Equity Release missold?

TJI999

Thrugelmir said:

sourcrates said:

Most who will respond to your post are all "on the ball", internet savvy types who will say how can they not have understood what this product was and how it worked blah blah blah.

My parents didn`t know one end of a computer from the other, the insurance man that called every week was the font of all knowledge, and what the hell is a Google ?

That generation never thought to question things like we do now, it was not in the nature of most of them to do so, naivety ?  maybe, trust in what you were told is a more likely explanation.

Making a complaint won`t cost you anything, you may or may not have it upheld, personally I would say these equity release loans were not always fully understood by those who took them out.

So you have nothing to lose by complaining, and indeed it is your most explicit right to do so, you may not win, but at the very least you will know you have tried to help your folks out.

Biggest concern of those who post with claims of misselling is the loss of their hoped for inheritance. Never had an interest in how their parents managed their finances previously. Not that finance is a commonly discussed matter between generations until needs must. 

I've no doubt that's the case with some. Not in this case though, we're in a fortunate position and will be able to buy them out of the policy if the complaint fails. I don't want a penny from them, just angry that they've been fleeced by a company flogging loans to people that don't need them. 

csgohan4

sourcrates said:

Most who will respond to your post are all "on the ball", internet savvy types who will say how can they not have understood what this product was and how it worked blah blah blah.

My parents didn`t know one end of a computer from the other, the insurance man that called every week was the font of all knowledge, and what the hell is a Google ?

That generation never thought to question things like we do now, it was not in the nature of most of them to do so, naivety ?  maybe, trust in what you were told is a more likely explanation.

Making a complaint won`t cost you anything, you may or may not have it upheld, personally I would say these equity release loans were not always fully understood by those who took them out.

So you have nothing to lose by complaining, and indeed it is your most explicit right to do so, you may not win, but at the very least you will know you have tried to help your folks out.

I agree up to a point. But one cannot hold up the 'elderly I am vulnerable card' for everything. 10 years ago, they were in debt they found a solution, albeit expensive one to wipe their debts at the same time with some to spare to spend as they wish 

If you were 8k in debt, you would usually borrow 8k, but they borrowed more only they will know why. 

They were not forced to sign under duress. 

I agree most companies may take advantage of the 'elderly' by ripping them off on renewals. My parents were in this position, paying 500+ for house insurance. They didn't haggle and just accepted it. Who's fault was this? Not the company, but my parents. 

I made the active decision to take over their insurance renewals and utilities and saved them a boat load of money. 

Sometimes it isn't always someone else's fault. Being 'elderly' is not always an excuse for not picking up the phone and haggle. If they are unable to, NOK, friends, relatives e.t.c. 

I am sure there will be a time when they will lose their capacity and unable to do such things. Power of attorney will hopefully kick in. If not one will have accept they will be paying high renewal prices, however with the recent news insurers may have to offer the same price for renewals as new customers is promising. 

There has also been countless threads on mis sold interest only/self declaration mortgages. We cannot use age as an excuse, only they too are looking for someone else to blame and seek compensation. 

Age is not an excuse for not taking responsibility for one's actions as an adult, sadly alot of these posts are due to the alleged affect on their inheritance which is unfortunate. Rather than learning from their mistakes they seek blame which is typical culture and pattern seen on here.  

We've have all lost money doing things in our life, I've had my fair share of dodgy LL on Gumtree as a younger self, I blame only myself for being naïve and certainly not because I was too young to not know it all. Conversely could you argue one's parents were too old as they in theory they had more wisdom than you. 

dunstonh

- Other than the initial 8k to pay off loans (for double glazing and a small credit card debt), they have never touched the remaining money and clearly did not need it.

The decide the amount to take.  No-one else.

- As family members, we did not know about this until years later but could have easily sorted their debt but being of that generation, they didn't discuss with us.

Perhaps they were embarrassed at their lack of financial planning.  Equity release is generally regarded as an option of last resort.   It is often seen as a sign of failure by some.

- They need some small adjustments to their bathroom/shower due to my Mums stroke. They would have been eligible for help with this work but because they have the remainder saved they will probably not be now. 

Incorrect assumption.

- They clearly did not understand that the interest accrued is compound and now are very upset and feel naive/foolish for entering into this.

Equity release, for many years now, has included solicitors who make sure that the borrowers are able to understand what they are doing and the consequences of their actions.     This is in part to protect the borrowers from making a mistake but also to protect any adviser involved from spurious complaints from relatives disappointed that their inheritance has been reduced.

Do we have grounds to complain here? 

Nothing you have said hints at missale.     You have offered a retrospective opinion on something that took place where you have no seen the documentation or gone through the process.  

Did they receive regulated financial advice or did they bypass that and go non-advised?

You are accusing the solicitor of failing to do their job.  However, I know what the solicitors do and what they say and there is no way that anyone could be unclear to what they are doing.  The solicitor is independent of the lender and any adviser (if one involved).  

I want to get them out of this ASAP and feel very angry that they seem to have been sold a product that they clearly didn't understand and more importantly didn't need.

