When you were advised to take out an investment that would pay off your loan when it was completed, did you later discover that you were not paying out enough? See the article : I think I’ve been mis-sold my mortgage, what can I do?.
If so, this may constitute a false selling policy. Read our guide to wrongly sold endowments if you think this might apply to you.
Interest Only Mortgages
If you are only paying the interest on your loan each month, then the adviser should have told you how to repay your loan when it was completed. Read also : I think I’ve been mis-sold my mortgage, what can I do?.
If your broker or lender did not discuss this with you or gave you examples of the cost of a capital and repayment mortgage compared to the lower cost of an interest only mortgage, then this would be an example of a false sale.
Also, have you been told that you need to switch your loan to a repayment loan instead of relying on rising prices? If not here’s a new product just for you!
Use our template letter if you want to complain that you have sold an interest-only mortgage incorrectly.
Remortgaging to clear your debts
If you want to consolidate your debt, are you advised that it would be cheaper to put all your loans, credit cards and finances on your loan? To see also : 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 swap short-term debt for a long-term debt by adding it to your loan.
Did the adviser explain to you that even if you initially reduced your monthly expenses, you might extend the term of your debt and increase the amount of interest you would pay enormously?
If not, this can be constituted as a false sale.
Complain to your provider with our template letter if you are encouraged to remortage to clear your debts.
Household budget analysis
Are you asked to complete a budget analysis? Are you wondering how much your monthly income was, and what your monthly expenses were?
Have they worked with you on how much money you have left over each month after paying all your bills, ie your disposable income?
If this was not done, you may have unknowingly committed yourself too much to a loan that you could not afford.
Self Certification mortgages
Are you required to provide proof of your income, for example pay slips or verified accounts that could prove your income?
If not, are you encouraged to take out what is known as a ‘Self Cert’ or ‘Fast Track’ mortgage where you do not need to prove your income?
These mortgage products paid much higher commissions and were very popular with some brokers for that reason.
If this applies to you, your mortgage has been sold incorrectly.
Mortgages running past retirement
Should your loan run past your retirement age? Was that pointed out to you?
Has your broker or lender discussed how you would meet your loan payments when you retire?
A good example of this would be taking out a mortgage for 20 years at the age of 50.
The average retirement age is 65, which means there are 5 years left to pay on the mortgage.
If at the time of the agreement the advisor did not take into account whether the client could afford to make the payment after the age of 65, then the client may have sold his loan incorrectly.
Use our template letter to sue if you think you have been sold incorrectly.
High broker fees
Did you pay unreasonably high fees to the broker or adviser who arranged your loan?
Are you aware of the costs involved?
Were they attached to your loan without you knowing that you are now paying interest on them every month?
If any of the above applies to you, then you may have a case of false sales and you may want to use our template letter to complain to your provider.
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