Is it time to sue mortgages companies for mis-selling interest only mortgages?

[SergioAlmeida]

Oh dear God Chris, you really got out of bed the wrong side!

I would respond in full, but I think most people reading you're thread would realise what an idiot you are.

I only wish to respond to one thing. Mortgage brokers have a place in this world. Who else would be able to steer people throught the myriad of products out there and helping clients to choose the correct one. After all, if we were not about, all you would be left is branch based mortgage advisors, who can only ever advise on the products their particular bank can offer. That is not advice, that is just taking someone's order off a menu card.

You are such an idiot and I hope you get everything that is coming to you, ie repossession, as you cannot obviously control your own finances.

Good night.

[zither]

Oh dear God Chris, you really got out of bed the wrong side!

I would respond in full, but I think most people reading you're thread would realise what an idiot you are.

I only wish to respond to one thing. Mortgage brokers have a place in this world. Who else would be able to steer people throught the myriad of products out there and helping clients to choose the correct one. After all, if we were not about, all you would be left is branch based mortgage advisors, who can only ever advise on the products their particular bank can offer. That is not advice, that is just taking someone's order off a menu card.

You are such an idiot and I hope you get everything that is coming to you, ie repossession, as you cannot obviously control your own finances.

Good night.

 

Thats not very nice:p

[SergioAlmeida]

If you read what ChrisB wrote about me, think you'd understand my outrage, saying I am **** of the earth and hoping that I do not sleep at night. Firstly, he knows nothing about me, and at no point did I ever get personal with him. All I have ever given is my opinion, which, seeing as this is a free country, I am entitled to.

[Rooster-UK]

I suggest that posters on this thread spend some time reading the site rules, with reference to posting.

You will find a link to the Forum Rules in my signature.

 

If the bickering continues then I will close the thread.

 

The flame-war stops, NOW.

 

Rooster-UK.

[SergioAlmeida]

Like I said, I have not been personal with anyone until pushed.

[frettful38]

So any suggestions from anyone on what to do if they believe they have been mis-sold an interest only mortgage. What is the first step to take? Do you complain to the mortgage broker? Mortgage company? Or some other financial institution e.g F.O.S?

 

Would love to hear any views as I am in the same situation myself

[chrisb333]

Oh dear God Chris, you really got out of bed the wrong side!

I would respond in full, but I think most people reading you're thread would realise what an idiot you are.

I only wish to respond to one thing. Mortgage brokers have a place in this world. Who else would be able to steer people throught the myriad of products out there and helping clients to choose the correct one. After all, if we were not about, all you would be left is branch based mortgage advisors, who can only ever advise on the products their particular bank can offer. That is not advice, that is just taking someone's order off a menu card.

You are such an idiot and I hope you get everything that is coming to you, ie repossession, as you cannot obviously control your own finances.

Good night.

 

I don't know why the administrator is threatening to close this thread.

I think Sergo is merely highlighting what a lot of us believe to be correct.

That Mortgage brokers are only interested in one thing-Money!

 

I also hope you get what is coming to you, redundancy, followed by repossession, followed by, well, you can guess the rest. I might be a financial idiot, but I could never be as lonely and sad as you!

[eagleforms]

I have asked the FOS whether a complaint against the mortgage company who sold me the mortgage could be made. This was in July and I have heard nothing. In my case, though, it was about selling me a pension linked interest only mortgage where the pension lump sum was meant to pay off the mortgage. They failed to tell me that in those days, if I didn't have a job, I could not continue to contribute towards the pension. I was made redundant, so lost any means of paying back the mortgage except by selling the house. The mortgage ends in 18 months, so I have a real problem.

Perhaps the OFT is a route that could be looked at.

Chriss, mate, cool it. You're not doing your worthwhile cause any good by lambasting people. Brokers are a fact of life and most are doing a good job. I can understand your annoyance about finding out that sergio was a broker without him coming clean at the beginning and it did look like he was a mole. Whether he is or not is only for him to know and I suggest that if he is, he stays off this thread, if he isn't and has something worthwhile to say that will help us, then declare that interest and let us have the benefit of your experience.

