How far will house prices fall [volume 4]
Discussion
walm said:
2. Mortgages are pretty straightforward products. I doubt any retail customer ever gets a lawyer to check the small print of their mortgage contract - even when millions are at stake. Everyone knows how they work - they are to all intents a STANDARD(ish) product.
There's apparently some bottom twitching going on amongst mortgage brokers and advisors as they may now be accused of failing to advise clients (commercial and retail) that the fixed margin tracker they were signing people up for wasn't a fixed margin tracker at all.
walm said:
jdw1234 said:
Have you read the full trial document?
The one you linked? Yes.That doesn't mean I understood 100% of it!
anonymous said:
[redacted]
The judgement is linked on the previous page.Calling in the loans seems a bit of a red herring - I can't make out why that came up, it seems like a distraction. I assumed all loans could be called in, but for mortgages I guess you generally assume that wouldn't happen to you. Until....
anonymous said:
[redacted]
Having read the judgment, I concur - the clause you quote was pretty fatal to his case.He also asserts that it's a tracker, yet he clearly took out a fixed rate mortgage and they tend to be marketed as 'Fixed Rate' rather than sold on the basis that in 5 years' time they become trackers. It would be interesting to see whether it was sold as a tracker product; the evidence he adduced on the point was rubbish.
anonymous said:
[redacted]
Right, but there's a more specific statement in the offer:"After 30 June 2010 your loan reverts to a variable rate which is the same as the Bank of England Base Rate, currently 5%, with a premium of 1.99%, until the term end, giving a current rate payable of 6.99%."
There's a "current" missing - there should be one before the 1.99%.
If they wanted to have a TRULY variable rate after the fixed period they should have said "you go onto SVR which is currently BOEBR + 1.99%".
Everyone knows that you see the banks adjusting the spread in their SVRs all the time so that would be absolutely fair and above board.
Instead they have said in effect "it will vary with a spread over BOEBR" except that it doesn't.
Also this judge is clearly a toss-pot of the first order.
I mean WTF is this all about:
"However, a term of 25 years is a long time and it is unrealistic to suppose that during that period the lender had no right to terminate the mortgage. "
So the lender can terminate but the borrower can't????????
Git.
Everyone knows that you see the banks adjusting the spread in their SVRs all the time so that would be absolutely fair and above board.
Instead they have said in effect "it will vary with a spread over BOEBR" except that it doesn't.
Also this judge is clearly a toss-pot of the first order.
I mean WTF is this all about:
"However, a term of 25 years is a long time and it is unrealistic to suppose that during that period the lender had no right to terminate the mortgage. "
So the lender can terminate but the borrower can't????????
Git.
Sheepshanks said:
West Brom's barrister said that if they win this could be applied to householder mortgages too.
So far west brom have only gone after mortgages arranged through brokers, they haven't yet gone after mortgages arranged on the same terms in house yet, householder mortgages would be further down the chain still and I wonder if consumer protection laws would then protect them from this happening.anonymous said:
[redacted]
If I was on the west brom board I'd be considering legal action against the daily mailhttp://www.dailymail.co.uk/news/article-2920905/Le...
Just been on hpc website and there's this post on the west brom thread
quote said:
The main argument by the 118 group was that the offer letter stated that the interest rate was at a specific premium to the base rate, and therefore contradicted the mortgage conditions document which stated that the rate could be changed as necessary to reflect relevant investment interest rates, market conditions, etc. Therefore as there was an inconsistency, the more favourable terms must hold.
I think the key point in the judgment was that there was no inconsistency between the offer letter and the T&C, on the basis that a to be inconsistent there must be a direct contradiction and irreconcilable. If there is a reasonable interpretation which permits the reconciliation of the terms, then they are not inconsistent. In this case, the offer described the initial interest rate and one set of circumstances when the rate might change (namely the BoE rate changed). However, it did not specify that this would be the only circumstance in which the rate could change (which would have contradicted the T&C). Moreover, it did not matter that the offer letter did not state that the rate may change in other circumstances, as the whole of the offer letter and T&C needed to be read together as a single set of conditions.
