Sorry about the loss of the house.

I feel you would be on a loser chasing the potential lender as a) mortgages are not covered by the various consumer credit acts, legalistically they are making you an offer (that includes the HLC details) and you may chose to accept of not accept it.

The code of practise etc., is certainly grounds for 'appeal', but I feel (but do not know) that the lender could offer what they want regardless of code, if they feel that extreme circumstances justify it.  And the underwriter must have some reason for this charge otherwise they would not be turning away business.

Nationwide Building Society are currently running a fairly high profile ad campaign to the effect of "we don't have HLC's".

Its splashed all over the TV and their website... may be worth a punt with them?

EB

Try Agile Business Services who check 27,500 lenders on computer in your home and are out the front door within 35 minutes.  Tel 01388 730703. Based in County Durham but presumably have countrywide advisers or they may do it over the phone.  We found their services excellent.   No get in fees, no get out fees, no solicitors fees, no penalties and excellent rates.  Good luck.

 

Thanks for the update - and so sorry that you have lost the house anyway.

I would be really interested in a 'name and shame' if your IFA doesn't get anywhere. However, you may want to use the same Lender again if things get sorted out - so probably best not to go in too hard yet!

Louise

Because as far as I'm aware, In Scotland the house buying process is more certain in that when you bid for a house and its accpeted, then that is the start of the the legally binding agreement. See Below:

Although the basics are the same it is the timing of when the contract becomes legally binding that has led to two different approaches. It is important to understand that there is no second step in the Scottish procedure and that the contract can become legally binding at a relatively early stage, unlike in England where contracts are often exchanged towards the end of the process. Here we prefer not to wait until the removal men are at the door before concluding a binding deal!

 

I'm confused.  Why are you wishing you were buying a house in Scotland?

(Thanks for raising the HLC issue btw - we're waiting for our final paperwork from Nationwide, whose KFI clearly state they don't have HLC. I'll read very carefully thanks to you!)

 

 

 

 

Louise,

 Many thanks for the response and no need to apologise. It's hard to know if your are ever in the right or wrong camp when it comes to something like mortgages which the banks insist on treating as a black art. I'm glad my initial outrage seems justified. Our IFA has all also been as shocked as us and is pursuing the case with the lendor as we speak.

To make matters worse our buyer has just pulled out for personal reasons 6 weeks down the line so my battle with the lendor may be in vain if I cant find a property within the lendors agreed timescale.

Outcome to Date:

£330 lost on survey

£300ish lost on searches

6 weeks of dreaming/planning and eventual time wasting by our vendor

Wishing I was buying a house in Scotland

Detesting the governement for allowing these situations to continue to happen.

 Louise - I will update the thread when I know more and may even name an shame if the board is interested ;-)

greeko33 - I am so intrigued by the issue you have underlined here - and so apologetic it has taken me so long to get onto the case.

Higher Lending Charges are an real issue with me as many Lenders hide behind them as 'mittingating risk' when in fact many Lenders only charge them on certain products over 90% - but not all!

However, your issue is especially pertinent. You appear to be saying that the Key Facts Illustration (KFI) makes no mention of the HLC - but the Offer of Mortgage does. That certainly contravenes the regulations held in the Mortgage Conduct of Business Rules which state that the Offer should reflect the conditions outlined in the KFI.

The first action should be taken by your mortgage advisor. If he has sourced a mortgage without an HLC, issued a KFI to that effect, been verbally told the product does not carry an HLC - then he should be jumping up and down on your behalf with the Lender and raising the issue with the press!

I would be really interested to know the details of the product selected and your exact borrowing requirements against the value of £245,600 so we could do some independent research here at moneysupermarket.com.

Louise

I can understand that, indeed!

I wish you luck with it, too.  And i agree that you should be able to get what you ask for.

 

Cat

 

Catastrophica,

They are not standard as far as I (or my IFA) know and friends of mine have obtained 95% LTV motgages with no HLC.

When you specifically ask for all option without HLC and your IFA selects the 'no HLC' button on his search facility you generally expect it to happen.

Sorry for the jokey response but i'm frustrated that the most expensive commitment in my life is not going smoothly as planned.

Higher Lending Charge?

I thought that they were standard....

Hmmmm.  Can't help I am afraid but maybe our expert will.

Cat

HLC = Higher Lending Charge

This is a premium charged by Lenders in order to indemnify themselves, and NOT the borrower, against any financial shortfall they may incur in the event of repossessing a property which must then be sold at a loss. It is applicable if the amount required is higher than a certain percentage of the property value, usually 75% LTV; often the Lender will pay the cost of this insurance themselves between 75% and 90% LTV. The charge may either be added to the loan or deducted from the advance on completion.

Taken from web source

What is an HLC?

All,

 I'm pulling my hair out and would appreciate some advice.

Its been 5 weeks now since my first mortgage application and I still cant get one without a HLC.

On both occasions my IFA has been told (and is fully aware) that i do not want a HLC and to exclude all products that have one. Once we find one we sign the doc's, note the Key Facts agreement has no HLC stated and wait for survey and offer.

Both times now the lenders offer has come back with a HLC which having taken all the above precautions seems to be false advertising/miss-selling to me. Our IFA is equally baffled and says it has never happened before. On the second application we even phoned the lendor who we have on record saying that the mortgage has no HLC!

I'm now having to contemplate accepting the mortgage (without predjudice) while making a compliant and claim for compensation with the financial ombudsmann. I dont want the seller to default as I really want the property.

Is it always this hard and what chance do you think I have for compensation. FYI the rates of the loans offered have risen in the past from 5.55% to 5.93% in the last week and will have a massive impact on our £245,600 valued property.

Thanks in advance!