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FCA says 750,000 mortgage customers could get compensation payout

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A potential blunder by lenders means thousands could be in line for compensation, the Financial Conduct Authority says.

 

 

 

Hundreds of thousands of mortgage customers could be in line for compensation.

 

The Financial Conduct Authority (FCA) said its work with an industry group had identified a "likely" breach of industry rules.

 

The watchdog said it believed lenders had been collecting arrears over the remaining mortgage term through a higher monthly payment while continuing to pursue the money as immediately payable through their collections processes.

 

It believes around 750,000 customers may be affected by the issue of lenders automatically lumping arrears balances in with customers' monthly mortgage payments.

 

 

http://news.sky.com/story/fca-says-750000-mortgage-customers-could-net-compensation-payout-10623570

 

I dont think this is or was a blunder - it was a deliberate action by the mortgage companies.


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Interesting information. Please can you explain what it actually means to a simpleton like me, or what it is that a company may have done. I do hope GE money falls into this category! Probably wishful thinking on my behalf!

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Interesting information. Please can you explain what it actually means to a simpleton like me, or what it is that a company may have done. I do hope GE money falls into this category! Probably wishful thinking on my behalf!

 

 

I will try to explain, although I find it quite confusing myself.

 

 

Say I had a mortgage with Grabitback bank - for whatever reason, I had arrears that went past their permitted arrears limit. I have offered to repay it a £x amount per month on top of my usual monthly payment. They say no - we want to capitalise the arrears.. "add it to the end of the mortgage" (which is essentially lending you more money).

 

 

You agree to this - so your monthly repayment SHOULD stay the same with no extra for the arrears.

 

 

However, the banks would capitalise the sums and still send the arrears amount to a debt collection agency - or even keep it in house to pursue you for something that you have already agreed to repay at the end of the original mortgage term !

 

 

Hope that makes sense.


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2: Does your Bank play fair - You can force your Bank to play Fair with you

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5: Fair Treatment for Credit Card Holders and Borrowers - COBS

 

 

 

Advice & opinions given by citizenb are personal, are not endorsed by Consumer Action Group or Bank Action Group, and are offered informally, without prejudice & without liability. Your decisions and actions are your own, and should you be in any doubt, you are advised to seek the opinion of a qualified professional.

 

PLEASE DO NOT ASK ME TO GIVE ADVICE BY PM - IF YOU PROVIDE A LINK TO YOUR THREAD THEN I WILL BE HAPPY TO OFFER ADVICE THERE:D

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GE Money is a sub prime lender, so I am not sure whether or not they have been caught up in this - IMHO, they should be as they have lent money for a mortgage.


Have we helped you ...?         Please Donate button to the Consumer Action Group

 

Uploading documents to CAG ** Instructions **

 

Looking for a draft letter? Use the CAG Library

Dealing with Customer Service Departments? - read the CAG Guide first

 

1: Making a PPI claim ? - Q & A's and spreadsheets for single premium policy -

HERE

2: Take back control of your finances -

Debt Diaries

3: Feel Bullied by Creditors or Debt Collectors?

Read Here

4: Staying Calm About Debt

Read Here

5: Forum rules - These have been updated -

Please Read

 

 

BCOBS

 

2: Does your Bank play fair - You can force your Bank to play Fair with you

3: Banking Conduct of Business Regulations - The Hidden Rules

4: BCOBS and Unfair Treatment - Common Examples of Banks Behaving Badly

5: Fair Treatment for Credit Card Holders and Borrowers - COBS

 

 

 

Advice & opinions given by citizenb are personal, are not endorsed by Consumer Action Group or Bank Action Group, and are offered informally, without prejudice & without liability. Your decisions and actions are your own, and should you be in any doubt, you are advised to seek the opinion of a qualified professional.

 

PLEASE DO NOT ASK ME TO GIVE ADVICE BY PM - IF YOU PROVIDE A LINK TO YOUR THREAD THEN I WILL BE HAPPY TO OFFER ADVICE THERE:D

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Thank you CitizenB, yes a little clearer.....i think

 

I don't think i will fall under this as i did pay extra money for arrears on top of the normal installment but they did not capitalise.

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