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UK-Justice
UK-Justice, Barrister
Category: Law
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Experience:  Called to the Bar in 2007
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I have a dispute with my mortgage lender. I took an interest

Customer Question

I have a dispute with my mortgage lender. I took an interest only mortage out on a tracker rate for 25 years back in 2005. The rate was 1.79% above B of E base rate. They offered me a slight discount on this ending September 2006.

They let the rate stay discounted longer than they should until end of 2006. In October 2006 they told me that unless I chose another deal (over three years they said) I would lose my discounted rate.

I spoke to them twice about this in October and November 2006 and know who I spoke to and when, as it is in my diary for that year. The mortgage lender has no records of it. The person I spoke to told me I had a choice of two rates over three years, a fixed rate or a tracker rate. I chose a tracker rate. What they did not tell me is that at the end of the three years the mortgage would go back onto their standard variable rate.

I would never have agreed to this if I knew I was losing my 1.79% tracker rate. They never told me this but claim they sent a Product Transfer offer. I never saw this document and never signed anything.

In January 2010 my mortgage rate went onto a 4.84% tracker rate when it should in my view have gone on to 2.29% (0.5% + 1.79%). Because I have a high mortgage I am being hit for almost £2,000 a month more than I think I should pay. I am now in arrears and at risk of repossession.

I took it to the Ombudsman and they said that as I had (in their view) consented to a new product the old one did not matter any more. I appealed their decisions but they ruled for the bank. Since then I have found my 2006 diaries so have exact dates of the two conversations and the name of whom I spoke to. I am thinking of taking it back to the Ombudsman.

I am also thinking of sueing the bank as I don't believe I consented to the new reversionary rate and I have better details of the verbal converasations I had than they have.

Do I have any chance to winning this case and getting the mortgage back onto the tracker rate of 1,79% above base and if not why not? Surely this cannot constitute a contract when they omitted to tell me I was losing my tracker rate for the term of the mortgage?

No doubt they will wave their Product Transfer Offer in front of a judge but for all I know they have fabricated it and are also lying saying they do not have records of the 2006 phone conversations which they would normally record.

I have disabled dependents and am really worried as if I sue them and lose the case I could be hit with their costs. The amount of money involved it too great to go through small claims or be fast tracked so costs could be really high. I do have a solicitor who said he would represent me under 'no win no fee'. I signed all the forms and he has helped protect me from repossession but now he says the insurers never agreed for him to do this on 'no win no fee' and I will have to pay. also need to know whether he can do that and leave me high and dry?

So 1) Do I have a case against them based on the above 2) Can the solicitor withdraw the 'no win no fee' agreement when he never had agreement from his insurers to cover it in the first place? 3) Can the bank get a suspended possession order if the monthly mortgage payments are disputed?

Can you advise me at all? I am really desperate and scared of losing my home.
Submitted: 3 years ago.
Category: Law
Expert:  UK-Justice replied 3 years ago.
Thanks for your question, I will do whatever I can to help you. Please remember to rate my answer SMILEY FACE OR ABOVE.

So when did this breach occur, October 2006?

Did they offer you the two rates in writing?
Customer: replied 3 years ago.

By 'breach' do you mean 'date when I dispute that there was a new contract but they say there was one'?


 


If so, Novermber 2006 in my view. I have the exact date and who I spoke to. They did not represent the options in writing only verbally and I chose one of them. They never articulated verbally that I would be swopping the reversionary rate of the mortgage from a tracker at 1.79% above base to theIr standard variable rate as part of this new three year deal ..i.e. that they were giving me one thing but taking something else away which was one reasons I took their product in the first place. The only thing they say they sent was a Product transfer offer confirimng that I would be on a tracker rate until Jan 2010 and then on their variable rate but I never received this or signed anything.


 


At the time banks were falling over themselves ot lend money. I believe they would not have wanted to articulate anything that could put me off taking a deal but at the same time wanted to get rid of the tracker rate that was less commercially attractive for them, as SVR is always higher.

Expert:  UK-Justice replied 3 years ago.
Thanks.

You have 2 choices:

1) Raise a formal complaint. This will then be investigated as a corporate complaint.

If you are not happy with the response then you can complain to the Financial Ombudsman. They are free, independent and can examine your complaint for free.