[chrisb333]

Yes, you are right Eagle. I aplogise for my previous post. No-one should wish that type of disaster on anyone.

 

Check my other posts and you will see I have never had a go at anyone, just not like that. But when I see someone like Sergio on here, giving it the big sympathy vote, oh wow betide me, it makes my blood boil!

 

However, I hope the administrator bans him as I could do without it to be honest. I have enough on my plate without a "devil with an appication form", sorry, mortgage broker taking the **** out of me.

 

Anyway, I will behave now, honest.

[dun wi debtin]

Humm. Now then, now then.

 

My mortgage is interest only. It strikes me as a good deal. I just couldn't have afforded a repayment mortgage at the time I took out the loan. Still less could I afford a repayment mortgage now.

 

The mortgage has a few years to run and as I get to grips with my finances I am beginning to think about the time when the loan will expire. Frankly, it would be progress if I do not double the size of the loan between now and its expiry - I have doubled the loan once already since I took it on. More fool me!

 

I assume my mortgage terms and conditions are standard; it's a big enough lender for the terms and conditions to be standard. My question is regarding the interest rate 'collar' or as the lender calls it the 'marginal rate'.

 

A condition of the mortgage allowed the lender to increase the interest rate collar: "We may change the marginal rate by giving you 21 days notice."

 

This condition was invoked in September 2008 and the 'marginal rate' at which the Standard Variable Rate would thereafter be charged was raised from 2% to 3%. As a concession, if I was unhappy with their invoking the condition, I would not be charged the usual repayment penalty if I repaid the loan within two or three months. Thanks.

 

I know I signed up to the condition, indeed I spotted it when I read through the literature, but what option do I have but to sign? I assumed (possibly incorrectly) that this is a standard position adopted by the banks because of the unequal circumstances of the parties. It strikes me as an 'unfair condition' that abuses the inequality inherent in the relationship between a mortgage provider and an mortgagee.

 

Does anybody know, is there any challenge in process to this sort of arbitrary clause in favour of one party to a mortgage loan agreement?

 

There is, in theory, nothing to prevent the lender from invoking the clause again and again and again, which would, of course very quickly make all loans with this major lender impossible to repay. This really is just money for nothing as far as the bank is concerned!

 

I would be interested to challenge this sort of 'unfair' clause in mortgage agreements. Does anyone know if a challenge is in process already? The FSO couldn't comment on whether or not they were examining the issue.

Edited November 24, 2009 by dun wi debtin
added 2008

[zander]

The Mortgage Industry (Brokers, Consultants) is regulated more thoroughly than Brain Surgeons. Many lenders limit their interest only loans to below 60% loan to value and the question is always asked and highlighted in the Key Facts Illustration: "You will still owe ***** at the end of the mortgage term. You will need to make seperate arrangements to repay this". Moreover, another illustraion would be supplied to show the difference between I/O and Repayment. Interest only mortgages along with debt consolidation and capital raising, will be flagged up by compliance as high risk. It has to be proven that best advice was given before submitting to the lender.

Any good professional broker would run through the Key Facts with the customer to ensure it's fully understood before the client commits. Chrisb333 has obviously had a very bad experience with a mortgage broker and would seem to be tarring all others with the same brush. There are unscrupulous people in the industry as in many others, but they are getting caught and thrown out of the profession.

Endowments were the savings vehicle to repay the capital and these were sold by Financial Advisers. Mortgage Brokers are not qualified to advise on investment products. One final point on commission, if chris paid £1,700 for his advice then he was, possibly, being overcharged. The broker would have to have shown how he could charge such a high fee. If it was a difficult case, the broker would be putting in a lot of hours and that would/should be shown in a fees breakdown as proof to the FSA that the fee was justified. If he received a commission from the lender as well.... that's not treating the customer fairly in my, and the FSA's view.

If anyone is on interest only, if affordable change to repayment or alternatively overpay the capital outstanding every month. £1 a day can make a large dent in the balance (depending on how many years are left).

