My client is stuck between Rock and hard place

My client is an existing Northern Rock customer who wished to port her flexible fixed rate deal to avoid a 3% early repayment charge. The product is competitive at 5.69%.

I submitted a decision in principle request to Northern Rock on 30 October 2008, which was accepted at 90% LTV.

My client subsequently offered to purchase a property and following legal negotiations the purchase price was agreed on November 18.

I immediately requested a specific Key Facts Illustration from Northern Rock, only to be told that its maximum LTV had been reduced to 85% from November 17.

This came without warning and despite my efforts to appeal the lender would not budge one inch.

My customer is now in the precarious position of having to find a further 5%. Had she known about the criteria change when the DIP was submitted she would have reconsidered the purchase.

She could look around for 90% LTV deals elsewhere but they are a no go in the current climate.

Even if she did manage it she would certainly have to pay fees, which would hit her where it really hurts – the pocket.

Surely Northern Rock should honour existing DIPs? This really is treating customers unfairly.

Michael Gillis

Independent Mortgage Adviser

Fife