Mortgage offer retracted during house sale due to Santander error

rachello13

On 18th Jan I went to Santander to apply for mortgage in principle. Was honest about negative credit score after a divorce left me saddled with all debts. Application was approved and we made offer on a house. On 8th Feb we made full mortgage application and again this was approved - our solicitor and I received full mortgage offer including property valuation on 22nd Feb
On the afternoon of 22nd Feb I received an alert from the money saving expert credit score tool - upon investigation I had a new address linked to me - somewhere I had never lived but was one house number away from a previous address. 
Contacted Santander immediately as was concerned that my application was wrong, and that I had an incorrect address linked. Long story short their 'typo' led to my past default being missed and mortgage application was resubmitted and declined against correct address. 
I am already 7 weeks into a house purchase and only made the offer based on having mortgage in principle. 
Any advice appreciated on how Santander can get away with this and what I do next. I have contacted unbiased.co.uk to seek independent mortgage advice but I really do not understand how a mortgage offer can be made with such a glaring error? Through my honesty I have now lost a mortgage, yet their system did not flag that the incorrect address was not associated with me in anyway? 
Massive mortgage loophole for anyone with default on record? 

EverythingIWant

Ouch. I can only imagine how bad you must feel. Not a lot you can do, Santander will only go off whatever their criteria states and the default you had at that address obviously meant you were outside of their criteria. It maybe a case of ‘bitter pill to swallow’. I am sure a good broker can help you secure another offer though!

Thrugelmir

Clerical errors do happen. No one is immune. Expect those responsible to receive a suitable warning. 

Brock_and_Roll

Forget about Santander - best you are going to get is an apology and £10 Woolworths voucher!
If you still want to proceed with the purchase, I suggest you speak to a broker asap given what you say about debts etc

Retired_Mortgage_Adviser

Any advice appreciated on how Santander can get away with this and what I do next. 

Complain complain complain. Make a formal complaint (use the MSE Resolver tool) to Santander, outlining the financial cost and incovnience caused by their error. Make it clear that you will take it to the Ombudsman if they don't make you whole.

Wait for a final response or 8 weeks and then take it to the FOS (the FOS will charge Santander £550 when the case is closed).

It's a very straightforward process and if all this is as a result of an error on their end, based on my experience of the process, the FOS will most likely rule in your favour.

Good luck, don't let them get away with it.

Brock_and_Roll

Retired_Mortgage_Adviser said:

Any advice appreciated on how Santander can get away with this and what I do next. 

Complain complain complain. Make a formal complaint (use the MSE Resolver tool) to Santander, outlining the financial cost and incovnience caused by their error. Make it clear that you will take it to the Ombudsman if they don't make you whole.

Wait for a final response or 8 weeks and then take it to the FOS (the FOS will charge Santander £550 when the case is closed).

It's a very straightforward process and if all this is as a result of an error on their end, based on my experience of the process, the FOS will most likely rule in your favour.

Good luck, don't let them get away with it.

Not going to help with getting a mortgage though!

Retired_Mortgage_Adviser

Brock_and_Roll said:

Retired_Mortgage_Adviser said:

Any advice appreciated on how Santander can get away with this and what I do next. 

Complain complain complain. Make a formal complaint (use the MSE Resolver tool) to Santander, outlining the financial cost and incovnience caused by their error. Make it clear that you will take it to the Ombudsman if they don't make you whole.

Wait for a final response or 8 weeks and then take it to the FOS (the FOS will charge Santander £550 when the case is closed).

It's a very straightforward process and if all this is as a result of an error on their end, based on my experience of the process, the FOS will most likely rule in your favour.

Good luck, don't let them get away with it.

Not going to help with getting a mortgage though!

Of course not. I was answering the question as to how to set things right with regard to the mess-up by Santander.

