Endowment policies
Contents
If you were advised to invest an investment designed to pay off your mortgage when it ended, did you later find out that you would not be paid enough? 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 so, this could be a mis-selling policy. Read our guide to mis-selling endowments if you think this may apply to you.
Interest Only Mortgages
If you were only paying the interest on your mortgage each month, then the adviser should have informed you how you would repay your mortgage when it was finished. 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 your broker or lender has not discussed this with you or given you examples of the cost of a Capital and Repayment mortgage compared to the lower costs of an Interest Only mortgage, then this is an example of mis-selling.
Also, have you been told that you may need to change your mortgage to a Repayment mortgage instead of relying on rising house prices? Otherwise, this may also involve mis-selling.
Use our letter template if you want to complain about an interest-only mortgage mis-selling.
Remortgaging to clear your debts
If you were trying to consolidate your debts, were you advised that it would be cheaper for you to put all your loans, credit cards and finances on your mortgage? 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 not, you could be exchanging short-term debt for long-term debt by adding them to your mortgage.
Has the adviser explained to you that while you may be reducing your monthly outlays initially, you may be extending the term of your debt and significantly increasing the amount of interest you would be paying?
If not, this could be considered a mis-selling.
Complain to your provider with our template letter if you have been encouraged to remortgage to clear your debts.
Top tips
Household budget analysis
Have you been asked to do a household budget analysis? Were you asked how much your monthly income was, and what your monthly outlays were?
Did they work out for you how much money you had left each month after paying all your bills ie your disposable income?
If this is not done, you may have unknowingly made too much of a commitment to your mortgage that you were unable to pay.
Self Certification mortgages
Have you been asked to provide evidence of your income, for example, payslips or audited accounts that could prove your income?
If not, have you been encouraged to take out 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 among some brokers for that reason.
If this applies to you, your mortgage may have been mis-sold.
Mortgages running past retirement
Does your mortgage run out of retirement age? Have you been told this?
Has your broker or lender discussed how you would meet your mortgage payments when you retired?
A good example of this is if a person takes out a mortgage for 20 years at the age of 50.
The average retirement age is 65, which means there will be 5 years left to pay on the mortgage.
If, at the time of the agreement, the adviser did not take into account whether the customer was able to make the payments after the age of 65, the customer may have mis-sold his mortgage.
Use our template letter to make a complaint if you think you have been mis-sold.
High broker fees
Have you paid unreasonably high fees to the broker or advisor who arranged your mortgage?
Have you been told what the fees are?
Were they unknowingly added to your mortgage so that you are now paying interest every month?
If any of the above apply to you then you may have a mis-selling case and you may want to use our template letter to make a complaint to your supplier.
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