I have a interest only mortgage Can a bank open a repayment account without my instruction

Glenee123

Hi 
I closed my repayment mortgage in writing and asked the bank to convert the mortgage to interest mortgage, I received written confirmation that the repayment mortgage was closed and converted to interest-only also giving me the next 3 payment for interest mortgage. The following month the bank opened a repayment mortgage in my name with 5 debits amounting to around 550.00 litigation cost, without telling me or asking for my agreement, The credits went to the repayment the new repayment account.

A further 6000 litigation cost was added to the repayment mortgage/loan these amounts did not affect the interest mortgage balance.
Can the bank open a mortgage account in my name without my consent? 

Thank for any advice

Glen 

tacpot12

It will depend on the terms and conditions associated with the mortgage product you took out. You can ask them to provide a copy if you no longer have a copy. 

ACG

You dont open and close mortgage accounts. 

It sounds like you had a repayment mortgage and then asked them to switch it to interest only? If so, when did this happen? 
What does the written confirmation say? Does it say it was for a period of time (ie a few months) or indefinitely? Did they ask you to supply them some additional information (eg, when and how you would clear the balance) - if so, did you provide this? 

Thrugelmir

Unfortunately it's not possible to simply close a repayment mortgage and switch the terms to interest only permanently. Must be far more to this story. 

Glenee123

The bank agrees that they converted the repayment mortgage in 08/2007 and it was not only closed for a given period and the bank states that they opened a repayment element in 09/2007 for the bank's solicitor cost due from litigation for repossession attempt, which they have passed on to me.
The conversation to interest-only was not for a specific length of time and the bank does not claim that it was. 

My question is on these facts, can the bank open a repayment mortgage in my name without my knowledge or consent
Thanks

ACG

If that is your question then then I would not think that is legal. 
But I am 99% sure you are not asking the right question as I do not believe a bank would just open up a new account, unless in 2007 that was the only way they could transfer you from repayment to interest only, in which case it sounds like you gave them permission. 

MWT

There are clearly missing 'facts' here, what caused the banks 'repossession attempt' which apparently resulted in costs of over £6,000?

The recovery of that amount seems to be the trigger for the claimed unauthorised opening of a 'repayment mortgage'...

This feels more like the bank agreed to let the OP repay legitimate costs over time, secured against the property and opened the account to facilitate that...

dunstonh

Can the bank open a mortgage account in my name without my consent? 

Your use of terminology has confused the thread somewhat and has led to you asking questions that have different meanings to what I think you want to know.
It appears you created costs and the bank added them to the mortgage (probably in a sub account as that is most common) for you to repay over the term.   That is usually allowed.

They do not need your consent but it would not be without your knowledge.  They would have written at the time and you would have seen the sub account on the annual mortgage statements since.

Glenee123

ACG said:

If that is your question then then I would not think that is legal. 
But I am 99% sure you are not asking the right question as I do not believe a bank would just open up a new account, unless in 2007 that was the only way they could transfer you from repayment to interest only, in which case it sounds like you gave them permission. 

Hi ACG
Yes that is my question
The facts are how I stated above based on what I have said, I am asking is it legal for the bank to open a repayment account or even reopen in a customers name without out any agreement to do this, done without their knowledge or consent? the initial repayment mortgage ceased and there was no credit to capital element in 1st month after closing then the following month an account was opened with credit to the capital of .35p which went noticed by me for years.
I felt this type of thing may have happened to someone else in the forum on this website or someone would know if the bank has the right to do this.
Thanks for any advice

dunstonh

The facts are how I stated above based on what I have said, I am asking is it legal for the bank to open a repayment account or even reopen in a customers name without out any agreement to do this, done without their knowledge or consent?

Based on exactly what you are asking, then no it is not.     However, that does not seem to be what has happened in your case.

getmore4less

Glenee123 said:

ACG said:

If that is your question then then I would not think that is legal. 
But I am 99% sure you are not asking the right question as I do not believe a bank would just open up a new account, unless in 2007 that was the only way they could transfer you from repayment to interest only, in which case it sounds like you gave them permission. 

Hi ACG
Yes that is my question
The facts are how I stated above based on what I have said, I am asking is it legal for the bank to open a repayment account or even reopen in a customers name without out any agreement to do this, done without their knowledge or consent? the initial repayment mortgage ceased and there was no credit to capital element in 1st month after closing then the following month an account was opened with credit to the capital of .35p which went noticed by me for years.
I felt this type of thing may have happened to someone else in the forum on this website or someone would know if the bank has the right to do this.
Thanks for any advice

what was the balance in 2007 and now? If you are saying the capital element is 35p then that will just be an adjustment it happens on interest only mortgages with a set payment. as said you are not being clear. The mortgage is the security of the property, the account that sit under that security can change. I suspect what has happened you converted from repayment to interest only. The payment was not exact so there was a small(tiny) element of capital they are not interest only or repayment accounts they are just accounts that receive a payment(based on a calculation) the interest gets added and the payment gets taken off(often on the same day so you only see one change not two. The costs seem to have been added as separate sub accounts on a repayment basis. More details of the account rates payment needed