How do you know it was sold and not bought?  If it was "sold" then what does the written report state about the advice?  (I assume you have read it as that explains the reason why behind the decisions and all of the risk warnings).  And it sounds like they did need it from what you said.   The amount may be a little higher than what they initially needed but it is common to see a higher amount taken to avoid fees for coming back for a second or third time later (modern ones have drawdown functionality but older ones didn't).  £25k for around £8k immediate need is not unreasonable.   It would give them the immediate need and a small emergency fund for the future.

I am not saying it was not missold.  Just that, so far, there is nothing to suggest it was.  However, there are some pretty big holes in the information you have supplied us and I suspect you don't know about most of it either.    You are effectively accusing the lender, the arranger and the solicitor of misselling.   To have all three misselling would be very unusual.   The whole point of bringing in the solicitor was to ensure that these things were avoided and it has largely worked..

Thrugelmir

TJI999 said:

Thrugelmir said:

sourcrates said:

Most who will respond to your post are all "on the ball", internet savvy types who will say how can they not have understood what this product was and how it worked blah blah blah.

My parents didn`t know one end of a computer from the other, the insurance man that called every week was the font of all knowledge, and what the hell is a Google ?

That generation never thought to question things like we do now, it was not in the nature of most of them to do so, naivety ?  maybe, trust in what you were told is a more likely explanation.

Making a complaint won`t cost you anything, you may or may not have it upheld, personally I would say these equity release loans were not always fully understood by those who took them out.

So you have nothing to lose by complaining, and indeed it is your most explicit right to do so, you may not win, but at the very least you will know you have tried to help your folks out.

Biggest concern of those who post with claims of misselling is the loss of their hoped for inheritance. Never had an interest in how their parents managed their finances previously. Not that finance is a commonly discussed matter between generations until needs must. 

I've no doubt that's the case with some. Not in this case though, we're in a fortunate position and will be able to buy them out of the policy if the complaint fails. I don't want a penny from them, just angry that they've been fleeced by a company flogging loans to people that don't need them. 

Suggest you calm down and find some evidence before throwing accusations around. 

[Deleted User]

OP - Id just complain if I was you. 

As said above you have nothing to lose. If you havent already get them to sign power of attorney. You can deal straightaway, you dont have to wait until they lose capacity. 

I can see why you are angry. They go to a show, no plans to get an equity release, just want to pay debts off. They get talked into ER and its goes from there. 

You might win, you might not but at least you tried. Id not bother arguing with naysayers on here. Most never agree with anyone complaining. 

Where as my complaining got me a fund valued at millions over my lifetime. Im always of the view, dont ask, dont get. 

Good luck 

Thrugelmir

Densol said:

I can see why you are angry. They go to a show, no plans to get an equity release, just want to pay debts off. They get talked into ER and its goes from there. 

Did you attend the same event 10 years ago given you are so well informed? 

[Deleted User]

Densol said:

OP - Id just complain if I was you. 

As said above you have nothing to lose. If you havent already get them to sign power of attorney. You can deal straightaway, you dont have to wait until they lose capacity. 

I can see why you are angry. They go to a show, no plans to get an equity release, just want to pay debts off. They get talked into ER and its goes from there. 

You might win, you might not but at least you tried. Id not bother arguing with naysayers on here. Most never agree with anyone complaining. 

Where as my complaining got me a fund valued at millions over my lifetime. Im always of the view, dont ask, dont get. 

Good luck 

I agree with most of this but I would stress that OP needs to figure out what they are complaining about and who the complaint is to. The information given thus far will be hard for anyone to assess to see if there is a viable complaint.  for example:

Is the complaint against the advisor? If so then was it an advised service in the first place and what does the fact find say about the reason for the extra funds.   Did the advisor explain that they may be able to make payments on the interest to stop the balance increasing? 
Is the complaint against the solicitor for not pointing out the risks or not spotting a vulnerable client
Is the complaint against the firm for using confusing literature?

The best chance of a having an upheld complaint is to be clear what you are complaining about.   'My parents are old and didnt appear to need the money' isnt grounds for a complaint.  There may be a complaint here, but OP needs to cut out the emotion and find the actual regulatory breach

TJI999

Thanks for this guys, whether you think I've got a case or not. Some really helpful stuff here (mostly! 🤣). Understand the personal responsibility thing of course. Just sad to see two people feeling like they've been massively foolish. 
Have spoken to a couple of financial advisors who think these will be the "new PPI" in years to come. We'll see what happens. 

[Deleted User]

Thrugelmir said:

Densol said:

I can see why you are angry. They go to a show, no plans to get an equity release, just want to pay debts off. They get talked into ER and its goes from there. 

Did you attend the same event 10 years ago given you are so well informed? 

Yes !! Im sure I saw you there too 
Were you wearing the grey suit ?

MWT

TJI999 said:

Thanks for this guys, whether you think I've got a case or not.

Keep in mind that the question is do your parents have a case, not you.

Are they sharing your sense of having been mis-sold to extent that they will be able to clearly state and substantiate that they were not properly informed about the way the interest would build up, or are they agreeing with you and your feeling that they must have been misled..?

This is going to be on them to explain their motivations and how the process was handled and why they didn't understand the product, against the documentation and files of the solicitor and advisor and the fact that they will almost certainly have signed documents that confirmed that they understood the product and the way the interest would grow...

I'd start with checking the documents they have and see if there is any ambiguity there and see where that takes you...