[eagleforms]

Zander

That's all very well and I am pleased that brokers have to comply with allthe regulations laid down by the FSA etc. However, in my case, there were not the same regulations as there are now, infact I don't think the FSA existed when I was pursuaded to take my interest only pension linked mortgage.In any case I did not use a broker, not many people did then. It became clear that the pension that had been set up to cover the laon was woefully inadequate and it had never been explained to me that should I lose my job, as many did in the early 1990's, then the pension died. I have asked the FOS if they will look into a claimof mis-selling the mortgage. That was in July and despite speaking to them a few times about it, I still have not had a reply. The pop-up that comes up on this site about the FOS, is pretty much right. We live in hopes that some day we will get an answer and it will be positive.

[zander]

Zander

That's all very well and I am pleased that brokers have to comply with allthe regulations laid down by the FSA etc. However, in my case, there were not the same regulations as there are now, infact I don't think the FSA existed when I was pursuaded to take my interest only pension linked mortgage.In any case I did not use a broker, not many people did then. It became clear that the pension that had been set up to cover the laon was woefully inadequate and it had never been explained to me that should I lose my job, as many did in the early 1990's, then the pension died. I have asked the FOS if they will look into a claimof mis-selling the mortgage. That was in July and despite speaking to them a few times about it, I still have not had a reply. The pop-up that comes up on this site about the FOS, is pretty much right. We live in hopes that some day we will get an answer and it will be positive.

 

Was it set up by a lender or financial adviser? Prior to regulation, in mortgages, it was a voluntary code so it was clear that regulation had to happen for the protection of consumers.

[eagleforms]

Set-up by Hill Samuel and then transferred to The Woolwich, now Barclays.

[eagleforms]

By the way Zander, are you another broker? You sound like you have vested interest in the trade.

[zander]

By the way Zander, are you another broker? You sound like you have vested interest in the trade.

 

Yes, Im in the industry as a mortgage professional.

[eagleforms]

What, like an architect or laywer? Qualifications to claim professionalism?

This thread seems to have attracted mortgage brokers, is there something they wish to put the lid on?

[zander]

What, like an architect or laywer? Qualifications to claim professionalism?

This thread seems to have attracted mortgage brokers, is there something they wish to put the lid on?

 

CeMap (certificate in mortgage advice & practice) CeRER (certificate in regulated equity release) I look at the threads to see if I can offer advice to those that require it. I thought that's what the forum was for?

[eagleforms]

Zander, it is to offer advice. Do you have any to give us?

[zander]

If I can help in any way then I would offer advice dependant upon the query.

[eagleforms]

Zander, several queries have already been posted here, can you offer some advice about them?

[zither]

Silence is deafening.

[eagleforms]

You can almost hear the tumbleweed rolling down the deserted street!

[jansus]

In reply to the original question - I think it would depend on the individual circumstances and the advice given.

 

I took out my interest only mortgage 4 years ago and was asked quite clearly - what will be your method of repaying the loan at the end of the term. My answer was sale of the house - we intended to stay here 10 years - improve the property then sall and move down market. I also had some ( useless) endowment policies. Therefore I had answered the question and had my plan. Therefore I do not consider the mortgae mis-sold.

 

However if someone is sold an interest only mortgage were the payment extend beyond retirement and there are no intentions to sell etc and the person is not asked the relevant question - then that is a different matter.

 

I dont expect the lender to spell out every eventuality - but on the other hand it be foolhardy IMO only not to check income and abilitity to repay the loan at some time in the future.

 

This previous thread of mine may be of interest.the principal of mis-selling can be applied to various situations.

 

http://www.consumeractiongroup.co.uk/forum/mortgages-secured-loans/191026-were-you-mis-sold.html

 

 

 

By the way I am an ex Halifax employee and try and help out on the possesions forum as I dont like the way a lot of borrowers are being treated - just to save any mis-understanding.

[eagleforms]

Thanks Jansus, at last some helpful input from someone from the "inside". As I have said, I am waiting for the FOS to give me a reply to my question to them some months ago and I will be reminding them about it next week. As you say, each case is different and depends on the advice given. I will let you know of the FOS answer, assuming that they ever give me one.