***If you have a mortgage then this is for you***

[JonCris]

The founding father of PFI?? ........................... Benito Mussolini ...... apparently

[midge61]

So if Redstones are not a mortgage company and you have a mortgage handled by them and you can get no help then surely the next stage is to contact your mortgage originator and ask the same questions of them.

 

Then if you get a similar reply ie. no help can be offered what next?

 

So in light of the CML and Banking codes stating that if you are facing financial difficulties contact your lender for help and advice and you now have it in writing that they CANNOT not won't help surely there must be some sort of legal recourse you can take against them.

 

The FSA will have to do something as it means your mortgage contract has been removed from the mortgage company and is now rather meaningless.

How the hell can they justify this being allowed to happen.

[midge61]

So is reason for the collapse of this market in US that they kept handing out mortgages without proper checks purely to meet the demands for such portfolios and then when so many people had been lent money without the means to repay and thus defaulted these portfolios ceased to repay the dividends promised and thus becam un-sellable.

 

Not sure if I am getting this right or not.

[JonCris]

I think more pertitent to any argument is that these mortgages have been sold to an unsuspecting consumer under false pretentions........... In that the consumer assumed, having not being told anything different, that although paying a higher rate for their mortgage they where still entitled to the protection, safeguards & codes of practice as per any prime mortgage.

[JonCris]

They bundled these sub-prime mortgages together with other loans so, it's alleged, they give these SPV's the highest triple A rating thereby making them appear less risky & much more valuable than they are

 

Currently a number of State DA's & the FBI are investigating the selling & rating of these vehicles. So expect a few corporate CEO's ending up in Denver pleading their innocence before the hanging no nonsense Judge, Judge St Eve

Edited May 15, 2008 by JonCris

[midge61]

hi JonCris

 

So how would a consumer who was sold one of these mortgages go about claiming it was sold under false pretences and getting it corrected?

[JonCris]

Hi

 

I think the many cases of mis selling PPI could be applied to this.

 

After all if you think about it it's a very similar scenario in that you may have been mis-sold the mortgage thinking one thing & as you were not told anything to the contrary, you have bought something that has no relation to what you thought

[midge61]

seems the FSA have just fallen short of accusing the involved firm of mis-selling.

FSA levies record sub-prime fine on Thinc

 

Rebecca O'Connor

 

The Financial Services Authority has levied a record £900,000 fine one of the country's biggest independent financial adviser groups for serious failures in selling sub-prime mortgages.

The watchdog said that Thinc Group, the mortgage broker, was guilty of poor record-keeping and failing to prove that the sub-prime loans it had sold were right for the customers who took them out.

The fine is the biggest ever imposed for sub-prime failings by the FSA since it began mortgage regulation in 2003. It comes almost a year after the FSA concluded its original investigation into the sub-prime market, when it referred five companies in total for enforcement.

The other four who have either faced smaller fines or who no longer have the right to sell sub-prime loans are The Loan Company, Next Generation, Homebuyers Security Ltd and Aidan Mortgage Consultants.

The clampdown follows warnings that the UK is in danger of its own US-style sub-prime crisis. Many borrowers with poor credit histories who took out sub-prime loans before they virtually disappeared following the credit crunch could now face much higher repayments when they come to remortgage, as the market has almost completely dried-up.

In the last few months, some brokers and lenders, who typically make more profit from the sale of sub-prime rather than prime mortgages, have been accused of selling sub-prime deals to borrowers who didn't need them.

While the FSA stopped short of accusing Thinc of mis-selling, it said that it was guilty of "failure to demonstrate" why customers' credit histories merited the sale of a sub prime mortgage; why a subprime deal matched those customers' needs and circumstances; and that it had taken taken into account whether the customer could afford the mortgage it recommended.

Margaret Cole, director of enforcement at the FSA, said: "The level of fine shows that we are determined to impose higher fines for serious failings in the retail market and that poor record keeping is a serious failing even where, as in this case, the FSA has not determined that the firm mis-sold sub prime mortgages and there have been few complaints."

Thinc, which will continue to trade subject to review by an independent third party, said that it "regrets" its failures and is undergoing a "comprehensive remedial plan addressing record-keeping processes, adviser training and vetting procedures for non-prime mortgages."

[midge61]

According to this it would seem that complaints should go to the FSA and that they should then act on them!

