Were You Mis-Sold A Mortgage?

Do you have a mis-sold mortgage claim?

You potentially have a claim if your mortgage was not suitable for you and you were advised to take it nonetheless AND as a result of this you are in a worse situation than you would have otherwise been. There are a number of reasons why the mortgage which you were sold might not have been suitable for you, and these include:

• The mortgage was misrepresented to you by omission. Usually, when two people enter into a contract of sale the seller must not say anything which is not true in order to persuade the buyer to agree to the contract, but there is no requirement that he specifically points out any negative aspects of the contract. However, in certain sectors such as investments, mortgage and insurance the seller is required to draw any negative aspects of the contract to the buyer’s attention specifically. For example, if you were told all the good things about the mortgage deal, but it was not explained to you that rates might increase substantially after the initial period then this may be misrepresentation;
• The mortgage adviser failed to properly assess the suitability and affordability of the mortgage, and didn’t take sufficient details about your financial situation to make an accurate assessment. This might include, for example, checking your monthly income and calculating how much money was left over after your monthly outgoings to put towards mortgage payments. Even if the adviser did this, he should have made sure that the mortgage payments didn’t exceed a reasonable percentage of your monthly surplus as this would leave you with no room for manoeuvre if interest rates went up and your mortgage payments increased.
• The mortgage adviser acted fraudulently by encouraging you to either apply for a self-certification (meant for self-employed people) mortgage in order to borrow more, even though you weren’t self employed or pressurised you into overstating your income or understating your monthly expenses in order to convince the mortgage provider that you could afford higher monthly repayments.
• The mortgage provider arranged a mortgage even though you were unsuitable as a mortgage candidate – for example where you were on benefits or where your mortgage would run past retirement age.

It is also possible to argue that a mortgage was mis-sold because the adviser breached FSA rules on impartiality and openness. For example, the FSA requires mortgage advisers to make you aware of their relationship with any mortgage lenders and if they are paid a referral fee or commission then they must explain this to you.