Yorkshire and Clydesdale banks miscalculate 18,000 mortgages
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Yorkshire and Clydesdale banks have nearly finished apologising to 18,000 variable rate customers after an error meant they were underpaying on their mortgage.
After miscalculating monthly payments some customers were paying less than the minimum meaning many now have a shortfall on their mortgage.
The shortfall means many are not on course to pay off their mortgage in the agreed term.
The banks claim they have corrected the error and have written to affected customers to apologise and suggested ways to return their accounts to the position they would have been in had this not occurred.
Steve Reid, retail director for Clydesdale Bank, says: “First and foremost we are very sorry that this error has happened and for any inconvenience it may have caused those customers affected.
“We would like to reassure mortgage customers that they need take no action unless they have received a letter from us. The vast majority of our customers are not affected and, of those that are, 99% have already received their letter advising them of the specific impact on their account. The other 1% will hear from us in the next couple of weeks advising them of options to bring their account back on track.”
The new regular payments, suggested to customers in their individual letter, reflect the correct monthly payment, plus an amount to eliminate any shortfall caused by the previous underpayments.
For around half of the customers who have been underpaying the total suggested increase is less than £25 a month with around £2 to cover the shortfall.
The banks are also providing other flexible options, with each customer’s case being reviewed individually so that their full circumstances can be assessed and the most appropriate solution found.
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Readers' comments (7)
Steve Wentworth | 21 Jul 2010 11:34 am
TCF at it's core
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Steven Woodcock | 21 Jul 2010 12:03 pm
No offer to make up the shortfall as a goodwill measure?
I'm sure an adviser wouldn't get away so lightly if they made an error.
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C. Macdonald | 21 Jul 2010 12:37 pm
I think all of those affected should complain vigorously to the lender as its their mistake. I am sure that 18,000 complaints to the bank followed up by 18,000 to the Ombudsman, may ensure that the lenders look at their response again. Is it not £500 per case that a bank has to pay to the Ombudsman for every case they look at? So may be worth Yorkshire and Clydesdale doing a bit of negotiating with their customers because £9,000,000 would be better with them, than with the Ombudsman?
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Peter Gladdy | 21 Jul 2010 4:58 pm
Mistakes happen - if the lender had overcharged there would be an outcry and they would be immediately expected to quite rightly reimburse their borrowers so if they have innocently undercarged why should they not expect their borrowers to repay. The majority of borrowers will have known that they have been undercharged but if there are any cases where there is GENUINE hardship caused I am sure the lender will work with the borrower to mitigate.
Yes, I agree that brokers are receiving the brunt end of the stick at the momment but that is no reason to penalise lenders for every mistake made. guys, at the end of the day - no lenders no brokers
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Anonymous | 21 Jul 2010 6:21 pm
If an Independent mortgage adviser had made such a massive error we all know the FSA would have pulled their permissions pronto! Where's the FSA comment on the back of this and on the back of TCF? Yorkshire BS should have corrected the mistake out of their own pocket as a gesture of goodwill - if it was me I would be complaining to the highest order.
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Anonymous | 22 Jul 2010 10:19 am
if i was a customer that had been effected I would complaine to the bank first , that it was not my fault and any shortfall should be covered by them , if they refuse , then go to the FINANCIAL OMBUDSMAN!!!!!
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Anonymous | 24 Jul 2010 5:12 pm
Thie is in Response to Mr Peter Gladdys coment - I wonder if your response would be the same if you like me had now to pay an extra £200/month on top of oweing them £3600 in underpayments, this is gone on over a period of 26months for us without us even realising what was going on, infact if the truth be known we actually queried the rate/amount and were told that everything was fine. Like many other people in this country we take what they say as gospel and unless you are clued up on financial goings on you depend on them being right.
If I made a mistake at my work I would be held responsible, end of story, so see no reason why this should be the same, especially as this was not done through a broker but with the branch Mortgage Adviser direct.
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