Verso’s tracker plea
Eddie Smith, director of business development at Verso, said that problems over issues such as dual variable rates could be avoided if borrowers took out more loans linked directly to the base rate.
Smith said: “The financial services Ombudsman has now added Cheltenham and Gloucester (C&G) to the growing list of lenders whose customers have successfully filed complaints about dual mortgage pricing. C&G joins Halifax, Nationwide and HSBC, with a ruling on the first Abbey National complaint also due shortly.
“The practice of charging new customers a lower variable rate than those on capped rates, or coming off fixes was endemic among the mainstream lenders and, even despite the Ombudsman ruling against the practice, many of them are still continuing the practice.
“Mortgage advisers who have recommended these mortgages have so far not come under fire from the Ombudsman. However, many of them may not realise that each Ombudsman complaint form contains a section for the complainant to fill in the details of the adviser that recommended the product – so how long will it be before we see accusations of another major ‘mis-selling’ scandal being levelled at the mortgage adviser community?
“There are plenty of totally transparent products out there in the market, such as base rate trackers and rates tied to LIBOR – so I would recommend that advisers make sure they include such products within the range of choices they make to clients.”