the complaint can be refused on that basis. (and you would expect it to be).

cado1

normanna wrote: »

How did you think you would pay it back? If the T&Cs are clear and you signed them then I don't see you having a case - you should read them first to make sure how the interest was applied was what was stated in the signed contract.

Slightly hash response normanna

Pre financial crisis and MCOB T&C's were not made clear to borrowers and many borrowers didn't think to ask questions they put their faith in the person giving the advice, this is how come so many people bought into the endowment fiasco and are now lumped with interest only mortgages they can't pay back with out selling.

I would suggest you approach Charcoals or the lender direct to see if they have any copies of the original paperwork signed and T&C's and then go from there. It may not be a case of "miss selling" as such but they may be prepared to review the advice you were given at the time.

dunstonh

I would suggest you approach Charcoals or the lender direct to see if they have any copies of the original paperwork signed and T&C's and then go from there. It may not be a case of "miss selling" as such but they may be prepared to review the advice you were given at the time.

What advice?

A mortgage from that era would have little or no audit trail. It didnt need the advice documentation that was required post October 2004. Mortgages were not classed as advised or non-advised back then.

The current John Charcoal was authorised in 2015 and the company was only set up in 2014. The old John Charcoal company changed hands a number of times and liability did not follow. e.g. B&B bought them in 2000 but sold it later.

You would be asking the current John Charcoal company to voluntarily accept liability for a case that they did not put in place and almost certainly have no documentation on.

normanna

cado1 wrote: »

Slightly hash response normanna

Not harsh at all. A genuine question to the OP - they knew they were under paying interest at the time so they must have had some idea of how they were to repay it. If they didn't remember i suggested they check the T & C and to check if the mortgage company complied with those.

Nearlyold

nigel1457 wrote: »

Hi, this is going back a few years, however, i think it's worth me asking for advice. In 1988 I had a "low start - low cost" mortgage with John Charcoal Mortgage Brokers and in the first year the repayments were only 80% of total that would have been made in a standard repayment mortage. Year 2 the repayment was then 85%, year 3 - 90%, year 4 - 95% and then in year 5 - 100%. What was NOT fully explained to me was that the unpaid interest amount for the discounted years would be rolled up. This meant that when the property was sold there was £14000 of unpaid interest that had to be paid. This was a complete and totally unexpected outcome. Is there a case here of mis-selling along the lines of PPI compensation? Looking forward to a response. Many thanks, Nigel

Are you saying you never received any statements from 1988 onwards until you sold the property which showed the amount outstanding and included any rolled up interest either incorporated in the overall debt or in a sub account? What were you led to believe at the time would happen to the underpaid debt? How long ago did you sell the property - if it was more than 3 years ago any "complaint" could be time barred.