Did your lender discuss how you’d repay your interest only mortgage?
Did they advise you to re-mortgage to consolidate debt?
Did you pay very high fees?
There are many reasons why lenders and brokers are now being asked questions about who they gave mortgages to and why.
If you can relate to any one of these points – you may have been mis-sold your mortgage?
- Were you advised to buy an Endowment policy?
If you were advised to get an interest only mortgage and an endowment policy to go with it, you may have now discovered that the endowment won’t pay out enough to cover the amount you borrowed. You may have been mis-sold.
- Did you get an interest-only mortgage?
If you were advised to get an interest only mortgage, you should also have been advised to how to repay your mortgage after the term of your loan. You should also have been made aware of the difference between the costs of a capital and a repayment mortgage, or that you may have to switch to a repayment mortgage and not rely on increasing house prices. If not, you may have been mis-sold.
- Did you re-mortgage to clear debts?
If you were advised that the cheapest way to consolidate your debts (unsecured loans, credit cards or other finance) onto your mortgage, you may have been mis-sold. The adviser should have explained that while you may have more affordable outgoings, you would be repaying for longer and also paying a lot more in interest.
- Did you complete a household budget analysis?
Were you asked to outline your monthly income and outgoings? Did your advisor work out how much money you have left over at the end of the month? If you didn’t, you may have been mis-sold a mortgage that you couldn’t afford.
- Did you get a self-certified mortgage?
If you were encouraged to take out a ‘self-cert’ or ‘fast-track’ mortgage, without having to prove your income with payslips, you may have been mis-sold your mortgage.
Some brokers promoted these mortgages as they paid far higher commissions.
- Will you still be paying your mortgage after retirement age?
For example, if you took out a 30 year mortgage at age 40, did you lender or broker talk about how you might make the repayments in the final 5 years of the term if you had planned to retire at 65? You may have been mis-sold your mortgage.
- Did you pay a big fee to your broker?
Were you made aware of a broker fee that seemed to be quite high? Did you pay it or was it added to your mortgage without you knowing – and so are you paying interest on those fees every month? You may have been mis-sold your mortgage.
Phil Davison of Negative Equity NI says: “It’s becoming clear that mortgage mis-selling happened on a much bigger scale than even we imagined. Lots of people were sold mortgage products that weren’t affordable over the long term or that they would never be able to repay – interest-only mortgages are set to become the new PPI – a widespread issue for homeowners across the country. We’re well placed to help people who find themselves in this position”.
There are a few things you can do if you have been mis-sold a mortgage – give us a call and we can discuss your options.