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Terrible Advice from a Mortgage Advisor - Do I pay?


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Hi Cag - I hope this is the correct place for the post of this kind!


I have a grievance with a mortgage advisor that has recently assisted with a house purchase. I was wondering if anyone could shed some light on what my rights are as a consumer and whether I should pay them as I’m of the opinion that the level of service doesn’t warrant any payment.


When my partner and I first approached the mortgage advisor, it was with the intention of buying a £167,500 house with a 5% deposit (£8375). My partner and I had no history of bad credit, both of our credit ratings were well above the UK national average and we both had well over £20,000 in savings within our stocks and shares trading account. The mortgage advisor immediately said the house would be affordable and suggested submitting an offer and requesting the house be taken off the market.


Below I have bullet pointed the reasons for my grievance:


·        Unsolicited documents sent to our home address from a 3rd party solicitor facilitated by the mortgage advisor


·        When instructed we would not use the 3rd party solicitor as they were to expensive, the mortgage advisor rang the Estate Agents suggesting that the solicitor that was being used was improper. The estate agents then rang my partner and I to see if they need to be worried and/or put the house back on the market. Luckily, the estate agent had worked with the chosen solicitor and were happy to proceed with the sale. I rang the mortgage advisor and requested that we proceed amicably with our chosen solicitor which was recommended by a friend and was much cheaper than the price quoted by their third party solicitor.


·        We then received advice by from the mortgage advisor to take out a bank loan to cover the cost of a 10% mortgage in order to preserve the savings that me and my partner have, with assurances that the mortgage would be more affordable and save us money in the long term with a bigger deposit. I was apprehensive at first but after assurances from the mortgage advisor that everything was fine and proceeded with the advice as I trusted them at this point.


·        I noticed a hard search appear on my Credit Report, when I questioned the mortgage advisor on this it was explained that the application was unsuccessful as my Quarterly Bonus payments had not been submitted. The mortgage advisor advised this was a mistake at the lenders side and that the quarterly bonus’ had been submitted by the mortgage advisor. I was instructed not to panic and the application was going to be submitted again with the Bonus payments on, the application was rejected again.


·        After a couple more hard searches were flagged on my credit report I rang to see how the application was progressing to be told that it was the last chance and if we were not successful this time then we would need to explore other options or lose the house. After that application failed again the mortgage advisor went back on her original advice, telling me to return the loan (which I had taken out 2 months previous, so returning the loan wasn’t an option) and take £16,000 out of our savings (a lot my savings had now been used to purchase furniture). Leaving us scrambling around trying to borrow money from relatives. When I expressed that I was upset and disappointed with the level of service provided the mortgage advisor suggested “Severing all ties”, I would have been happy to do this but I felt that we were in such a mess the mortgage advisor had guided us to the point of no return and feared losing the house if I had to start the process again with another advisor.


·        During this conversation the mortgage advisor stated that we were simply not affordable and they had searched with every different lender and no banks or societies would offer the money. I thought this odd with our previous good credit history so spoke with another mortgage advisor who stated straight away that only one lender in the UK accepts a loan as a deposit and that they can’t have checked with any other lenders as no other lender would accept the loan as a deposit (the loan was only take as per their advice).


·        Ultimately the mortgage application was successful and the only reason this was the case was because I had a significant pay increase of around 25% due to a recent promotion at work. This left me rushing to get the promotion approved at work in order to submit to the lender. Without this promotion we would have had no other option but to pull out of the house purchase. If the house purchase wasn’t affordable under my original circumstances, I believe the mortgage advisor should have stated this and advised much differently instead of trying to push through a purchase that wasn’t feasible, risking 2 peoples financial future and wasting the time of all the stakeholders involved in the deal.


·        Once the mortgage offer was sent through I was immediately asked for the payment of £499 for the services offered by the mortgage advisor. With raising this complaint formally in mind, I stalled on the payment until after the mortgage had cleared as I had received phone call from the mortgage advisor threatening to put the mortgage on hold. After speaking with the lender and my solicitor it was made clear to me that there was nothing the mortgage advisor could do to put the mortgage on hold.


There were other minor things said during the process by the mortgage advisor that put some strain on my relationship with my partner, for example she suggested that I may have spent the loan that she suggested I take out and that was the reason I couldn’t return it. The fact was the cooling off period had passed by the time I was told to return the loan.


With all this being said we got the offer from the lender which wasn’t favorable and with a higher interest rate than what was first quoted by the mortgage advisor.


I appreciate you taking the time to read through this situation, and I am grateful for any feedback and suggestions.


How should I proceed?


Can the mortgage advisor send private bailiffs to collect the money and can it effect my credit rating?



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You need to raise a complaint using the mortgage advisors stated complaints process.  Do so in writing and get proof of posting at the post office.  The mortgage advisors company has to have a complaints process as part of the regulations they come under.  You could then continue the complaint with the FOS.  


The mortgage advisors company could look to issue a County Court claim against you, issuing a a letter before action before doing so.  They can't send bailiffs unless there is a Court judgement allowing such enforcement.


If you have suffered any loss as a result of the mortgage advisors actions, you could also look to speak to Solicitors about issuing a Court claim yourself.  But if you did this, the FOS would not look into your complaint.

We could do with some help from you.



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Thank you for responding so quickly! 

Would communicating the complaint via email suffice?


I do believe we could have ended up with a better rate over the term of the mortgage with better advice. Unsure how successful this would be.


Are you able to provide any advice on the likely outcomes if i didn't pay the bill and/or raised a court claim?



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