Mortgage obtained under duress

[dawny36]

Hi everyone

 

I have been recommended to your site as i need to know my mothers rights regarding a mortgage that she has on her home. Its a long and drawn out situation and i shall try to condense this as much as i can so if you can bear with me i would be very grateful.

 

My mother met her ex partner in feb 2007. Little known to her at the time he was an extremely violent man. He asked to move in with her almost straight away and my mother thinking that this might have been her last chance of happiness agreed as he seemed a very nice guy initally. The year that followed resulted in this man being arrested 3 times for Criminal Damage, Battery and GBH which he was paroled for and given community serivce which he refused to do.. During the year that they were together he threatened her life on numerous occasions and that of mine quite graphically if she refused to give him her credit cards. He was also arrested and charged for stealing her cashpoint card and taking money out of her account. Eventually he was sent to prison for 14 months in Februrary 2010 stalking and harrasment.

 

Her ex partner left her in horrendous debt and severly depressed and as a consequence she tired to commit suicide in Feb 08.

 

I spoke to all my mothers creditiors 9 in total with debts spanning 24K. I also spoke to my local MP who helped me speak to the creditors. One by one after sending supporting documentation each of her creditors, letters from doctors, hospital discharge notice and her agreement that they could access the police statements, they wiped out the debt due to the circumstances in which the debts were obtained.

 

In June 2008 my mother was forced to obtain a mortgage of 78K on her home which she owned outright by her ex partner. The money was paid into her account and he subsequently took it under threats of violence and that he would take her life.

 

My mother earns 10K per annum. Shes a dinner lady. At the time of the mortgage being taken out my mother was 57 years old. It was a fixed rate mortgage i think of about 5.6% for 5 years. The thing that i am extreamly concerened about is the fact that she never met any one regarding this mortgage. When i asked her how she got it she said that she was put in touch with this broker that phoned her and sent her paperwork through the post. Four weeks later she had the money paid into her account. The only thing that she can remember is that this broker told her that she must not tell anyone that they hadnt met. Also at the time she was being treated for depression and would have agreed to anything as she was so frightened.

 

After dealing with all of my mothers creditiors i have now decided to deal with this one if i can. I sent them a letter and asked if i could speak to someone in authority regarding my mums mortgage. They sent me a letter back giving me the name of someone in customer service. I called this woman and asked her how my mum was given this mortgage on the basis of her age, her wage, (10k) and more importantly on the basis that she had never even met with anyone about it. The woman told me that on the forms it said she earnt 16k per annum and the mortgage had been fast tracked so thats why no one met her????

 

Im sure this isnt right but im scared that if i challenge them on this they could call my mums mortgage in and force her to sell.

 

Im sorry this has been so long winded but i thought it was important for you to know the background as well as the current situation.

 

I would be really grateful for any advice you may able to give me on this as i really dont know what im doing. My mothers home is all she has and she is terribly insecure that she will lose it. Currently i am paying the mortgage.

 

Thank you for your patience.

 

Dawn

[dawny36]

I have just been readin this thread and i wanted to mention , if it helps that my mum paid this broker i think £650.00 for her to get the mortgage. Does this make any difference?

 

 

 

 

http://www.consumeractiongroup.co.uk/forum/mortgages-secured-loans/176310-my-firstplus-secured-loan.html

[dawny36]

The more im looking thought all the other threads the more i think that this mortgage may have been missold.

 

Help !

[frettful38]

Hi dawny36 have a read of this and hope it is of some help.

 

How do I know if you have been mis-sold to you.?

 

There are many grounds on which you can claim your mortgage has been mis-sold to you. The crux of any claim will be that you were misadvised by whoever arranged your mortgage, i.e. a broker, IFA or bank. Listed below are some of the most common instances where mortgage mis-selling may have occurred. If you feel you may have been mis-sold for a different reason then speak to your local Citizen's Advice Bureau to see if you have valid grounds for a claim.

You were not properly assessed to check that you could afford the monthly payments.

You were sold a mortgage while you were on benefits.

You were told everything good about the product but not given any information about what would happen when interest rates go up.

You were pressured by the broker into falsifying details such as your income in order for the application to be approved.

The mortgage runs past retirement age.