They can be found at:

www.financial-ombudsman.org.uk

If they find against you then you can only take the matter to Court (see below).

2) Court

You could sue for breach of contract. However the problem you have is this. Under the Limitation Act 1980 you have 6 years to bring a claim from date of breach.

You said this was November 2006 which means the last date you could bring a claim is November 2006.

Based on what you have said you have waited too long and any claim would fail because it is an absolute defence.

However I would therefore suggest making a formal complaint and then going via the Ombudsman.

But if the Ombudsman finds against you that is going to be the end of the matter because of limitation.

I am sorry if this is not the answer you are looking for but based on what you have said, this is the legal position.



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Customer: replied 3 years ago.

The breach of contract only became apparent in January 2010 and I held back pursuing it while the Ombudsman were looking at it which took nearly 15 months. Can I argue that the breach took place at the point they tried to enforce the SVR in January 2010 as prior to that they did what I thought they were contracted to do?


If I go back to the Ombudsman they will need new evidence. All I appear to have that is new since they ruled agasint me is my diary showing dates and person I spoke to in November 2006 as per my previous E Mail.


 


Please advise.


 

Expert:  UK-Justice replied 3 years ago.
It does not matter when it became obvious, it is when it actually look place.

You can try and argue the breach took place later.

The only other option if the Ombudsman ruled against you is to go to Court.

But you will need to show what they said was wrong and they knew it was wrong - assuming you overcome the Limitation issue.

I hope this clarifies.


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Customer: replied 3 years ago.


Even if I can sue them do I have little chance of success against a big bank especially given that I will be mainly representing myself?


 


Also if I lose will they add their costs to my mortage balance or sue me for the money.

Expert:  UK-Justice replied 3 years ago.
I think your chances are less than 50%.

If you lose then you would be responsible for their costs.

They wont add it to the mortgage - you would be required to pay the costs within 14 days.



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Customer: replied 3 years ago.

If I couldn't pay might they go for bankruptcy?

Expert:  UK-Justice replied 3 years ago.
Its possible but that is a decision for them.




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Customer: replied 3 years ago.

Given what I have told you and given the risks to me even though we are disputing a very large amount of money per month would you advise me not to pursue this and take it back to the Ombudsman. If the Ombudsman still say no, to settle with the bank in some way to de-risk this?

Expert:  UK-Justice replied 3 years ago.
I would take it back to the Ombudsman.

If the Ombudsman is against you personally I would not risk litigation.

I hope that helps.


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Customer: replied 3 years ago.

Onefurther question. As I said I had a solicotor who had agreed to take this on a no win no fee basis but it now appears he never had authority from the insurers to do this. Can he withdraw this from me once he has agreed to do it or is he bound to continue it? If so do I have any chance of getting anyone to take on a case like this on no win no fee or is that highly unlikely?

Expert:  UK-Justice replied 3 years ago.
He should continue unless instructed otherwise.

As such you need to check the terms to see if you are liable for any costs if you change Solicitor.

Its unlikely anyone else would take this on the same basis with another Solicitor instructed.



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Customer: replied 3 years ago.

If he refuses to and given that I have been told by a court that I have to counterclaim withn 2 weeks of now what should I do/who should I go to? He now wants £750 plus VAT to put in the counterclaim that I can ill afford. I have the no win no fee terms in writing but he has withdrawn this facility verbally saying his firm were never paid for what has been done so far.


 


Having no win no fee gave me some element of courage on this case. If it is withdrawn I will be in a worse position than when I started as I could have come to an arrangement with the bank before it came to court for repossession.


 


Can I tell the court what he has done and that it is delaying me putting in a counterclaim and ask for more time? How would I do this?


 


 


If he agrees and this can continue on a NWNF basis will this take away my risk re the other side's costs.

Expert:  UK-Justice replied 3 years ago.
You need to make an application on form N244 and pay a fee of £80

There will be a hearing and you can explain to the Court what you want to do.

I hope this clarifies.



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Customer: replied 3 years ago.

It does. If this can contiue on a NWNF basis would that mitigate any risk re the other side's costs if I lose?


 


If the solicitor refuses to continue on NWNF what should I do given the urgency?

Expert:  UK-Justice replied 3 years ago.
Yes it would but generally you need insurance to take out against costs if you lose.

