Broker amended my mortgage application so I did not apply for a tracker

dokhtor

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moved from another thread - Brendan

A similar thing happened to me also. I applied through a broker, broker said I was approved in principle for a tracker, then in July 2008 the broker said that the tracker was no longer available but that SVR was the same product as the tracker. The rate sheet he showed only included SVR and fixed. I did not realize the broker could lie, so I signed.

Few years ago I discovered the trackers were only pulled in October 2008 and complained to the bank. The bank said they had no record of me ever applying for a tracker. When I sent them the copy of the original application form for a tracker mortgage, the bank responded first, that trackers were indeed available to me but they did not have to offer them and that second, the broker amended the application and opted for SVR, dated the day before or same day he informed me that a tracker was not available. I asked but the broker refused to provide any information whatsoever.

I get it, no case for FSO. If I understand correctly, consumer protection code is just advisory. I signed, case closed, and contract tramps disclosure requirements under CPC. But I signed on the basis of a false information. What I have is the application for a tracker, a letter from the bank compliance dept that the broker amended the application, and the fact that the SVR rate was higher than a tracker rate at that time. But I cannot prove that it was not me who knowingly chose the inferior product that was also more expensive, I did not tape the lying broker. I have no clue why a supposedly independent broker acted in the interests of the bank.

It is an old thread, and I only saw it now, but Raging Bull is not the only one who was blatantly lied to. Pity we cannot do anything about it.
 
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Brendan Burgess

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Hi Dokhtor

I don't think that the lender has any case to answer here. As far as they are concerned, you applied for an SVR and that is what they gave you. (But see below.)

However, the broker has a case to answer if he amended your form without your approval. That is the equivalent of fraud.

While there is a 6 year time limit on taking a case to the Financial Services Ombudsman, there is no time limit on fraud.

Have you taken it up with the broker?

I suggest you get a copy of the application form which the bank has and that you send a copy of that and yours to the broker and ask them for an explanation.

They might accuse the bank of editing the form. If that happened, you would have a good case.

There is no reason for the broker to amend your form. The bank would have a motivation to do so.

Brendan
 

Sarenco

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There is an inconsistency between this statement-
The rate sheet he showed only included SVR and fixed. I did not realize the broker could lie, so I signed.
...and this statement -
the broker amended the application and opted for SVR, dated the day before or same day he informed me that a tracker was not available.
Why would the broker amend the form? That makes no sense.
 

dokhtor

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I have taken it up with the broker. They said since it is outside the 6 year limit, they do not keep any docs and cannot answer, and that I should have take it with FSO. The FSO in turn said that it is outside 6 year limit and they I should consider the legal route. I am not rich to afford legal expenses to be frank, particularly since at the end of the day it is my word against the broker.

There is no inconsistency. The original mortgage application form indicated I applied for a tracker. I have that copy. It was I think in June 2008. The broker confirmed i was approved in principle for a tracker mortgage. I supplied the house related papers and in mid July the broker informed that the loan offer was ready but the tracker mortgage was no longer available to me. The rate sheet given only listed SVR and fixed. I signed the offer loan letter he gave. I was not even aware that any amended form existed, I was told the tracker mortgage was not available. Could he "amend" it by phone, simply asking the bank to send him a loan offer with SVR because the client was clueless? So that the application was effectively amended by me signing the svr loan offer? Just to be sure, I asked the broker to call them and confirm and he said they did. I only signed the loan offer with SVR that the broker gave.

I obviously do not know if the broker amended the form, you are right as it does not make sense. I only posted that the broker amended the form because the bank compliance department told me in an official letter that stated "our records indicate that your original application was amended to SVR by a broker that date" or something like that and the date was either the day before the broker came a loan offer, or same day, cant remember. I do not really believe the bank because Sarenco you are right, it does not make any sense, and second because in their first response to my complaint they said they had no record of me ever requesting a tracker mortgage and they only explained it away by "amended form by a broker" when I showed them the original application for a tracker, when clearly there was a record. So I have two letters contradicting each other. imho, it can only be explained that the bank perhaps asked the broker to chance it and the broker obliged. And the esteemed forum members perhaps would not be surprised to know that the bank in question is BOI and its mortgage outlet then, ICS/BOI.
 

dokhtor

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I cannot prove that it was not I who knowingly opted for a higher rate svr over a tracker that was also at a lower rate at the time because of some bizarre personal preference. My sense is that the broker could always argue I verbally instructed the broker to ask for an svr instead, hence the loan offer with svr. At the end of the day it would be my word against theirs, unless there is more evidence the practice was common in 2008. Or unless there is some kind of paper trail between the bank and the broker but it was probably all by phone.