Your situation was wrongly assessed.

You were advised to switch to another lender without being told of all the fees and penalty charges that would actually make you worse off.

The commission paid to the broker by the lender was not explained to you.

You were a council tenant who was advised to buy your council house without the lender undertaking an adequate assessment of your financial situation.

You were advised to take out a self-certification (self-cert) mortgage even though you are not self-employed, so that you could borrow more.

You had to pay the broker a separate fee which was a percentage of the loan.

Your mortgage was within subprime borrowing or fell under adverse credit.

Your mortgage is an endowment mortgage and you were not warned of the risks involved, how your premiums would be invested and advised that it was a long-term investment vehicle.

If you are sure that you were mis-sold your mortgage the next step is to take your complaint to your broker.

 

 

Taking your mis-sold mortgage claim to your broker

 

Before you can take your claim to the Financial Ombudsman Service you must first exhaust your broker's complaint process. This involves writing to your broker, be it an intermediary, an IFA, or a bank, with your complaint until it's clear that no reasonable settlement is going to be made.

Before making an official complaint to your broker it is advisable to gather evidence to prove that the broker advised you incorrectly and mis-selling occurred.

The FSA rules state that the broker "must make and retain a record" of the mortgage being suitable for you. In other words, the broker must prove that they advised you correctly and followed all procedures in determining whether the mortgage was suitable for you or not.

Request these records from your broker, quoting Section 4.7 of the MCOB. Ask them to show copies of all the advice given to you and to prove that they carried out a full income/expenditure assessment or a fact find. It was their job to make you aware of exactly what you would be paying and to tell you if you could realistically afford the mortgage or not. If they cannot prove that they gave you full and accurate advice then you will have strong grounds for a claim.

 

 

Once you are clear on how the broker's bad advice led you into paying for an unaffordable and inappropriate mortgage then put your complaint to them clearly explaining the following:

How your mortgage was mis-sold and how the broker's advice was misleading.

What situation this has left you in (e.g. arrears, risk of repossession).

What you would like for the broker to do to remedy the situation e.g. end the mortgage and facilitate a move to a more suitable mortgage while compensating you for the extra costs, refund all arrears fees.

It will probably be the case that the broker flatly denies all allegations of mis-selling. Do not give up there, however, as you will now be able to forward your claim to the Financial Ombudsman Service for an independent review.

 

 

Escalating your mis-sold mortgage complaint

 

Forwarding your claim to the Financial Ombudsman Service

 

If no reasonable solution has been reached after following your broker's complaint process you may forward your case to the Financial Ombudsman Service.

The fos is an independent body set up by the government to resolve disputes between financial companies and their customers and is free to use.

Gather all the previous correspondence relating to your complaint and follow the procedure on the fos website. They will review your case independently and if they rule in your favour, your broker will be obliged to compensate you.

If after all this you are still unsatisfied or if you are in any doubt at any stage please always consider taking independent legal advice from a solicitor who can advise you in more detail.

[dawny36]

I did last night but thanks for posting it again for me.

 

I guess im a bit of a nervous nerris on this one. I dont want to cause waves and they say that the mortagage shouldnt of been given to her and they call it in but there is something not right about the set up of it all.

 

If i start looking into and a make a complaint about the broker and the concerns i have over the mortgage can they make her sell to get their money back?

 

And does anyone know of any case at all where a mortgage was missold and the mortgage was written off? Im finding it a hard to find any similar cases to compare mums with.

[dawny36]

OK so ive re read your post frettful and these are the points that i can confirm:-

 

You were not properly assessed to check that you could afford the monthly payments. I would say that this is correct based on the fact that the mortgage payments are £400.00 and Mum earns £800.00 per month. I am amazed that the mortgage company didnt turn her down after seeing proof of earnings unless they didnt.

You were sold a mortgage while you were on benefits. No

You were told everything good about the product but not given any information about what would happen when interest rates go up.My mother doesnt even understand what interest rates are. In fact this is an interest only mortgage and she was horrified to know that after paying off 15K that none of the capital has been touched.

You were pressured by the broker into falsifying details such as your income in order for the application to be approved. Well it seems that the mortage company are under the impression that she earns £16,000.00 per annum but im still mistyfied as to how they came to this conclusion and the fact that her P60 would have said different.

