What should I do if I have a complaint about a lender
The first port of call should be the lender themselves.They will have a complaints process Under the Financial Conduct Authority rules. If you remain unhappy with the lender’s response, it is possible to take the complaint to the Financial Conduct Authority directly and to the Financial Ombudsman.
What regulations exist for buy to let mortgages
Although pressure has been put on the government to introduce legislation, currently there are regulations in place for some types of buy to let mortgages buy to let mortgages. However, it is still possible to make complaints in the same way as you would for a traditional mortgage.
The FCA does not regulate mortgage sales if one or both of the following apply:
The mortgage is a second charge on your home. “Second Charge” means you already have another loan secured against your home.
Less than 40% of the property on which the loan is used or will be used as a home by the borrower or a member of the borrower’s immediate family.
What is the maximum term of mortgage obtainable
Every lender varies regarding the maximum number of years for which they are prepared to lend. Generally, the maximum length of time for a mortgage is 40 years. Most lenders will be prepared to lend beyond retirement age, provided the borrower can prove that they have sufficient income to afford the repayments.
What should I do if I get into financial difficulty
One of the first things that you should do when you start to struggle financially is to get a statement of affairs produced detailing all of your income and expenses, both regular and occasional. Once you have a clear idea of your position, arrange a meeting with your lender BEFORE you get into arrears.
During the meeting, inform them of your difficulties and suggest a suitable plan for the future. Typical ideas may include a payment holiday to deal with a short-term drop in income, e.g. through maternity leave, reversion to an interest only mortgage to deal with a more unpredictable drop such as redundancy or even an equity release package for those who are older and require additional income to assist with retirement costs.
As a result of the government’s response to the effects of the credit crunch, a lender must now act sympathetically towards their borrower and show that all possible alternatives to repossession have been considered, before a repossession order will be approved by the courts.
Can I switch mortgages
Yes, although there may be a restriction preventing you from switching during a fixed or discounted period. Bear in mind that there may also be early redemption charges which means that you will have to pay your current lender in order to redeem the mortgage.
Most borrowers will consider swapping when a fixed or discounted period is about to come to an end.
What is the difference between a mortgage redemption statement and a balance statement
A balance statement simply shows how much of the capital is still left to be repaid at any give point in time. This does not take interest payments and early redemption fees into account. Most lenders will show the balance as part of their monthly statement. This figure should be available free of charge to borrowers on request.
A redemption statement normally carries a fee and is generally only requested when the property is due to be sold or the borrower is considering changing lenders. The redemption statement states the exact amount that has to be paid on the given date to redeem the mortgage including interest due, the capital and any early repayment charges.
Can I obtain a mortgage on a build project or a renovation project
Yes, some lenders provide the option of a mortgage specifically aimed for a build project. This way, you can agree a total amount for the mortgage and draw down sections at the time, as the project progresses. One of the main advantages is that you only generally start paying interest on the money once you have drawn it down, so you can continue your build safe in the knowledge that the cash is available, but without having to pay for it until you actually need it.