Brendan, thanks for replying and I agree, I don't think I can prove anything. But I know i was lied to, and consequences are serious, I was prevented from making an informed decision. I since then moved on, switched to another bank. I posted in case someone reads and decides to stay away from the BOI as I think they all should.
 

Sarenco

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There is no inconsistency.
Well on the one hand you say you applied for a tracker mortgage which was approved in principle but then you say that you signed a loan offer for an SVR. That sounds inconsistent to me.

Ultimately of course it's what you signed that matters.
 

Monbretia

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Are you 100% sure that bank was issuing new tracker loan offers in July 2008? You only had approval in principle for the tracker mortgage initially, maybe by the time the full application was submitted in July the tracker was not an option for new loans. I know where I worked new tracker applications were not accepted from sometime in July 08 but loan offers already in the pipeline were given until I think Oct/Nov to drawdown.

As previously said there is no good reason for a broker to change it otherwise, no advantage to them.
 

Brendan Burgess

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Let's try to clarify what happened here

1) You filled in an application form with a broker on which you clearly applied for a tracker mortgage.
You have a copy of this application
2) BoI has a copy of your application form with your signature, with tracker crossed out, and SVR ticked.
3) You got a loan offer/approval in principle which had options for an SVR and fixed
4) You accepted this loan offer and you chose the SVR.

The dates are very important here.
If you applied for a tracker, but they were no longer being offered, it was not unreasonable for your broker to amend the application form so that it was for something which was on offer.

If applications for trackers were still being accepted by BoI, it would make no sense for the broker to amend the application.

We all know the value of trackers now, but back then people genuinely did not appreciate them. People accepted SVRs which were slightly below tracker rates which was madness.

The broker may have issued you with a "Reasons Why" letter why he was recommending this particular mortgage. I presume you didn't receive one, or if you did, you didn't keep it? (I am not sure if they were required to do so back in 2008)

Brendan
 

dokhtor

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Monbretia, this is what I thought first, that I was late. When I discovered about Oct 2008 pullout, I complained to the BOI. The BOI compliance department first lied I never applied for a tracker, then that the broker amended the original application when I showed the copy that I did. They have the same copy of my first application, I have not seen the copy of an "amended" application, or whether there was one.

Second, the same compliance department confirmed that the tracker mortgage was available to me at that time, my LTV<80, the works, and that their records stated the broker amended to svr, ie that i applied for one myself. that svr rate was higher. They did not say that in July they only worked with the loan letters issued, only confirmed it was available still. Not sure how much to read into it. Perhaps it is not true and in fact they did not issue loan offers even to those approved initially, and the letter is just a piece of garbage.

Brendan, the sequence is correct. In June I was told that the approval in principle was for a tracker. If the broker said from the outset it was for svr almost certainly i would have looked elsewhere. In July the broker said that it was no longer available to me and that the bank offered svr instead which was the same thing. He did not say he was recommending to amend the application for svr, I cannot recall a reasons why letter. He explained that I had no choice in the matter. There are other things that look dodgy in retrospect. How could a finance professional argue that a tracker and svr are pretty much the same product? He also pushed for a much larger amount I had in mind w/o any explanation as to the effect on the term and interest repayment. I was also clueless, they must have seen it.

This whole thing is not right, very misleading. If I applied directly to the lender and told it was no longer available, I could have asked why, or to insist. I could have had a record. When I asked the broker why, he said he did not know. When I insisted, he said he called them and that it was not available. When I subsequently asked the lender, the lender said why did I ask for it then, they have no record I asked.
 

todo

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@dokhtor I was pretty sure when I first read your post that this was Bank of Ireland, I'm not surprised at all that they did this to you.

Others will not agree that the bank instigated this, but I'm clear on that score.

My situation is similar to yours, except that no broker was involved.

Bank of Ireland were willing todo what ever it took to get a new customer on svr.

I'll add some of my dates here, may be of interest to you

1st of August 2008 Boi offered me a 2yr fixed mortgage rolling onto a tracker.

22nd of August 2008 Boi offer me a tracker mortgage for the complete length of the term.

11th September 2008 Boi have a policy change they are no longer selling trackers. (BOI confirmed this with me)

The only thing I can conclude is that BOI were willing to lure the customer in with the tracker and then come up with some method of switching them over to svr before they draw down.