The mortgage runs past retirement age. My mum will be 62 when the 5 year mortgage term is over.

Your situation was wrongly assessed. My mother works as a dinner lady earning near on minimum wage. She was in a state of depression after a failed suicide attempt and was forced to obtain this mortgage under duress from her partner. I would say that if a decent broker met her they wouldnt have given her a mortgage in a million years.

You were advised to switch to another lender without being told of all the fees and penalty charges that would actually make you worse off. N/A

The commission paid to the broker by the lender was not explained to you. I dont understand this one myself. She paid £650.00 approx to the broker. Im not sure if it was taken out of the mortgage or she sent her a cheque.ls there anyway i can find out?

 

You were a council tenant who was advised to buy your council house without the lender undertaking an adequate assessment of your financial situation. No.

You were advised to take out a self-certification (self-cert) mortgage even though you are not self-employed, so that you could borrow more. No, but she may have been advised to lie about her salary hence the mortgage company saying that they are under the impression she earns £16,000.00.

You had to pay the broker a separate fee which was a percentage of the loan. Again i know she was chartged this fee by the broker which the broker even asked for in cheque form or was taken out of the money depositied into her account.

Your mortgage was within subprime borrowing or fell under adverse credit. My mother owed a fortune on her credit cards, approx £24K and hadnt made a payment for months when she took out this mortgage.

Your mortgage is an endowment mortgage and you were not warned of the risks involved, how your premiums would be invested and advised that it was a long-term investment vehicle. I dont think so.

 

Also just in closing my mother keeps going on about the fact that the mortgage broker kept telling her that she must say that they hadnt met. When i did make intial enquires with the mortage company about why she has never met anone in person to discuss this mortgage they explained that she didnt have to because it was fast tracked? Does anyone know what this means?

 

Thanks for helping me

 

D xxxx

[Guest Mrs Hobbit]

I would say the broker might have done something naughty and was supposed to meet with you Mother.

 

What a mess, you tackle the Broker and start the complaint process, exhaust that, remember his licence will be at stake so he is going to duck and dodge, make sure everything is writing and sent recorded delivery, this you need proof of when you start the FOS process. You also notify the FSA because the broker is or should be registered with them.

 

You can bet also there was a commission paid to the broker by the Mortgage Company. The other thing is this a sub-prime mortgage? What company is it with?

[dawny36]

I dont know who the broker is and my mother cant remember either. Will the mortgage company have her name and contact details? My mum only had her name and telephone number as she was referred to her by someone she used to know.

 

Im also not sure if this was a sub prime mortgage, how can I find that out. Its with Skiptons Building Society.

 

So am i going after the broker or the mortgage company?

[Guest Mrs Hobbit]

Mortgage Broker first and then after FOS, Skipton.

 

DPA SAR Skipton for all the documentation including, the underwriting notes provided by the mortgage broker this way you will have all you need. Not a bad idea to also ask for th any and all telephone recordings made pertaining to this application. if there are any, Skipton does have to provide these under the DPA SAR. it will cost you £10.00 and you have to allow 42 days for the provision of same. This will give you all the Broker's details.

 

If you have her name and telephone number do a check through the FSA

[dawny36]

Thankyou

 

They wont get funny with me will they for asking for this stuff?

 

Also do you think that they might have her name and telephone number or should that be documented in the SAR?

 

Finally what do i do if i cant find this mortgage broker?

[Guest Mrs Hobbit]

They have to supply according law, this why you use the DPA SAR. All the documention willhave this information. there is a template letter in the Library, adapt it and include the bits of extra documentation I have mentioned. if you need help with the adaptation of the request letter someone will be along to help you draft it up. the Mortgage broker will be found...otherwise Skipton will be in deep doo doo and have to explain their actions. it is so important to get the underwriting notes, this way you will see what the underwriters have written regarding the application and recommendations regarding the granting of the mortgage.

[dawny36]

Thank you

 

So first things first. Before i send them any kind of letter i need to find out the facts starting with the SAR?