Finally, just to rub it in, the judgment says that if the T&C had been "carefully considered by a prospective customer, [they] may dissuade him from accepting the lender's offer".
Now if that's right I can see how the judgment was arrived at rather than the mortgage was boebr+x and west brom changed it unfairly.I think the key point in the judgment was that there was no inconsistency between the offer letter and the T&C, on the basis that a to be inconsistent there must be a direct contradiction and irreconcilable. If there is a reasonable interpretation which permits the reconciliation of the terms, then they are not inconsistent. In this case, the offer described the initial interest rate and one set of circumstances when the rate might change (namely the BoE rate changed). However, it did not specify that this would be the only circumstance in which the rate could change (which would have contradicted the T&C). Moreover, it did not matter that the offer letter did not state that the rate may change in other circumstances, as the whole of the offer letter and T&C needed to be read together as a single set of conditions.
Finally, just to rub it in, the judgment says that if the T&C had been "carefully considered by a prospective customer, [they] may dissuade him from accepting the lender's offer".
Edited by Brite spark on Friday 30th January 14:25
Magog said:
So when does consumer lending end and business lending begin? There must be a reason why they only upped the rates for people with three or more btl properties, whereas those with one or two are still on base rate+1.99%.
Err.. When the lending is to a business its a commercial loan. don't you understand the difference?Second point, because they (the west brom) building society are in the s
t financially and have been since the crash. They are doing everything they can to recover. Expect them to squeeze every last drop out of the BTL portfolio until they are either a cash positive or they have disappeared from the balance sheet.The alternative would have been the b/society being wound up and the debt being sold on to someone else and/or the debt being called in.
sugerbear said:
Err.. When the lending is to a business its a commercial loan. don't you understand the difference?
what makes it a business? Just you saying so doesn't make it so.here are two definitions, neither automatically applies to every BTL
busi·ness
1.a person's regular occupation, profession, or trade.
2.the practice of making one's living by engaging in commerce.
NicD said:
what makes it a business? Just you saying so doesn't make it so.
here are two definitions, neither automatically applies to every BTL
busi·ness
1.a person's regular occupation, profession, or trade.
2.the practice of making one's living by engaging in commerce.
Btl's are businesses. You are providing a product\service in exchange for a fee.here are two definitions, neither automatically applies to every BTL
busi·ness
1.a person's regular occupation, profession, or trade.
2.the practice of making one's living by engaging in commerce.
NicD said:
what makes it a business? Just you saying so doesn't make it so.
here are two definitions, neither automatically applies to every BTL
busi·ness
1.a person's regular occupation, profession, or trade.
2.the practice of making one's living by engaging in commerce.
here are two definitions, neither automatically applies to every BTL
busi·ness
1.a person's regular occupation, profession, or trade.
2.the practice of making one's living by engaging in commerce.
Started drinking early tonight then?Jimmyarm said:
Btl's are businesses. You are providing a product\service in exchange for a fee.
You cant define words to mean what YOU think. 'providing a product\service in exchange for a fee' = selling something on fleabay or even working for a living.
are people who have lodgers running a business?
Of course, I get what you saying but you are conflating BTL and commercial terms and there has been no evidence to support this.
Just parrots of 'Btl's are businesses'
NicD said:
are people who have lodgers running a business?
I might be being naive here but I'd have thought it obvious that, technically, you were. You're getting income which you should declare and you have expenses which are allowable. I would say yes, you are. I don't know if there's something that says you're not because it's your home but I'd be surprised.b
At the end of the day, you're providing a service for financial gain.
anonymous said:
[redacted]
that is something different. A bit of me agrees with the 'stuff them' attitude.You would have to have a lot of faith in solicitors to think they would have flagged this judgment in advance, but in fact, I don't think we know the full reasoning yet.
btw, I have a 'lifetime' tracker with NatWest, and so far, no sign of them moving the goalposts.
Are these the same landlords who lobbied the EU to ensure less regulations for BTL mortgages?
http://www.landlords.org.uk/news-campaigns/news/bu...
http://www.landlords.org.uk/news-campaigns/news/bu...
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