BOI is not to be trusted, there is another poster on here that is lucky to have a recording of what they promised, its incredible what they will try to get away with.
 
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Sarenco

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Frankly, I wouldn't "trust" any financial institution - that's why we have contracts!

I'm still struggling to see what the problem is here.

Regardless of what you may or may not have applied for - you were offered an SVR and that's what you signed up to. Surely everything else is just "woulda, coulda, shoulda".
 

dokhtor

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todo, thanks. Makes me feel better there are many others affected by this but I wish nobody was. So your case suggests that it is true, trackers were still on in Aug and Sep, at least until 11th, it is plainly untrue they were not available in July. Thanks for confirming.

In fact, I looked up the letter from their compliance department and it states that "tracker was available as a product upon request from August 2001 to Oct 2008 when it was withdrawn." Also, in the same letter, "we have no record of you querying why a tracker rate was not offered to you before you accepted the mortgage loan offer". And when I forwarded the initial tracker application that they also had, they argued now that yes, you applied for a tracker but your broker amended it for svr in July.

I understand now how important the contract and your signature are. But the broker clearly lied on behalf of the lender and I do not understand why. The only plausible explanation is that the broker worked for the bank not his customer. I now know that lenders manipulate and lie but I did not then, it did not even occur to me.

It is great that the central bank reviews tracker contracts for contractual violations. But they will not get to the bottom of this unless they review all mortgages issued from 2002-8 for compliance with disclosure, affordability, product suitability requirements as in CPC 2006, let alone outright fraud. I looked up the CPC 2006 - it is all there, in plain English.
 

Brendan Burgess

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Regardless of what you may or may not have applied for - you were offered an SVR and that's what you signed up to. Surely everything else is just "woulda, coulda, shoulda".
That might well apply in contract discussions between large companies.

It should not apply in consumer contracts. If a financial institution or professional advisor induces a borrower to sign an unfavourable contract, then it's right to look at what happened before the contract was signed.

Brendan
 

dokhtor

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Sarenco, I disagree. You encounter violations of trust like this too many times, eventually you have Trump and Brexit, too many people will stop trusting the institutions in general. On a systemic level. On a personal level, my car mechanic tells me he changed oil and filters in my car, you trust him, i have no way of knowing if he did, I cant tell. You return something to the department store, they pay back your money to your account, I trust it is there, it never occurred to me to check because it is always there. When the broker says that he called the lender and that they confirmed it was not available, you trust that broker unless you know otherwise. Did you really expect me to ask the broker to write a signed deposition that he contacted them and this is what he said and this is what they said? If a broker is impartial intermediary, he should have told me the lender was bargaining or something and that I should have asked the solicitor to write a letter. Instead, he lied. How could I possibly know?

I do not know much about contract law but surely a contract signed based on misleading information at the very least could be reviewed by institutions tasked with financial regulation. What is the point of CPC 2006 when the lenders do not follow it at all?
 

Sarenco

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If a financial institution or professional advisor induces a borrower to sign an unfavourable contract, then it's right to look at what happened before the contract was signed.
That's a very big "if"! It's only with the benefit of hindsight that you can say it was an "unfavourable" contract from the borrower's perspective.

Frankly, this story just doesn't add up.

Why would the broker amend the form without the applicant's approval? There was absolutely nothing in it for him.

The bank were apparently still offering trackers at the time so why would they have had any incentive to pressurise the broker to amend the application form?

And at the end of the day, the OP was clear that he was signing up for an SVR - not a tracker. If that wasn't what he thought he had applied for, why didn't raise a query at that point?

To be honest, I really don't buy the "I don't know what a tracker is" line. The fact is that SVRs were often (marginally) cheaper then tracker rates back in 2008 and some borrowers took a risk that that would remain the case. With the benefit of hindsight, that obviously turned out to be a bad bet.
 

todo

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Frankly, I wouldn't "trust" any financial institution - that's why we have contracts!

I'm still struggling to see what the problem is here.

Regardless of what you may or may not have applied for - you were offered an SVR and that's what you signed up to. Surely everything else is just "woulda, coulda, shoulda".
Thats exactly the banks attitude, we set a trap for you, you fell into it, tough you fell for it. I once thought the cpc was there to protect against this, but it seems that is worthless waffle.

If we forget the method for a moment and just look at the input and the output of applying for a mortgage in the case of BOI.

Input --> The customer looks for a tracker, which the bank offers.
Output --> Customer ends up on SVR.

