Just when we thought mis-sold Payment Protection Insurance (PPI) was enough, there seems to be a new kid on the block, mis-sold mortgages.
Since the big bang of the 1990's brokers and sub-prime lenders spring up everywhere pushing mortgage and secured loan products to those people with less than perfect credit. These products tended to carry higher interest rates, higher charges and also paid large commissions to the salesman - great for them, not good for the consumer!
The Financial Services Authority now has broker sold mortgages in their signs and claims management companies are hot on their tails for the big thing.
However, if like many people you have a mortgage, it is important you understand the various regulations laid down by the Financial Services Authority to check whether you have been mis-sold, as simply being upset at your interest-only endowment not paying out enough to cover your shortfall is not enough grounds on its own.
In short, a mortgage is said to be mis-sold if it was not sold in the right manner. This could be because you received a product that was not suitable or you received the wrong advice from the lender. This is the starting point for the Financial Services Authority who are now allowing people to make claims in certain areas. The following are guidelines to enable to determine whether you have a mis-sold mortgage.
Reasons Why Mortgages are Mis-sold
There are various reasons why mortgages are usually mis-sold. In most cases, brokers or lenders will mis-sell a mortgage in order to make more money without considering the customers circumstances. In many cases, brokers only had access to certain lenders products offer limited mortgage products. There are known as "tied brokers". This is a good indication that they were not best in the market and were therefore unable to offer you the right mortgage that suited your circumstances
How Tell That Your Mortgage Was Mis-sold
There are many ways you can tell if your mortgage was mis-sold or not. Here are some of the major reasons that may indicate a mis-sold mortgage:
- If you were or are unable to meet your mortgage payments and your adviser did not carry out checks as to your affordability.
-You were or are still paying for your mortgage after retirement and there are no systems in place to keep up the repayments.
- You started with a fixed term product and you were never informed about an increase in repayments after the fixed term ended.
- Where you are re-mortgaged to clear existing debts, but you were unaware about repaying more interest than you originally needed to.
-You were sold a subprime mortgage and you had no previous credit problems.
-The sales advisor recommended a certain mortgage without checking your financial circumstances or you never needed such as sub-prime mortgage with a higher interest rate.
One of the major reasons mis-sold mortgages came about was due to many brokers and lenders do not assess their customers circumstances well. This leads to poor advice which consequently results to poor mortgages being offered and leaving customers in poor financial situation.
Are You Entitled To a Compensation?
If you find yourself having problems paying your mortgage, did not get the best deal or you feel that your broker did not abide with the Financial Services Authority laws, then you may file a claim. If you win, you should receive compensation equal to the equivalent of what you have paid, against what you would have paid if you had the correct advice in the first place.
How To Make Your Claim
In order to file your claim, you will have to consult a reputable claim management company to apply a Subject Access Request (SAR). This allows them to obtain all the documentation relating to you mortgage. After receiving the documents, the company will then submit a complaint to your lender or broker. Times can vary from weeks to months, on average about 20 weeks should be expected. In some instances the mortgage broker may reject the claim. However, if it is established that the claim was wrongly rejected, the claims company will take the claim directly to the Financial Services Authority. The process may take a further 6-12 months.
However, nothing ventured, nothing gained and always hope for a favourable ruling.
To get a FREE mortgage assessment contact Claimline Legal http://www.missoldmortgagesclaim.co.uk