[Guest Mrs Hobbit]

You need to send the DPA SAR to Skipton first. This is the Subject Access request using the Data Protection Act. Once you have this data, you can then sort through the paperwork and see what you can find out about the broker. Using the SAR you need copies of all telephone recordings they hold regardign this mortgage. DPA SAR will have to be in your mother's name and under her signature.

 

In the meantime if you diakl the phone nunmber provided to your mother from the Broker you should be able to eleicit who, and where this person is located. If you can get this there nothng wrong starting the complaints procedure with this person before going to the FOS. If you have the infomration nothing wrong with a letter to the FSA to check the Licence number of this person.

[dawny36]

Thanks Mrs Hobbit

 

I will search for the broker information but im not holding out alot of hope on that one so hopefully the building society will have that information.

 

Ill send the SAR and get back to you with whatever it turns up.

 

Once again thanks for taking the time and also Frettful38 with me and giving me a starting point

Edited June 15, 2010 by dawny36

[kilkenny]

Is this not a case of undue influence. Have a look at the case of Wright -v- Cherrytree Finance it might help?

[dawny36]

Thank you for that little Gem!!! Ive been searching for cases that were similar to my mums so im over the moon with that. Thank you

[kilkenny]

I'm no expert but it sounds familier to your situation - can you get legal advice? I am in a similar position and can't. I think the mortgage company giving your Mum the mortgage must have had notice of undue influence my only concern is that her partner was not party to the mortgage.

[rocket1]

Kilkenny

 

Where can I find details of the Wright -v- Cherrytree Finance case ?

 

Googling it doesn't help at all.

[kilkenny]

Hi, I found it on this site which gives judgements from high court case. The website is www.bailli.org. Just search for Wright-v-Cherrytree Finance. Hope it helps.

[Helplessconsumer]

Kilkenny,

 

I can't make head or tail of that site. I have tried numerous ways of searching but nothing makes particular sense. It's all sort of random and vaguely meaningless - like most of the rest of the internet really.

 

Just a bit worse !

[Guest Mrs Hobbit]

PLC - Mortgage is unenforceable because of undue influence from son-in-law=

 

http://www.ucc.ie/law/restitution/archive/englcases/wright.htm

Edited July 6, 2010 by Mrs Hobbit

[Helplessconsumer]

Mrs Hobbit,

 

Thank you very much for your help in finding that for me.

 

It is a fascinating judgement and I am wondering if it might help in bringing an action in a typical sub-prime mortgage situation.

 

i.e. sub-prime borrowers were misled at every stage of the process and 'undue influence' was placed on them by brokers/lenders (in various, myriad ways).

 

In a general sense, huge numbers of sub-prime borrowers were deliberately forced by a venal mortgage supply industry into high profit sub-prime mortgages by a carefully constructed system of artifice under the sanctimonious guise of establishing 'creditworthyness' and 'risk' which was an empty, almost entirely meaningless artifice to make the maximum amount of money out of homeowners.

 

And in order to achieve this, brokers and lenders actively misled borrowers to a great or lesser degree and many of the points raised in that judgement would apply to many sub-prime mortgages.

 

What do you think ?

[smouncher]

There are a number of parties who had an obligation to make sure your mother was treated fairly.

 

One that you all seem to have missed is the solicitor who completed the conveyance. They have fairly strict rules as they are governed by the SRA.

 

You would obviously need legal advice to ascertain if they have failed to meet the standards required.

[Guest Mrs Hobbit]

I would hope the solicitor who did the converyancing would do the correct thing, but in my experience, it has been the paralegal who did the work and the solicitor was just the signatory. Cynical yes, but true.

[dawny36]

Right finally they have sent me something, its the application form together with the Title information document that they hold on file. The salary state is £17,000.00 , my mum earns £9,000.00 and is now on tax credits. It is ticked on the form that no supporting documentation to back up the fact that she earnt that amount of money has been sent. She never saw a solicitor. There is also an FSA reference number but im not sure if that is for the broker or the mortgage company.There is paperwork on file for a company called Conveyancing Direct solicitors showing detals of completeled registration etc.

 

What should i be looking for here? As i said the mortgage was obtained under sever duress, the ex partner finally being imprisoned for the violence perpetuated against my mother and no one at anytime came and saw my mum, it was all done over the telephone.

 

Thanks everyone. I do appreciate your help here

 

Dawny x