Is my complaint against FirstDirect/HSBC unreasonable?

ACG

You are quoting something to do with fees but then talking about the interest rates.
The 2 things are different. 

Being completely honest with you, I suggest to clients that are within 2 weeks of completion that its best to keep the rate you have. If there is a problem or something goes wrong it does not give you much time to fix it. 

6 days is presumably 4 working days... I dont think it is completely unreasonable for them. Its not like they refused it, they just advised it could not be done in time. You have to realise that its work for someone somewhere. They cant just drop everything.

I dont want to say it is unreasonable, but at the same time I dont think First direct have been unreasonable either. They did it first time no problem and gave you the option of delaying and switching or not delaying and not switching. You having exchanged contracts is not their fault (nor yours, its just one of those things). 

kingstreet

I'm with ACG. We would have asked your solicitor how much time until completion and if they said six days we would have pointed out to you we could have the rate amended but couldn't guarantee the lender would be able to issue a revised offer and have a new certificate of title from your solicitor to meet the six day deadline.

You would have been given the choice - keep the completion date by leaving the rate alone or lower the rate and risk completion being late.

ItsIllak

OK, I understand that position better now.  Doesn't matter much if I accept it as it's now a done deed, but at least I do know "I'm being unreasonable"!  I do understand the argument.

But, I guess to get the last word and amuse myself...

I do think that this specific case should be called out in the conditions of the fee.  The reason they tell you that you can transfer it is that otherwise hardly anyone would be willing to put up £490 at time of application with huge risks that any problem with the purchase could mean that money goes down the drain or at least they're locked into a rate they don't want.  You'd, at least, delay your mortgage application to the minimum possible time if not find a lender that charges the fee when the mortgage is released (more honest IMHO).

So, just in my view, to avoid doubt and misleading customers into an agreement, it should specifically say that you will not reasonably be able to transfer that fee to a new rate (note, they don't say new mortgage product) in the final two-three weeks before completion because of their processes.

The suggestion that I could "delay the completion" is disingenuous (and was used by them at the time), as that's not really a legally viable option once exchange has happened.

Oh well, I think this all cost me between £1k (in the period of the fix) and £6-7 were you to extend that out for the lifetime of the mortgage. Frustrating, but not the end of the world.

ACG

You could exchange and complete on the same day, so theoretically what you wanted to do could be done up until a week before completion with a small amount of risk. Also if it were a remortgage, you might have happily delayed completion, so what they have said is not incorrect. Obviously in your case it was not possible but it helped them defend their complaint by giving you the option, you refused it because you were unable to do what was necessary just like they were not able to do what was necessary in the timeframes you were working to.

As I said, I am not trying to aportion blame. Its not cost you £6-7k as the mortgage is not tied in for the duration of the mortgage, so it has cost you a grand. 

Also you mention holding off in case rates dropped, but what happens if they increased. In todays climate either is quite possible. If you had helf off completing for another month rates may have dropped further, how far do you go? 

I dont think FD or the FoS rejecting the complaint is the right outcome personally. When I worked in complants I would have rejected it too. Again, not to say you are being unreasonable, but sometimes its just not meant to be and thats life. It does not mean anyone is in the wrong. 

PixelPound

ItsIllak said:

Which wording?  The quote?

So, you're saying that when they say I can "transfer to another rate", with the same fee, you don't think there should be scope to simply do that.  It should be assumed that I could re-apply to a new mortgage with the original fee being effectively refunded/repaid, but not simply have a new rate on the mortgage (which is basically what they've done - they have exactly the same product on the market but with a lower rate).

It depends on the process and where they were up to if contracts had been exchanged.

If you had started a mortgage and a couple of months in there were newer rates, would you expect to be able to swap to a lower rate without any new fees or penalties? There will obviously be a stage after which you can't simply change, whether 1 day after or a couple of months. The question is when had this occurred - is it the day the funds are released or some other day.

I suppose the question is what happens in those 5 days it took them to respond. Was there an undue delay to take it past a date of no return.