If the Solicitor refuses you need to try and find another Solicitor.

But if chances fall below 50% of winning, no-one would take this on.



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Customer: replied 3 years ago.

Does the soliciotor have any liability if he took this on on NWNF and then pulled it without my consent?

Expert:  UK-Justice replied 3 years ago.
If it fell below 50% chances of success then no.



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Customer: replied 3 years ago.

How do I know this if he never articulated it at the point we agreed NWNF?

Expert:  UK-Justice replied 3 years ago.
You need to check the terms of the agreement you signed.

Please remember to give my answer a good rating.

The question does not close and you can ask follow ups.


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Customer: replied 3 years ago.

So just to be clear before closing:


1) The case may be a non starter if Limitation Act of 1980 applies


2) Even if it does not apply it looks to you like a weak case or at least < 50% chance of success.


3) I could be on for a lot of costs if I lose. £10,000 or more and these won't get added on to my mortgage.


4) Running this myself increases risk.


5) I can delay recent judgement using N140 application.


6) My solicitor may be under no obligation to continue this on NWNF.


7) If he won't you advise me not to sue the bank as it is too risky


8) Ombudsman is best option if I have new evidence.


 


Is that all correct?

Expert:  UK-Justice replied 3 years ago.
Correct...................



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Customer: replied 3 years ago.

What do I do if I want you specifically for follow up later should this develop?

Expert:  UK-Justice replied 3 years ago.
You can follow up for free on this thread.





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UK-Justice, Barrister
Category: Law
Satisfied Customers: 16193
Experience: Called to the Bar in 2007
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Customer: replied 3 years ago.

One further question.


 


Does the 1980 Limitiatonis act not allow 12 years for a contract on land? Would this not apply here?

Expert:  UK-Justice replied 3 years ago.
Breach of contract 6 years.

In terms of dispute in relation to the land itself 12 years.

This is to do with the lender.



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Customer: replied 3 years ago.

Thanks for this.


I can't find the N140 form online.


 


Can I use it to ask for an order of court to be varied?


 


Last Monday there was a repossession hearing as an outomce of this dispute due to alleged arrears. I was was told that the judge would not grant a suspended possession order and would agree to certain terms of payment if I counterclaimed against the bank within 21 days. I now can't counterclaim in this window because NWNF has been withdrawn. Can I ask for more time using N140?


 


Also the amounts articulated by the bank in that hearing now appear wrong. If I have some proof of this can I also ask for the payments agreed in the hearing to be changed?

Expert:  UK-Justice replied 3 years ago.
You need from N244 not N140.

You can use form N244 to ask that the order be caried.

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Customer: replied 3 years ago.

Thanks again for clarity.


 


If I do this using N244 how quickly will I get a response or will there need to be another hearing?


 


Am I still bound by the original order until I get a response or this is agreed/resolved or will it all go on hold? What if this goes beyond the 21 days to counterclaim?

Expert:  UK-Justice replied 3 years ago.
It depends on Court listings how quick it will be listing.

There will be another hearing.

And yes you are bound by the original order until varied.

I hope this helps.



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Customer: replied 3 years ago.

That is fine from a monetary point of view but what if it is impossible for me to counterclaim properly in the window agreed due to the new circumstances. This may make it impossible for me to not breach the first order and would force me to put in a counterclaim at all costs even if I did it myself. Also the monetery amount has only been agreed on the condition I counterclaim in 21 days. Is this catch 22?

Expert:  UK-Justice replied 3 years ago.
You can ask the Court for an extension of that time.

Or the other side if they agree then you dont need an application.




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Customer: replied 3 years ago.

How do I ask for that extension? Assume that is in additon to the N244?

Expert:  UK-Justice replied 3 years ago.
Well write to the other side first.

If they refuse then yes put it on N244.




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Customer: replied 3 years ago.

Thanks I will do that.


You are a real star. Thank you so much for your help and advice. At least I can make a more informed decision at this stage. I cannot thank you enough. Will look to continuing thread if this moves on.


 


 


 


 


 


.

Expert:  UK-Justice replied 3 years ago.
Welcome.
Expert:  UK-Justice replied 3 years ago.
I'm just following up with you to see how everything is going. Did my answer help?

UK-Justice

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