HSBC 25 year mortgage about to end advice needed!

[sidley]

Long winded explanation.

 

Our mortgage of 25 years comes to an end towards the end of this year, when we will have to repay approx £100k

 

2 years ago our life endowment policy was ended by Phoenix Insurance (not originally with them but numerous acquisitions they ended up with it).

 

The reason for ending it

- they had had to use money from the pot to service the policy.

 

We complained

- they agreed that it had been mis-sold and they refund the difference between a standard life policy (life only) and the money we actually paid into the policy over 23 years with simple interest added. This came to just under £15k instead of the £80k

we were expecting to receive at maturity.

 

Not happy with that we complained to the FOS, who said we had a case.

Their decision was an extra £435 on top of the original offer.

 

They agreed that the policy had been mis-sold & mishandled (we had a riskier life policy rather then the standard endowment one), but that this was all we were entitled to.

 

We said we were not happy with that as we were going to use that money to pay off the bulk of the mortgage. The ombudsman said he would refer it higher up the chain but the result was the same.

 

He said we could go to court ourselves but the judge would take into account the FOS decision and the likelihood we would not win any substantial increase plus court/ legal costs - we would end up worse off.

 

After taking free legal advice, we felt gambling and losing more money was too risky so, we decided not to pursue court action.

 

now we have only £15k to pay towards the mortgage.

We will have to put a credible plan to the bank to reassure them that we will be able to pay off the mortgage very soon.

 

There is no delicate way of putting this, but I think you will need to know everything to be able to help me. I never thought I would be in this position.

 

The only thing that will enable us to pay off the mortgage is that my wife and I will soon inherit a substantial amount from our 3 remaining parents (all in their 90's).

I realise that this is described as a "potential asset" in the financial world and not an actual realised asset.

 

When my father died 11 years ago I inherited 1/2 his share of the house, with my sister the other half, which by todays assessment of the value of the parental house (minimum of £600k quick sale) is approx £150k for my share. k

 

This was frozen whilst my mother is alive or wants to continue living there.

He did this because my father was worried that my mother would live a long life (she has) and would need to go into a nursing home (she hasn't) and all of the money, if he left it to her, would go in nursing costs leaving my sister and me nothing.

 

After the turmoil of my fathers death, I was given a document from the family solicitor, stating the above, but over the years I don't know where it's gone.

 

I recently contacted his office which has been taken over by a bigger solicitor's firm asking for a copy but they said my mother is the client, not me, so they would need her permission. In my mothers present condition I do not want to worry her and so getting a copy is going to prove impossible.

 

My mother has a big house in the south coast.

She has had heart failure for 5 years (along with 3 different types of cancer).

Her heart failure was diagnosed in Oct.

last year as end stage with 6 - 12 months left to live.

 

My question is how should I approach the bank (HSBC) about the fact I cannot settle the mortgage straight away and I have an asset that is frozen at the moment?

 

Thanks in anticipation

Edited August 6, 2018 by dx100uk
Spacing

[ericsbrother]

ask the bank what they intend to do,

whether they will continue on an interest only basis or want a repayment mortgage (possibly not judging by your age)

 

a lot will depend upon what the value of your property is and also what your mother is likely to have put in her will.

 

A quarter of a house jointly owned with the RSPCA will be a nightmare to realise your share in a hurry for example.

Edited March 16, 2018 by dx100uk
spacing

[sidley]

Thank you ericsbrother,

 

Our own house is worth approx £350,000 (next door house was sold 7 years ago for £315,000) so the equity is just over 2/3 of the house.

We will also inherit from my father -in-law (97) at some point in the near future.

 

We have thought about downsizing, but with all our elderlies so old and frail we fear we will be balancing selling with dealing with 3 funerals!!

 

We already feel stressed out at the moment traveling 100s miles per week helping them out together with still holding down full time jobs.

 

Would it be advisable to stress this to the bank, to throw ourselves at their mercy so to speak?

 

Cheers

Edited March 16, 2018 by dx100uk
format

[theoldrouge]

First thing to do is to write to HSBC requesting an extension to your interest only mortgage , eg 5 years

 

Clearly set out your repayment strategy. HSBC will have to fully review your position

 

Although not required to extend

they must follow the FCA guidelines and treat you fairly and with forbearance

 

In practice this would amount to an extension of approximately 2 years anyway.

[sidley]

Thank you very much theoldrouge,

 

I will do that, as I think it's the best advice I've received so far.

 

Many thanks

 

sidley

[sidley]

Hi there,

 

After taking advice from this site I wrote to HSBC after 2 months of waiting I wrote to them again enc. copy of original letter. One month later all I've got is this reply.

 

Attached is what I received today. The letter is badly copied (faded) and there seems no personal response or empathy in their letter.

 

I think this is a standard letter of reply. Being a customer of theirs with accounts, and mortgage and having given them no problem over the years I expected to get something a bit more personal.

 

My question is what should I do now. They obviously want to extract as much money out of us as possible (re-mortgaging usually comes with valuations fees etc).

 

What do they mean by " we have been unable to agree to this request at this time" ? If I wait a bit longer they might agree to it?

 

I am not satisfied with their response, we are just another number to them, so do I respond and try and take things further up the ladder so to speak.

