Endowment policies
Contents
If you were advised to take out an investment that was meant to pay off your mortgage when it was finished, did you later discover that you would not be paid enough? See the article : My in-laws are underwater on their mortgage and their home is in disrepair. Should they just walk away and move in with us?.
In that case, this could constitute a mis-sold policy. Read our guide to wrongly sold scholarships if you think this may apply to you.
Interest Only Mortgages
If you only paid the interest on your mortgage each month, the advisor should have made you aware of how you would repay your mortgage when it was finished. On the same subject : My in-laws are underwater on their mortgage and their home is in disrepair. Should they just walk away and move in with us?.
If your broker or lender did not discuss this with you or gave you examples of the cost of a mortgage and repayment loan compared to the lower cost of an interest rate loan, then this would be an example of a mis-sale.
Also, was it explained to you that you may need to switch your mortgage to a repayment loan rather than relying on rising house prices? If not, this can also constitute mis-selling.
Use our template letter if you want to complain that you have incorrectly sold an adjustable rate loan.
Remortgaging to clear your debts
If you wanted to consolidate your debt, were you advised that it would be cheaper for you to put all your loans, credit cards and financing on your mortgage? See the article : My in-laws are underwater on their mortgage and their home is in disrepair. Should they just walk away and move in with us?.
If not, you can exchange short-term debt for long-term debt by adding it to your mortgage.
Did the adviser explain to you that even if you initially wanted to lower your monthly expenses, you could very well extend your debt period and increase the interest rate you would pay sharply?
If not, this can be considered mis-selling.
Complain to your provider with our template letter if you were asked to remortgage to clear your debt.
Top tips
Household budget analysis
Were you asked to conduct a household budget analysis? Were you asked how much your monthly income was and what your monthly expenses were?
Did they work with you how much money you had left each month after paying all your bills, i.e. your disposable income?
If this was not done, you may have unknowingly committed to a mortgage that you could not afford.
Self Certification mortgages
Were you asked to provide proof of your income, such as payslips or audited accounts that could prove your income?
If not, were you encouraged to take out the so-called ‘Self Cert’ or ‘Fast Track’ mortgage where you did not have to prove your income?
These mortgage products paid much higher commissions and were very popular among some brokers for that reason.
If this applied to you, your mortgage may have been sold incorrectly.
Mortgages running past retirement
Should your mortgage run past your retirement age? Was this pointed out to you?
Did your broker or lender discuss how you would meet your mortgage payments when you retired?
A good example of this would be if someone takes a mortgage for 20 years at the age of 50 years.
The average retirement age is 65 years, which means that there are 5 years left to pay on the mortgage.
If the adviser did not at the time of the agreement take into account whether the customer could afford to make the payments after the age of 65, the customer may have been wrongly sold his mortgage.
Use our template letter to complain if you think you have been sold incorrectly.
High broker fees
Have you paid unreasonably high fees to the broker or adviser who arranged your mortgage?
Did you become aware of what the fees would be?
Were they added to your mortgage without your knowledge, so you now pay interest on them every month?
If any of the above applies to you, you may have misunderstood a case and you may want to use our template letter to complain to your provider.
Which? Money Compare
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