Mortgage Missold?

Bala99 · 15 October 2019 at 10:44PM

Started out thinking that I might be able to look into a particular mortgage we had which we were sure wasn’t calculated correctly.
We have a credit showing on the account after the mortgage was paid off.

We have queried it a couple of times and was told it wasn’t really there.

Then started reading about missold interest only mortgages.
We currently have one.
One of the things that I was reading was if an interest only mortgage was taken out and the term was beyond retirement age then it was missold.

Mortgage goes on till my partner is in his 70s. Even I will be beyond retirement.

I know we should have thought about it when we took it out but no one said anything and I will be honest it never crossed our minds.
First time I actually thought about paying the mortgage off in retirement was when I read about it today.

I know it is obvious but at the time we took the mortgage out in our defence we had 2 under 2s and my brain was mush and we were completely sleep deprived.

What exactly does it mean having been missold a mortgage and can you actually be compensated for it.

Thanks for reading and thanks in advance for any advice.

worried_jim · 15 October 2019 at 10:47PM

I don't think anyone has been compensated and it's just turning into a scam by the claims management companies after ppi has finished. What could you be compensated for? The roof over your head has cost less than if you had rented it, a win in most peoples book.

SonOf · 15 October 2019 at 11:26PM

Then started reading about missold interest only mortgages.

Which is virtually a non-issue with the FSCS and FOS both criticising CMCs for trying to drum up baseless complaints. The FSCS uphold rate on mortgages has dropped into single digit success rate.

One of the things that I was reading was if an interest only mortgage was taken out and the term was beyond retirement age then it was missold.

No. Not necessarily.

1- It only applies to advised sales. not non-advised sales (most banks were non-advised until 2012)
2 -mortgages were not regulated until Oct 2004 - So, only after that date
3 - an adviser could cover this off with a short risk warning in their closure letter
4 - there can be justifiable reasons. e.g. go beyond retirement age to keep the payments lower with the intention of using part of the pension tax free cash to pay it off.

What exactly does it mean having been missold a mortgage and can you actually be compensated for it.

Most complaints fail. Usually for being out of scope for consideration (pre-regulation and non-advised being most common). Of those that can be considered, most of those fail too. When complaints win, there is often no redress as the value of the property is often taken into account and how that has gained over the years.

A recent FOS decision said that redress would only be payable if the house was sold within the next 12 months at market value and if the value was less than the purchase price plus costs. The FOS is wise to these try-it-on complaints.

It will consider genuine complaints though. Some do succeed but its very low numbers.

There isn't enough info on yours to say. It would help to know when you bought the mortgage and if it was advised or non advised and whether you used a broker or a bank. And if the risk warning about retirement was in your closure letter.

Bala99 · 15 October 2019 at 11:44PM

It was definitely after 2004.

We were with the mortgage company and had come to the end of our fixed rate repayment and I rang them up to see if there was a better rate we could be on.

It was lower payments but wasn’t actually that much different at the time. We were put on an interest only tracker a few % above base.

What would I be compensated for?

That was my question.

I was reading about it all on moneyadviceservice (which I thought was a not for profit type site) and FOS websites and was trying to get my head round it.

Hadn’t clicked on the mortgage reclaim type websites.

Bala99 · 16 October 2019 at 12:05AM

The only thing I can remember is it was all done with one phone call.

Don’t even think we received anything to say we had changed the type of mortgage we had apart from a letter stating our new monthly payments.

LABMAN · 16 October 2019 at 12:07AM

There's nothing wrong with still paying a mortgage when you retire. If you were renting you'd be still paying. I've retired and have more income via pensions than I ever had when working.

Davy_Jones_II · 16 October 2019 at 7:00AM

It’s not clear what loss you believe that you have suffered, what exactly is it that you believe that you should be compensated for?

SonOf · 16 October 2019 at 10:37AM

It was definitely after 2004.

We were with the mortgage company and had come to the end of our fixed rate repayment and I rang them up to see if there was a better rate we could be on.

It isnt the date of the deal that matters. From what you have said, you already had the mortgage and this was the purchase of a new deal. New deals do not change the repayment type. So, you would have been on interest only before that deal.

foxy-stoat · 16 October 2019 at 10:47AM

You better start concentrating on your re-payment vehicle rather than chasing non existent compensation.

phillw · 16 October 2019 at 11:16AM

SonOf wrote: »

New deals do not change the repayment type.

Why not? Lenders who encourage you to move from interest only to repayment are just putting you on a new deal.

SonOf · 16 October 2019 at 11:32AM

phillw wrote: »

Why not? Lenders who encourage you to move from interest only to repayment are just putting you on a new deal.

That is a separate transaction and under MMR, it would require more work (information gathering, analysis, risk warnings issued and a new closure letter). So, certainly feasible for it to happen in interest-only to repayment basis but there is no logic for it to happen in the other direction.

Mortgage Missold?

Comments

Categories

Get our FREE Weekly email full of deals & guides - and it’s spam-free