 

 

1. The FSA regulates the financial services industry and has four objectives under the Financial Services and Markets Act 2000: maintaining market confidence; promoting public understanding of the financial system; securing the appropriate degree of protection for consumers; and fighting financial crime.
   
2. The FSA aims to promote efficient, orderly and fair markets, help retail consumers achieve a fair deal and improve its business capability and effectiveness.
   

[Penfold92]

Taff,

 

I appreciate what you are saying and trying to do on this thread, however, the mortgage business is complicated. I am in no way saying some brokers have no scruples, BUT blaming your broker because you (the mortgagee whoever that is, not you personally) cannot now repay your mortgage is not the way forward.

 

If a mortgage was offered then the broker should be able to document and explain why it was offered, but a witch hunt will not help...For example we send out a product confirmation letter. This is not required by the FSA, but we feel it puts the mortgage advised and relevant issues in black and white before the mortgage has been taken out. Any misunderstandings etc can be sorted at that stage. Any complaints afterwards have an immeadiate starting point. Needless to say no complaints have arrived and about 99% of our clients come back to us.

 

I am a broker, as many on here will know, and have not tried to gain business from this site. I have offered some advice, where I could. I have my own issues and problems and I hope you understand that we are people too with families/ mortgages and even debts of our own.

 

The problem with the mortgage industry, as I see it, is that it was always over complicated and open to abuse, whether via self certs, fast tracking or simply by baffling the general public.

 

Try and explain to someone why they should be taking a 6.5% monthly mortgage payment instead of a 4.5% one? Does that mean because the rate is higher I have conned someone? No, there could have been a heafty arrangement fee with the lower rate that over the period of the deal would mean that pound for pound the client was better off with the higher rate. Or perhaps there was a longer tie in with a nice ERC!. The broker must act in the clients interest at that time that is what can be queried...

 

Luckily I was not around in mortgages in the 80's. But I do feel for brokers who have been hunted down 20 years later for selling endowments. At the time they were generally the right thing to use as a repayment due to the high interest rates and noone predicted the falling rate then, but that is not the case now. Was that bad advice to the client? Depends on what the client was told not the product...Does that make any sense?

 

As I said before this is a complex matter and cannot be simply explained away as good or bad advice. Each customer is different and has different credit histories/ needs and priorities.

 

I hope that helps give a little more insight into a very complicated debate and industry. I am happy to help or comment on general matters, but I will always say "speak to an independant mortgage advisor registered with the FSA face to face".

 

Penfold

[midge61]

hi Penfold

 

If you read through you will see that TaffR is in no way attacking mortgage brokers.

He is talking about the SPV situation. The fact that some of us who have taken out sub prime mortgages now find that we are unable to get any help or variation made to our mortgages because they are no longer in the hands of the mortgage company but are now part of a securatization package and "locked".

 

He has spent 4 years investigating this and the information he is providing is very interesting whilst also very disturbing.

[Guest TaffR]

Cheltenham & Gloucester v Norgan

[Guest TaffR]

http://www.consumeractiongroup.co.uk/forum/mortgages-secured-loans/142793-tilly-mortgage-express-repo-9.html

 

Also,if you manage to bring the arrears down to less than 2 months all possession proceedings MUST stop

 

I am not sure if this is true but I actually think it is considering the interviews in the past carried out with people...just cant remember that is all and how this applies to subprime mortgages (securitised)

[Penfold92]

Taff,

 

I appologise if I caught the wrong end of the stick, but you're right times are hard for us too and so on the defensive! Even prime mortgages are in trouble!

 

Abbey for example have just dropped all interest only mortgages to 50% loan to value only!

 

The thing that really gets to me is the whole Northern Rock situation....I was still selling their mortgages when they were begging the BOE for money! The FSA should have stepped in a long time ago and stopped them from lending. I am not saying administration or anything, but merely cease lending until they had recovered the funds they were missing. After all they were redeeming millions each day and where wa the money going? Back out to new loans....how they were allowed to get away with thatis unreal...

 

Penfold

[midge61]

Very powerful!

 

It will be interesting to see what sort of response you get to these e-mails.

[Guest TaffR]

Penfold, Sir,

 

You have absolutly nothing to apologise to me about. I fully understand where you came from and indeed in the most your right.