 

Many thanks

 

sidley

HSBC response1.pdf

[theoldrouge]

It seems as indicated above, that they are poorly attempting to follow the FCA guidelines

by indicating an extension of 24 months

It seems from your circumstances described that if you wish to avoid remortgage fees ,for now 24 months may be sufficient

 

I would reply that given the circumstances, of which you have informed them, you feel it would be reasonable for them to agree

a 24 month extension in line with the FCA guidelines

 

Should they refuse ,then escalate to a formal complaint

[theoldrouge]

For further reading

 

https://www.fca.org.uk/publication/thematic-reviews/tr18-1.pdf

[sidley]

Thank you oldrouge,

 

p.s. the link you have kindly posted does not seem to lead to anything!

 

 

 

cheers

 

sidley

Edited July 10, 2018 by Andyorch
Edited

[sidley]

The circumstances haven't changed, indeed my poor mother is getting much worse with not long to go.

 

They have indicated a 24 month extension, reserved for those with an equity plan that may be out of sync with the mortgage, but it seems not to apply in my case.

 

24 months will be more than sufficient in my case. Since all of our local branch closures, they seem to have lost what little human touch they had.

 

cheers

 

sidley

[AndyOrch]

http://www.thisismoney.co.uk/money/mortgageshome/article-2296532/HSBC-axes-mortgages-unless-richest-customers.html

[theoldrouge]

Thank you oldrouge,

 

p.s. the link you have kindly posted does not seem to lead to anything!

 

 

 

cheers

 

 

 

sidley

 

Yes link seems dead. Google FCA interest only mortgages thematic review TR18/1

[sidley]

Thank you again oldrouge.

 

Cheers

 

sidley

[sidley]

Thank you andyorch.

 

Cheers

 

sidley

[sidley]

Hi there,

 

Unfortunately, HSBC seem to be refusing to answer any of our letters (despite reminders) the one posted above is the only one received to date.

 

I have sent the last 2 recorded delivery, but still no success this is despite numerous letters from HSBC to mortgage holders who are coming to an end reminding us that the mortgage is coming to a close and to contact them if you are in difficulties.

 

They are just not engaging with us in any way!

 

What do you think I should do now?

 

Thanks for all your help

 

sidley

[ericsbrother]

look up institutions that will do you an interest only mortgage or a lifetime mortgage and tarnsfer there. many banks have realised that there are a number of people in your situation with a decent bit of equity in a property but no way of settling a mortgage

[sidley]

Thanks ericsbrother for your help,

 

I do have a way of settling the mortgage but not at this moment. Hence my desire to extend the current mortgage for 24 months which would be more than ample.

 

cheers

 

sidley

[dx100uk]

https://www.consumeractiongroup.co.uk/forum/showthread.php?488944-Interest-only-mortgages-lasting-into-retirement-launched-by-building-society

[sidley]

Thank you dx100uk,

 

I will mention that to HSBC, but they advertise that they are willing to engage with people who will have difficulty paying off the capital but they don't seem to be living up to their promise!

 

sidley

[Old Cogger]

Thank you dx100uk,

 

I will mention that to HSBC, but they advertise that they are willing to engage with people who will have difficulty paying off the capital but they don't seem to be living up to their promise!

 

sidley

 

 

As you are finding out as many of us have over the years, they seem to think they are above regulation etc

[theoldrouge]

Hi there,

 

Unfortunately, HSBC seem to be refusing to answer any of our letters (despite reminders) the one posted above is the only one received to date.

 

I have sent the last 2 recorded delivery, but still no success this is despite numerous letters from HSBC to mortgage holders who are coming to an end reminding us that the mortgage is coming to a close and to contact them if you are in difficulties.

 

They are just not engaging with us in any way!

 

What do you think I should do now?

 

Thanks for all your help

 

sidley

 

 

Formal written complaint to HSBC, and off to the FOS if they refuse or ignore

[sidley]

Cheers oldrouge,

 

It's been 4 weeks since my last recorded delivery reminder to them about the absence of any response so far.

 

Can I ask you how long I should wait?

 

cheers

 

sidley

[sidley]

Cheers old cogger,

 

Yes I am beginning to find out that despite their promises they just don't seem to care!

 

I will soon write a letter of formal complaint to them and if no luck take it to the FOS. I've heard good and bad stories about the FOS, so I hope it will be a good one for me.

[AndyOrch]

Cheers oldrouge,

 

It's been 4 weeks since my last recorded delivery reminder to them about the absence of any response so far.

 

Can I ask you how long I should wait?

 

cheers

 

sidley

 

Well you have been waiting 6 months already Sid...and the clocks a ticking...why not consider the link provided by DX....with regards to Lifetime Mortgages there is an early settlement fee which can be quite considerable...so only consider that if its suitable and you wish to free up your equity.

 

 

Andy

[theoldrouge]

Get the formal complaint off asap

Incorporate the FCA guidance and fully set out your case

Bear in mind they have to follow the guidelines

which plainly they are not in your case

 

https://www.fca.org.uk/publication/finalised-guidance/fg13-07.pdf

 

If link not working Google FCA interest only mortgages

Use para 3.5