OP mentions that he/she is already in the process of getting independent whole of market advice, which (in my admittedly biased opinion) they should have done right at the outset!

rachello13

Thanks everyone. After picking myself back up I have split the problem into two. I've made a formal complaint to Santander via the CEO which has already been acknolwegded and I have made very clear it will go to FOS. 
After the experience I have had I don't actually want to deal with Santander for a mortgage, a friend has recommended an independent mortgage broker who has grilled me to within an inch of my life (asked lots more questions about the bad debt than Santander ever did) and is calling me later today with a way forward. 
The whole experience has been scary and stressful but I'm trying to stay positive and fingers crossed we can still get a mortgage, perhaps not as good a rate but my divorce related bad debts will be off my credit record in a years time and hopefully life will go back to normal  

Retired_Mortgage_Adviser

Well done for filing a formal complaint, do make sure you take it to the FOS if they don't offer to compensate you adequately for their catalogue of errors.

The fact that the broker has gone in depth into your credit history is good. Hopefully he/she will be able to place your case at an affordable rate. I wish you good luck!

[Deleted User]

Wow, this is terrible - I'd hope given what's gone on, the complaints team would take a sensible view and override the new decline - but it depends on the defaults of the default etc - how far outside of policy is it (or if it's due to low score, just how far short are you - 1%, they might consider... 70% short, probably not). I think getting the process moving elsewhere is probably preferable to waiting around to see what Santander do though.

I can see how it was missed - I've picked up a few instances before where somebody has keyed the wrong number/postcode (and some of them I'm certain have been done deliberately - as you say, it is a loophole to try and hide credit). There are various systems and checks in place (manual and automated), but they aren't foolproof.

Underwriters may also check, but a lot of the time it wouldn't occur to them to check each address 1 by 1. If you've got a pass credit score, then you've got a pass..... Presumably there was plenty of credit at current address, which means they were happy they did have an accurate picture and didn't probe too deeply - if, for example, they reviewed your case and you only had 1 x current account and a water bill, they'd check everything a hell of a lot more carefully and the error would come to light.

The only thing I would ask is were you given a copy of the application to check and sign? Although they shouldn't have made the error, they could argue you are at fault for not picking it up if the error was visible on any documentation they've sent you.

I do hope you get it sorted elsewhere though, sounds like you've made a good start with the new broker - if the broker is so informed about your adverse, when it gets to a new lender they'll be able to push it through in the best possible way for you

rachello13

Somerset_La_La_La said:

Wow, this is terrible - I'd hope given what's gone on, the complaints team would take a sensible view and override the new decline - but it depends on the defaults of the default etc - how far outside of policy is it (or if it's due to low score, just how far short are you - 1%, they might consider... 70% short, probably not). I think getting the process moving elsewhere is probably preferable to waiting around to see what Santander do though.

I can see how it was missed - I've picked up a few instances before where somebody has keyed the wrong number/postcode (and some of them I'm certain have been done deliberately - as you say, it is a loophole to try and hide credit). There are various systems and checks in place (manual and automated), but they aren't foolproof.

Underwriters may also check, but a lot of the time it wouldn't occur to them to check each address 1 by 1. If you've got a pass credit score, then you've got a pass..... Presumably there was plenty of credit at current address, which means they were happy they did have an accurate picture and didn't probe too deeply - if, for example, they reviewed your case and you only had 1 x current account and a water bill, they'd check everything a hell of a lot more carefully and the error would come to light.

The only thing I would ask is were you given a copy of the application to check and sign? Although they shouldn't have made the error, they could argue you are at fault for not picking it up if the error was visible on any documentation they've sent you.

I do hope you get it sorted elsewhere though, sounds like you've made a good start with the new broker - if the broker is so informed about your adverse, when it gets to a new lender they'll be able to push it through in the best possible way for you

No we were not given anything to sign that had any previous address detail on. I checked that straight away as I worried I had missed something. I work as a quality manager so I'm pretty picky and would like to think I would have seen it, but you never know do you. 
So far mortgage broker seems to be getting us sorted, so I'm confident we will be able to proceed (a little more stressed out than when we started!). Then we will see what Santander will come back with. I imagine they may want to look at overriding their decision, but that's not what I've asked for the experience has left me not wanting to do business there to be honest. I just want them to admit some responsibility and apologise because so far they haven't at all.