 

You know, as I do, there has been a huge increase in brokerage services, coinincendly, coinciding with the growth of the subprime market. You also know, I am sure there are so many that have 'dirtied' your proffessions due to this and other issues but I know so many good, decent and honest brokers out there who struggle and succeed in providing excellent services and advice to customers and sometimes that can take a lot of effort to explain the inticities of your advice.

 

This actually goes to my point.

 

The general public do not know about these things...hence they (we\me) depend on experts in this field.

 

The whole system and practice is highly dependant on what we do not know and at the bare minimum only to tell them what they are regulated too.

 

My real point is (and I have met them through friends and please be assured via over 100 mystery shopping trips) that there are brokers who know full well that these mortgages will be securitised, sold on, with a debt collector type type set up, that the mortgage is administration only, that they will repossess at the first moment of trouble etc etc etc... but do not tell the potential borrower.

 

Indeed they are so attracted by the commissions, the lunches, the holidays and meetings with head offices and service administration offices that they would indeed deny the potential borrower the real information so they do not get scared away.

 

I sat amongst 60+ brokers at the Mancheser Mortgage Show where, GMAC, KMC and others advised during a Q & A session that all they were interested in was equity and not affordability and most if not all cheered at this and at the announcment of increased commissions and free champaign.

 

All this 5 yards away from the FSA stand with them watching and listening.

 

Do I blame brokers? NO.

 

Everyone involved has to take some responsibility in this and that includes us (me) the borrowers. But, so much more could have been and should have been done even before the borrower was involved and I know for certainty there are bad borrowers as same as there are bad brokers.

 

I believe we are all responsible for our own decisions and I made a bad one, such is life and when this occures you expect to pay the price. However, had I been advised appropriatly, had I not been misled is such a very clever way, had I been provided with the even the basic information I have now...I would not have touched this with a brage pole or anything else. Indeed, its very apparent this sector could not exist nevermind thrive without this common deceit.

 

Real people with real families and with real lives pin their hopes, dreams on thier own judgements and those that advise them.

 

In brief... the whole secret set up, systems and processes are not so far from the loan sharks they were back in the 1980s and 1990's when Thatcher routed them out for due to their extortiante interests being applied and then low and behold they are back advising the newly formed FSA. (follow the careers of the Kensington Directors)!

 

Midge61 was spot on and Penfold, I do hope we can remain or indeed form a friendship and I would welcome you accepting my apologies for my post and bad spelling/typos.

 

Best wishes and regards,

 

TaffR

Edited May 15, 2008 by TaffR

[JonCris]

Penfold if you 'sell' a sub-prime mortgage without informing the buyer of it's likely affect should they default, namely that because of securitization they will be powerless to stop repo then you are as guilty of mis-selling as those who thought up the practice in the 1st place

[Guest TaffR]

Abbey by the way are at the top of repossession league in the prime market:)

[Guest TaffR]

JonCris, you make some very good and logical points. thank you.

[Guest TaffR]

Hi

 

I think the many cases of mis selling PPI could be applied to this.

 

After all if you think about it it's a very similar scenario in that you may have been mis-sold the mortgage thinking one thing & as you were not told anything to the contrary, you have bought something that has no relation to what you thought

 

Excactly....logical and to the point....sometimes I can't get there!!!!

[JonCris]

Taff there most certainly is chum You can't sell something which you know dependent on circumstances might have a disastrous affect on the buyer. particularly when selling in a market you know may fall prey to this affect. By anyones standards that's a foreseeable risk

 

It's no different than selling a car which you know privately if driven at over 70mph will fall apart thereby causing death & destruction to the occupants

 

The fact that the occupants 'broke' the law by exceeding the speed limit (defaulted) does not exonerate the dealer from blame

Edited May 15, 2008 by JonCris

[Guest TaffR]

interesting!!!

 

I think they sold a car for the main purpose and in the full knowledge that the purchaser will [highly probable] drive at 500mph!!!!

 

so where next?

Edited May 15, 2008 by TaffR

[Guest TaffR]

BBC NEWS | England | Norfolk | Father facing bailiffs found dead

[JonCris]

I agree & to continue the analogy they knew there was a 99% it would fall apart & injure or even kill the occupants & didn't give a toss

[Guest TaffR]

• Set up to fail - summaryl (pdf 84Kb)
  

 

• Set up to fail - summary (Welsh) (pdf 83Kb)
  

 

• Set up to fail - full report (pdf 396Kb)