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

[dun wi debtin]

Can someone tell me, please, does Clause 5(1) apply to mortgages?

 

UTCCR (Unfair Terms in Consumer Contracts Regulations) Clause 5(1) "A contractual term which has not been individually negotiated shall be regarded as unfair if, contrary to the requirement of good faith, it causes a significant imbalance in the parties’ rights and obligations arising under the contract, to the detriment of the consumer."

 

I would be interested to know. Thanks.

[eagleforms]

Hi dun. As far as I am aware, an unfair contract is an unfair contract, whether it is for a mortgage or buying milk from the milkman.

But, why not check it out with the CAB, they should have someone who knows.

[james_uk]

Surely it is about time that interest only mortgages are banned completely. If people cannot afford the repayments of the mortgage then surely the loan should not be granted?

[jansus]

not necessarily- if you wer on the bottom rung of the ladder it would give you the opportunity to afford a mortgage and you could always over pay or transfer to repayment when your salary increases.

 

Buy to let also use this method and then sell the properties to repay the mortgage.

 

and most interest only loans offer you the facility to over pay by 10% each month to reduce the debt.

 

the main problem is they require discipline and true explanation /understanding of the risks.

[eagleforms]

Don't forget that many interest only mortgages were sold as part of an endowment mortgage package, or pension linked, as was mine, and we all know how well most of the insurance policies performed.

[AnimalMagic]

Surely it is about time that interest only mortgages are banned completely. If people cannot afford the repayments of the mortgage then surely the loan should not be granted?

 

Absolutely not! I've had interest only mortgages all my house buying life and made a profit on every one. If you're buying a house for life, maybe the wrong option, but if you plan on moving on at a later date, then they can be very useful. Of course, as with any investment, you have to weigh up the risks.

 

And no, I'm not a mortgage broker, just a home owner...

[waja]

Interset only mortgage or not does the monet really exist!!!!!

[wishboneash]

any claiming from 2001

[saverjustice]

The answer is YES!

[maybelline]

yes it is but i keep on being advised that misselling is not a cause of action, can anyone explain this. what about the unfair terms regs or misrepresentation or fraud, are the latter cause of action criteria?

 

fos say cant help so whats out there for the poor punter who ended up with a dodgy product?????????????????????

 

yeah, repayment should mean more than less than 1% going to the capital part ???

[karenmariethomas]

We took out an interest only mortgage which was fixed at over 6.3% and at the time I had read that mortgages, 2.5 years ago, were going to plummet the following year. We discussed this with the advisor who insisted it was unlikely that rates would drop significantly, so we took her advise. We are not financial whizzkids and have to rely on the advice of the advisor who we assume has good knowledge of the market past, present and future. When the time came for renewal the advisor never got in touch as she had done previously . The interest rate reverted to base rate of 5.99%.Our bank asked us if we were interested in renewing the mortgage and so we went to discuss it further. However, the bank advisor pointed out to us that the mortgage has to be paid up in 4 years time! and what did we have in place to pay the mortgage off ??? needless to say we hadn't a clue what she was talking about! the original advisor never discussed this with us whatsoever. Now, husband has been made redundant and we can't renew the mortgage to one of the lower rates. We were definately mis-sold this mortgage based on our ignorance by an advisor who was just out to line her own pockets! Don't know if we can do anything about it though - any advice greatly appreciated

[dcahelp]

hey, I can only offer advice from my own experiences........... I am a layman, before any one asks....

 

We are currently suing our broker for selling us on.... basically we were with one company, two years later as promised we remortgaged to a better, but not fantastic rate, apying £4500 in brokers fees, come to find out later that he had sold us on to the same company, just they used a different name..... the broker still charged us to do this though, just to top it all off the broker and the conveyancing solicitor are no longer trading. We have confirmed with our solicitor that this is a no no and we are now in the process of suing theb broker. We cannot sue the lender as they just offered the funds and the mortgage rate......THEY THEMSELVES DO NOT OFFER ADVICE....... that is the job of the broker, under the advice if our broker we would not have had to pay the £4500 in fees...

[maybelline]

I agree, time to sue these lot!!!!!

[It's time]

2007 a broker approached myself at home & told me I could buy my council home & would be a great investment . One parent family on benefits I couldn't believe what he was saying but he said all the right things about ha.ving something to leave my children when I was no linger here so I agreed .. No mention of endowment or how I was gonna pay this mortgage out after the 25 yrs , I noticed the payment Swift where paying the broker & the fee I was being charged for his services & decided to pull out of the deal , the broker cut his fee in half & talked me into finalising the mortgage now 5 yrs on I'm gonna lose my home that I love & all because I trusted what I was being told from a "professional " who has since went into liquidation

[maybelline]

2007 a broker approached myself at home & told me I could buy my council home & would be a great investment . One parent family on benefits I couldn't believe what he was saying but he said all the right things about ha.ving something to leave my children when I was no linger here so I agreed .. No mention of endowment or how I was gonna pay this mortgage out after the 25 yrs ' date=' I noticed the payment Swift where paying the broker & the fee I was being charged for his services & decided to pull out of the deal , the broker cut his fee in half & talked me into finalising the mortgage now 5 yrs on I'm gonna lose my home that I love & all because I trusted what I was being told from a "professional " who has since went into liquidation [/quote']

 

Maybe check the FOS website. Is your product covered by FSA regulations. Have a read up on both these websites. I am not able to give legal advice, but, IMHO, such products are unfair.

