Can you spot a mis-sold mortgage?

It is thought that a large number of homeowners in the UK may have been mis-sold a mortgage. Unfortunately for many it is too late when they realise that their mortgage is simply not suitable for their financial circumstances. Common reasons for a mis-sale include individuals who were asked by their mortgage broker to apply for a self-certification mortgage. Self-certification is available for consumers who cannot prove their income; in many cases these are self-employed individuals who have numerous sources of income. However those individuals who were not self-employed and were still asked to apply for a self-certified mortgage may have been asked to declare a higher income allowing them to obtain a larger mortgage. If you were encouraged to do this by your mortgage broker then you may be entitled to a mis-sold mortgage refund. Check your mortgage agreement for signs of mis-selling The advice for anyone with a mortgage, especially those who applied for their mortgage before 2004, is to verify the details of your mortgage agreement and be sure that the agreement meets your financial circumstances. The Financial Services Authority has a set of guidelines called the ‘Mortgage and Home Finance: Conduct of Business’ (MCOB). It states that mortgage advice must be suitable for each individual customer and that good records should be kept to show that this advice has been properly demonstrated in each case. Only then can the mortgage adviser be in compliance with the law and avoid litigation if the customer subsequently suffers a financial loss. This highlights the importance for brokers to discuss the essential specifics regarding a consumer’s mortgage agreement and its length. For example, you should be made aware of issues which may occur due to your retirement age or if you have medical health issues, these circumstances may still affect your mortgage repayment plan even though the mortgage broker was aware of them at the time of the sale.