As to reasonability - if somehow the rates had gone up would it be fair if the bank made you reapply because the rates had increased? If not, then why is it okay for you to do it twice when the rates fell?

Hoenir

ItsIllak said:

 I couldn't do that because I'd already exchanged contracts. 

You do understand the legal implications of this and the failure if you fail to complete. Both your lender and your solicitor will be operating under strict guidelines in this regaard. As will not put themselves in a position where accusations for the failure could be levied at them. No one plays games or take risks. Your complaint was doomed to fail. As it's the entire process that needs to be considered. A case of the macro overruling the micro. 

BarelySentientAI

ItsIllak said:

OK, I understand that position better now.  Doesn't matter much if I accept it as it's now a done deed, but at least I do know "I'm being unreasonable"!  I do understand the argument.

But, I guess to get the last word and amuse myself...

I do think that this specific case should be called out in the conditions of the fee.  The reason they tell you that you can transfer it is that otherwise hardly anyone would be willing to put up £490 at time of application with huge risks that any problem with the purchase could mean that money goes down the drain or at least they're locked into a rate they don't want.  You'd, at least, delay your mortgage application to the minimum possible time if not find a lender that charges the fee when the mortgage is released (more honest IMHO).

So, just in my view, to avoid doubt and misleading customers into an agreement, it should specifically say that you will not reasonably be able to transfer that fee to a new rate (note, they don't say new mortgage product) in the final two-three weeks before completion because of their processes.

The suggestion that I could "delay the completion" is disingenuous (and was used by them at the time), as that's not really a legally viable option once exchange has happened.

Oh well, I think this all cost me between £1k (in the period of the fix) and £6-7 were you to extend that out for the lifetime of the mortgage. Frustrating, but not the end of the world.

It's not the condition of the fees where that caveat applies.  It's much more general.  Putting it specifically in the fees section would be misleading.  

It's more of a "changes to the mortgage can't be made within X days of expected drawdown".

After all, you still could change to a new rate without paying another fee.

Exodi

I think your being extremely unreasonable and have some sympathy that this was escalated to the FOS.

From my understanding, the points about the fee being transferable is a red herring and not terribly relevant to your complaint.

Your complaint seems to be that you notified them 6 days (possibly less if this includes weekends) before completion that you wanted to switch your mortgage deal again, and they told you it was only possible if the mortgage was delayed (which is totally reasonable and the position of virtually all the mortgage providers).

You then confuse the issue by conflating it with unrelated terms about fees, and a simplistic view where you imagine it as just a case of changing a number for the lender.

ItsIllak said:

So, just in my view, to avoid doubt and misleading customers into an agreement, it should specifically say that you will not reasonably be able to transfer that fee to a new rate (note, they don't say new mortgage product) in the final two-three weeks before completion because of their processes.

The suggestion that I could "delay the completion" is disingenuous (and was used by them at the time), as that's not really a legally viable option once exchange has happened.

Oh well, I think this all cost me between £1k (in the period of the fix) and £6-7 were you to extend that out for the lifetime of the mortgage. Frustrating, but not the end of the world.

I don't think customers are being misled, lenders don't make a secret that you can't switch deal in the 11th hour, this is obvious to most people.

You may think it is disingenuous but there would have been no pleasing you. If they outright said 'No' because they took a view that delaying your completion is impractical, you would have still taken them to the FOS, quoting your terms above' for them refusing to facilitate a rate switch for you at all. They've made it clear that they can switch the rate, but it would mean delaying completion. You decide what you want to do with that.

No, it hasn't cost you ~£1k (or the weird cynical Maths were you apply it for the entire term of the mortgage to depress yourself further), it has cost you nothing, because it wasn't possible with any lender to change rates at that short notice. If you're not kicking yourself for rate changes the day after completion, you shouldn't be kicking yourself about rate switches in the two weeks before.

If I'm completely honest, you've made this into a much bigger drama in your head than it is.