 

good luck.

[gemspan]

Hearing this breaks my heart. How can anybody on benefits be considered for a mortgage. This has to be mis-selling...no doubt about it! I think a lot of people were caught out because here in the UK we are so keen on buying property...unlike in other European Countries. If you can give your details on the repossession forum I'm sure somebody could help you. So sorry to hear your story.

[maybelline]

http://www.oft.gov.uk/about-the-oft/legal-powers/legal/cca/CCA2006/unfair/unfair-rel-full/

 

this may point in some kind of helpful direction, I dont know if any of these case summaries are similar but have a look.

[maybelline]

2007 a broker approached myself at home & told me I could buy my council home & would be a great investment . One parent family on benefits I couldn't believe what he was saying but he said all the right things about ha.ving something to leave my children when I was no linger here so I agreed .. No mention of endowment or how I was gonna pay this mortgage out after the 25 yrs ' date=' I noticed the payment Swift where paying the broker & the fee I was being charged for his services & decided to pull out of the deal , the broker cut his fee in half & talked me into finalising the mortgage now 5 yrs on I'm gonna lose my home that I love & all because I trusted what I was being told from a "professional " who has since went into liquidation [/quote']

 

it is a steep learning curve for us consumers, for example, who ever heard of 'securitization' when wanting to purchase a property, or hedge funds, and so on, but the sub prime lending of usa, is IMHO why we are in this mess. brokers, introducers, whatever you want to call them, they are responsible for originating the mortgage and the lenders, along with the funds who securitize the loans for their investors, all wanted these loans, and as many folk signed up to them as possible, no matter what, because of the huge commissions they could get from them, it is the borrower who knew nothing of this intricate faulty relationship who are now being clobbered, dont believe any of this nonsense about moral arguments on the part of the borrower. you only have to search for the answer, use the web, buy a book on it. those in this business know full well what was going on.

 

http://www.cityam.com/forum/the-subprime-mortgage-crisis-isn-t-over-uk-taxpayers-remain-liable

 

just a random search brings up things like this, I am not advocating one view or another, examples only.

Edited September 22, 2012 by maybelline
additional info

[maybelline]

I might add, that there are threads all about this subject on here. They are a fascinating read and take a lot of brainpower to get through (or even for the ordinary folk to understand) it demonstrates to me that this is a huge and complex area not to be entered into lightly if thinking of any form of redress from lenders.

 

It is not my intention to lead others down a path that has been discussed at length already. I truly wish the best to all those who have been affected by subprime lending practices, whatever their driving factors.

[It's time]

Thanks for replies & slowly I'm learning more & more about how all this works .. Only a month ago I was asked about an endowment & hadn't a clue what it was & really maybe should had one attached to my mortgage .. Not that it would help me now . For a long time I've blamed myself for being stupid & getting myself into this mess , I don't have debt & never seen a mortgage as debt until now :-/ I'm concentrating on keeping myself right that I can't be classed as 'intentionally ' making myself homeless but I just seem to be not be able to do anything right

[maybelline]

if you are being repossessed, ring Shelter, they should be able to provide advice about homelessness options. I dont think the courts are supposed to give possession until all other options have been explored, including ways for you to pay the mortgage in the future. Shelter have specific help advice on these matters. do you know if you are entitled to Legal Aid at all? the CAB could help you find out, or use google legal aid calculator, put in your details to get a rough idea.

 

good luck

[maybelline]

I believe there are some stickys on the repo threads, maybe PM site team also.

[It's time]

Thank you for ur replies & thoughts , I am in touch with an organisation for help & advice , I have no way of maintaining the mortgage so a repro is definitely the out come .. I've accepted that but still makes me a little angry .

[Lea_HTH]

Thank you for ur replies & thoughts ' date=' I am in touch with an organisation for help & advice , I have no way of maintaining the mortgage so a repro is definitely the out come .. I've accepted that but still makes me a little angry .[/quote']

 

A possession is not the only outcome. If you are in touch with an organisation for help and advice, then one presumes they are exploring the possibility of mortgage rescue with you? Particularly since your property was a council property in the first place, the likelihood of them being able to purchase it back under MRS are quite good - depending on whether you meet the criteria. Phone the council and ask about MRS.

[It's time]

I am unaware if that is available in n.ireland it has not been mentioned to me . Mis selling of mortgage is being looked at .