Lenders under fire for cancelling mortgage offers at eleventh hour

UK-Houses

High street lenders have come under fire for cancelling mortgage offers based on their own mistakes, costing borrowers money.

One case has seen a lender withdraw its offer so late that the buyer and seller had already exchanged contracts and were legally obliged to complete the deal, Money Marketing sister title Mortgage Strategy understands.

The Association of Mortgage Intermediaries says the errors often take the form of lenders recording wrong client information, or valuers making mistakes.

Ami chief executive Robert Sinclair says lenders who act this way cost borrowers their valuation fees and possibly commitment fees and deposits too. It expects to see more cases emerge.

Coreco director Andrew Montlake says: “It’s a worrying trend. Offers are meant to be binding, and if a lender has made a mistake then that should be their issue.”

Fairer Finance managing director James Daley says: “It isn’t treating your customers fairly to tell them you’re providing them one deal, then move the goalposts.”

Ami has reported the issue to the FCA.

But it is understood the regulator will not act until more cases occur, and says advisers should complain to the lenders involved and to the Financial Ombudsman Service.