Uproar as Mortgage Express spokesman reveals their Exit Strategies

Uproar as Mortgage Express spokesman reveals their Exit Strategies

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Uproar as Mortgage Express spokesman reveals their Exit Strategies

Mortgage Express logoA spokesman for Mortgage Express revealed their exit strategies at the Northern Property Tribes last night which was met with uproar both on and off-line.

Apparently, if you sell a property that’s mortgaged to them, Mortgage Express have the right to call in all of your other loans.  The details of how they can insist on this are apparently in the small print of their buy to let lending terms and conditions.   It was also intimated by the Mortgage Express spokesman that the bank is retaining the entire proceeds of sale where a property is sold.  Questions have been raised by landlords over the legality of this practice and terms and conditions are being poured over by landlords and their legal advisers all over the country.

Several landlords have already confirmed that they have put off plans for selling one or more of their portfolio as a result of this revelation so it seems that Mortgage Express plans may well backfire on them.

The spokesman for Mortgage Express did go on to say that they have the ability to be reasonable and flexible but by then the angry mob to which he was presenting were in no mood for further debate.

The point regarding CGT on sales was made and was apparently met with a very woolly response.  If a property had increased in value but MX were planning to retain all sale proceeds to reduce other loans how would the landlord raise the funds to pay the CGT bill.  The MX spokeperson suggested that MX might release the funds to facilitate the tax payment which would be at some point in the future but the property investors in the room were having none of it.  Several had already had their fingers burned on the Mortgae Express Choices plan which encourages over-payments with flexibility to access the funds over-paid at a later stage.  The concept is to reduce interest payments which outweigh the interest which would be received if the money was deposited elsewhere.  Property118.com reported on this scheme and the complaints received from landlords back on 27th October 2010.  Read the article here.

What do you think of the exit strategies of Mortgage Express?  Are they following the FSA guidelines of “Treating Customers Fairly” in your opinion?



Comments

7 years ago

I have a mortgage with MX and with Bradford and Bingley. These are one and the same and a while ago they merged both accounts and said it was their right to do so. At the moment I am not too unhappy with this as with their SVR I am making a small profit. The company I am concerened about is Mortgage Agency Services number 5 Limited as they are continously increasing their rates so I have one mortgage with them which means I lose £105 a month. I have written to them several times but they just stick two fingers up and tell me if I'm not happy get some other mortgage. They know this is out of the question at the moment as the property is in neg equity and I do not have the money for a deposit also at my age no one will now give me a mortgage anyway. Regards Hoe Brand

7 years ago

In my opinion, MX is being unreasonable and its strategy will fail the FSA guidelines of 'Treating Customers Fairly'. The reason the mortgage lenders are taking their unreasonable behaviour to new heights is because many landlords who have potential good claim are not taking them on. Many landlords and landlord associations are scared of pushing the mortgage lenders fearing reprisals. However, BTL landlords and association must understand that BTL is a big business for mortgage lenders and they cannot afford not to have any BTL landlord customers. If landlords continue to keep quiet without taking action against obvious unfair practices from mortgage lenders, there is almost nothing anybody else can do.

7 years ago

Presumably you mean "...all other loans with them." They can't call in your loans with other lenders, surely?

Mark Alexander

7 years ago

Fair point, it's just your loans with them.

7 years ago

MEX are a cowboy outfit dressed up as a mortgage lender. The simple fact is that they are I believe, 80% owned by the UK Taxpayer and why we and the UK Government have put up with the Unfair charges and practices of this stinking, rotten bunch of usurers for the past 2/3 years since Bradford & Bingley were bailed, out is quite beyond me. I have complained over the past 2 years to the Bank of England, The FSA, The last Chancellor of the Exchequer protesting about their Sharp, Unfair Lending practices and have received platitudiness crap from all three! No one seems prepared to do a bloody thing about them. It is high time that we, the Customers of these robbers, united and brought a class action using top class legal firm, against MEX (GMAC)/ Bradford & Bingley. We should organise a mortgage payments strike. If 100,000 borrowers all ceased payments at once and sued MEX what are MEX going to do about it - drag us all into Court and Repo the lot! Tell me what you all think.

Mark Alexander

7 years ago

Chris, take a look at what's being said over on the Property Tribes forum. It's really kicking off over there! http://propertytribes.ning.com/forum/topics/mortgage-express-new-policy

7 years ago

Read all this with interest, I have 2 MX B2L loans.

The situation is this. MX are state owned and their lending book is over exposed to buy to let and high risk self cert loans. The securitisation market where loans books are bought and sold dried up in the credit crunch.

Now government owned, MX want to dispose of their mortgage book, to repay the government. As we know they are not going to lend again, they have very unprofitable loans charged at low reversionary rates, mine at 2.25%

Any methods to reduce the risk to their overall lending book they consider reasonable.

Right of consolidation, in practice means that under 'all monies charges' MX can in the event of a sale hold all monies and use any surplus to repay another/other loans with them so reducing their 'overall' risk.

Any B2L borrower who has loans with Capital Home Loans (Irish Permanent and its successors) will have the same loan conditions. In the height of the property and lending boom no one really took much notice.

The press articles should really make clear and explain what they are actually proposing, it is unethical, but in the bigger picture they want to reduce their lending book, especially when most of us are paying them 1.75% over BBR which is costing them dearly, coupled with the fact many loans are in negative equity or not remortgagable for the same reason.

In February 2010 you will remember Skipton Building Society increasing the SVR from 3.5% to 4.95%, breaking their own special mortgage conditions whereby they would not charge more than 3% over BBR. There was an action group set up, and also the FSA afetr many complaints refused to get involved.

Bottom line is banks are now using any tactics to reduce risk/charge more. Buyer/borrower beware.

7 years ago

I have properties in Sheffield, Leeds, York and on the East Coast these all let to long standing tenants and none in anywhere near negative equity. 60% of my portfolio is with MX and the contracts were taken out for the maximum term. All are at reversion rates and are making me a good rental profit. Fortunately I don't foresee the need to sell any of my houses. So all that borrowing will stay with MX for at least another 15 years or until they make me an offer I can't refuse. MX can invent all the exit strategies they want but if they want me to move my borrowing early they will have to do it on my terms. At some point in the next 15 years they will have to have those loans paid off, if MX will give me 20% off the loans I will move them all tomorrow, but I can wait. Until then or until there are significant market changes MX can continue with their low interest loans to me.

Jamie M

5 years ago

Help!
I have a MX bod coming over for an account review! They are demanding a huge array of info from my entire portfolio, the 15 mortgages I have with them and the 19 mortgages I have with other lenders, why? They want evidence of everything I do make spend etc which has me worried about my own home. Does anyone know what their intent is and what they can take hold of should they insist i repay their mortgages most of which are in negative equity due to recessionary factors not my immaculate lending and payment habits? Many thanks

Jamie M

5 years ago

Help!
I have a MX bod coming over for an account review! They are demanding a huge array of info from my entire portfolio, the 15 mortgages I have with them and the 19 mortgages I have with other lenders, why? They want evidence of everything I do make spend etc which has me worried about my own home. Does anyone know what their intent is and what they can take hold of should they insist i repay their mortgages most of which are in negative equity due to recessionary factors not my immaculate lending and payment habits? Many thanks

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