Wrong mortage advice given when bereaved

pengoat

I am making a complaint to Santander about the advice I was given on my mortgage. I want to know what sort of outcome I can expect.

My husband died in December 2018 aged 62. I am 61 in full time work. We had a joint mortgage on our house. Interest only. Paid regularly. The mortgage (and the rate deal) were due to expire in June 2019.

We planned to sell and downsize in 2019. Santander had previously advised us that we could stay on by arrangment for some months or longer whilst selling the house after the mortage ended.

I called Santander bereavement team in January 2018. I was in no state to make big decisions about moving home and wanted to know what would happen. I had several phone conversations with the mortage team that they referred me to. I was reassured that no one would be making me move out before I was ready to.

I told them due to the stress over my husband's death I would want to stay in the house for up to 2 more years. They said all I had to do was contact them every 6 months with an update on my plans. They would allow me to pay the same monthly payment - it would not change in June 2019 when the mortage ended. I simply had to call in June and give them an update.

I did this and was told I'd been given the wrong advice by them in January. They admitted the error - it was on their notes. They advised me to put in a complaint, which I have.

They said I need to apply for an extension to my mortage and in the meantime pay the market interest rate, which doubles my montly payment. They could not guarantee how long they would let me stay in the house, but gave me a month's grace to get financial advice. Although they offered me a mortage extension deal, when they did the affordability calculation the deal only covers 2/3 of what I owe on the mortage.

I am so angry. I am getting independent financial advice on this but also am very worried at the moment. What I want is for Santander to honour the advice they gave me in January and allow me to continue to make the same monthly payment for the next 12 months at the very least. I intend to sell put the property on the market late 2020 or early 2021 (ie approx 15 - 20 months from now) and want some firm reassurance from Santander that they will allow this.

Any advice welcome

ACG

I am not sure they will allow you to make the same monthly payments for an ongoing period of time.

You may get them to agree to it for 3-6 months to give you chance to get a new deal with them or elsewhere or to sell up - but who knows? If you do not ask, you do not get.

dimbo61

Did you have Life assurance in place to cover repaying the mortgage in the event of the death of either person on the mortgage if a joint mortgage ?
Did you receive a payment from your husband's employer ? Many companies have life assurance paying up to 2 years income in the event of a member of staff dying in service.
Do you have an endowment policies in place ?
How were you going to pay off the Interest only mortgage ?

pengoat

No, we do not have an endowment policy in place or any other means of paying of the interest only mortgage. There is enough equity in the house to buy the sort of property I want as well as pay off the mortgage when I do sell up and downsize. However this involves a big move from London to Devon and it is not something I can face this year at least and was told I wouldn't have to worry about this.

csgohan4

Unfortunately the lender is not under obligation to give you the same deal as this expired in June 2019 as per your contract, however they can extend the mortgage time to allow you time to downsize and sort out your affairs, however this is entirely at the discretion of the lender.

Call them again and get something in writing to confirm any extension, I presume they have recorded calls from previous, so that would be a good start for your complaints

pengoat

They say they have notes about the calls made in January. Their complaints team is looking into things now. I only made the complaint a few days ago so it's early days. I do not know if they recorded the calls I made to the team but I asked very specific adn detailed questions about what I'd be paying monthly from June onwards and was told several times during the course of the call that I would be paying the same rate till I was ready to move.

TrickyDicky101

Have Santander responded to your complaint (when was it raised if not)?

You have the option to refer the complaint to the FOS (Financial Ombudsman Service) if the time since complaint is past 8 weeks OR if Santander have already given their final response and you are not satisfied.


EDIT: I cross-posted with you so see the complaint is very recent. Try not to worry too much and await their response.

dunstonh

I am not sure Santander are being unreasonable. These periods following bereavement are temporary. When they say take as long as you need, they do not mean forever. Plus, the original mortgage term still exists.

In situations like this, where there isnt any wrongdoing and you are looking at a goodwill gesture from the bank, you can never call the outcomes as you just dont know how they will react.

Was it a mistake in what they said or was it a misinterpretation of what they really meant. Even if it was a mistake in what was said, it does not mean they have to do what was said. A mistake does not give you entitlement. Unfortunately, you need to wait and see the outcome and hope for some goodwill on their part.

Thrugelmir

Some considerable time ago Santander would have written to you , on more than one occasion, asking how the interest only mortgage was to be repaid. Did you respond to these letters.

owen_money

Thrugelmir wrote: »

Some considerable time ago Santander would have written to you , on more than one occasion, asking how the interest only mortgage was to be repaid. Did you respond to these letters.

I know they should do, but I had a Santander IO mortgage for 18 years and not once did write to me asking how it would be repaid, although I did have a plan in place to pay it back, and no they didnt require proof of this when I took the mortgage out

Kentish_Dave

I am sorry for your loss.

While I understand that this is hard, you can’t generally expect to be given something that was offered in error, and this is especially the case on something as big as your mortgage.

Being told you get a free cup of tea with a slice of cake is one thing, being incorrectly advised that you would have completely the wrong rate applied to your mortgage in perpetuity really is another.

The original deal that you signed up to still stands. You can maybe expect a few hundred pounds goodwill payment for the misunderstanding, but at some point soon you will need to pay back the principal.

Could you sell and then rent something inexpensive where you now live, to reduce the stress of selling and buying at the same time?