My argument is that BOI were willing todo whatever was necessary to get the customer on SVR before they drew down, particularly during the months of July, August and September 2008. The bank knew at that point trackers were bad business, but they still wanted new customers.

Take a look at complaint no 18 on page 51 at this link (2015 cold case r eview), https://www.dropbox.com/s/8ta5gvo2evkuof1/2015 Cold File Review.pdf?dl=0

Here is another example of customer tricked by Bank of Ireland, look at the inputs and outputs, then look at who is to gain.
 

Sarenco

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Input --> The customer looks for a tracker, which the bank offers.
Output --> Customer ends up on SVR.
But the bank didn't offer a tracker! It offered an SVR, which the applicant accepted.

Input 1. --> Customer looks for tracker.
Input 2. --> Bank offers an SVR.
Output ---> Customer and bank agree on SVR.

There's no "trap"! It's simple offer and acceptance.

The only logical reason the broker would have amended the application was because:-

1. The bank indicated that it was no longer offering trackers, either generally or to borrowers in the position of the applicant, so it would be rejected; or
2. His client requested him to do so.

Incidentally, the FSO found in favour of the bank in the complaint that you referenced and this was described as a well reasoned decision in the subsequent cold case review!
 

dokhtor

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What exactly does not add up? first the bank approves in principle for a tracker mortgage whether to entice the customer or because of no issue with trackers in June. Then in July the bank tells the broker that they only offer an SVR. The broker tells the tracker was no longer available to me, the product was gone. Then he calls the bank to amend the application and the bank gives him the svr loan offer. Or he first amends the application for an SVR, gets the loan offer, then calls me to tell the tracker was not available. I do not know what was first. The broker who dealt with banks on a daily basis could not possible think that the trackers were not available in July. As Todo illustrated, BOI still had trackers in July and August. The BOI's own compliance department replied to me that the tracker was available to me and that they have no record i ever asked for it. When I showed the only record I had, then they replied, oh well, you are right, the broker amended it then.

A benign interpretation is that the broker simply passed along the lender's words that tracker was not available, without telling me that the lender was "bargaining", aka lying, and that trackers were in fact available. A less benign interpretation is that the broker acted on lender's instructions to amend the application.

Your interpretation, Sarenco, if I understood your point, is that I somehow instructed the broker to choose an SVR that was if I can recall now, 0.2 higher than boi's tracker rate then, which was 1.25 over 4.25 ecb at the time I think. Or that the broker thought it was a better deal. But even if the rate was the same, or marginally lower like you said, which it was not, should not the broker have provided the rate sheet with all the options instead of omitting the trackers as unavailable? Also, the fixed rates were higher than an SVR then, why did not the broker omit fixed dates like he did the tracker rate?

Please recall what people did in 2008. In the context of 2008, people did not choose svr over trackers, they chose fixed rates over trackers because the rate was going up. The bad bet was choosing fixed over tracker, not svr over tracker. Even someone financially clueless as I was would not choose a more expensive svr over a tracker rate if it was available. You also said "why didn't raise a query at that point?" - I did raise it with the broker - he told me called the bank and they confirmed it was not available. The time line is like this:

Input 1. --> Customer looks for tracker.
Input 2. --> Lender approves for a tracker, the broker says it is the best deal, a customer stays with the broker
Input 3. --> Broker informs the customer the tracker was no longer available
Input 34. --> Customer asks the broker to contact the bank and ask why, the broker confirms it is not available
Output ---> Customer signs on an SVR because the customer believes he has no other options.
 
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dokhtor

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My point is that the disclosure requirements under CPC 2006 were clearly violated. Sarenco's point is that only the contract matters, nothing else. I take it to mean that the clauses in CPC 2006 are purely advisory, not binding. Unfortunately, I think Sarenco is right, it is all about your contract. This is why I switched and I am trying to forget the BOI like a bad dream.

But please do not take me for an idiot, I know I was lied to. The BOI's own letter confirms it. And you know what, if hypothetically the central bank reviewed all mortgages issued through the broker over the summer of 2008 and discovered, again hypothetically, that in the 100s of cases customers were "recommended" the BOI, all were approved in principle for a tracker but then all somehow ended up with an SVR, even if their contracts were in order, that would be abnormal still. Hypothetically. I would love to know what this broker did to other customers, what is the big picture. But if even Fitzpatrick managed to walk away yesterday, they all walk away, I have no trust in the system.
 
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