Over 1,000 people have registered an interest in the Class Action groups challenging the legality of the increases to tracker mortgage interest rate margins proposed/implemented by West Bromwich and Bank of Ireland. Many of the people who have registered are not affected at this time but are sufficiently concerned about the potential knock on effects to the attitudes of other lenders to make a donation to the Class Action Marketing Fund. We must spread the word to ensure that we win these cases in order to to discourage other mortgage lenders from following suit.
Funds raised towards the legal fighting fund are being held in a solicitors client account which complies fully with The Law Society rules and is protected by client money protection insurance and the solicitors compensation fund until they are billed. The objective is to raise sufficient money to be in a position to fund group action court cases and associated legal expenses insurance. No court cases will begin until such time as sufficient funds are raised to protect and limit the liabilities of all participants to the amount of funds contributed up front. If Court cases are not required or are not affordable then any surplus funds held on account will be returned pro-rata to the members of each group.
Existing supporters of the Class Action campaign are to be congratulated for their efforts to date.
If you wish to get involved please see the To-Do list below.
Complete the Class Action Expression of Interest Form – Link here You will then receive emails advising you what to do next.
Write to your local MP – find your local MP via this link several MP’s have already referred this matter to the chancellor of the exchequer or the chairman of the treasury select committee. The more support the better so we need everybody to write.
On these grounds we have raised more than enough money to cover the initial legal work and the costs of obtaining Counsels opinion. In fact, after taking these costs out of the funds raised to date we are 27% towards our minimum target fund raising to commence litigation. Now I don’t know about you but if Counsels opinion is that we have a VERY strong case I would definitely consider paying a lot more than I’ve paid already to take this all the way. £240 a case is a tiny fraction of what we all stand to lose, not just in terms of this lender but possibly others too.
In a months time we will have Counsels opinion. These are the scenario’s I have considered.
1) Worst case scenario is that we will be advised that we do not have a case. If that happens, costs to date will be taken from the funds raised and we will all get a refund pro-rata.
2) We are advised that we have a good case but we do not have enough money in the pot to fight it. We will then have to set a closing date for the fund and have a vote amongst members on how much they are prepared to pay if necessary. I suggest a pledge of up to one years worth of savings because if we start trying to set amounts we could be going back and forth forever more if people decide they are are in at one level and out at another. If we still don’t have enough money pledged at the end of such an exercise then it’s possibly game over, i.e. contributions are refunded net of expenses to all named borrowers.
3) We have enough money in the pot and counsels opinion is that we should fight.
In our opinion, we are more likely to raise the required funds on this basis.
We have a moral duty to do what is right for those who support the values upon which we started this campaign in the first place. Our promise to all who support these values is that we will not sell out on you at any price. We will continue to fight this injustice and we will fight any other lender who tries to follow suit.
We appointed solicitors to consider the actions of the West Bromwich BS tracker mortgage hike in interest rate margins at the beginning of October. Well over 100 affected borrowers have sent their papers and fees to the solicitor representing the group.
The solicitor acting for the group has been asked NOT to commit chargeable time to respond to individual telephone calls and emails from affected borrowers, this is to preserve funds. All questions should be raised via the Property118 forums to prevent duplication of efforts.
Around £15,000 of the funds raised to date will be used to complete the following steps. The balance will be held towards a Court action fighting fund, the target for which is £100,000 plus.
The solicitor acting will provide template letters for all paid up members to send to the solicitors who acted in the transaction. This letter will advise the solicitors to put their PI insurers on notice and also ask the solicitors to comment on why they did not offer advice on the clauses now being used by West Bromwich BS.
A further template letter for affected borrowers to submit as a follow up to initial complaints to the Financial Ombudsman service will also be prepared by the solicitors acting for the group and will be based on counsels opinion. There is no rush to do this, we have up to six months, hence the decision to await Counsels opinion in respect of the best possible legal arguments to present.
The solicitor acting on behalf of the group has already sent a letter to Andrew Tyrie MP, Chairman of the Treasury Select Committee. A response is awaited.
The solicitor acting on behalf of the group will submit formal complaints to the Financial Conduct Authority and the Financial Ombudsman Service once Counsels opinion has been received. A further complaint may be submitted to the Advertising Standards Authority dependent upon counsels advice.
More pressure needs to be put on the Financial Conduct Authority to obtain their own independent advice as to the legality of the actions already implemented by the Bank of Ireland. They received our barristers opinion, sent it to BoI who obtained comment from their QC and then decided to do nothing further. Our solicitor is of the opinion that the FCA response was a “whitewash” as they did not seek their own independent advice prior to making a decision. The more noise we can make about this the better as we need them to reconsider their position. Pressure is intensifying from the Treasury Select committee to lean on the FCA as more MP’s get embroiled in the debate following complaints from their constituents. Fundraising will recommence in due course, in the meantime, a QC working at the same chambers as the barrister we instructed has volunteered to review the opinion of our barrister and the responses from the FCA and the Bank of Ireland.
Fees applicable to the Bank of Ireland Class action are likely to be £240 per property, less any fees paid to date. We will advise you when the fundraising re-commences. Our objective is to significantly increase the numbers of interested parties before fund raising recommences. We are quietly confident that the promotional activities described in this update article will increase the numbers of interested participants.
The Financial Ombudsman Service are yet to make a decision based on the formal complaint regarding the actions of Bank of Ireland. It has been 7 months now since the FOS opened this case and their are still pontificating how to deal with it. If you believe this is an unacceptable delay the address to write to is The Financial Ombudsman Service, South Quay Plaza, 183 Marsh Wall, London E14 9SR.
Preference remains to persuade a regulator to take the cases to Court as this will significantly reduce costs to affected borrowers.
Disclosure – in group legal action cases it is normal for both sides to be aware of each others legal arguments before a Court case commences. Therefore, there is no risk to debating legal points in open forum. There is, however, a positive upside in that it continues to provide media with new stories and people to contact for case studies. Exposure is what we need to build the group.
The purpose of the marketing fund is to increase awareness of the campaign. This fund is held separately to the Class Action legal fighting fund which is held in a solicitors client account protected by client money protection insurance. The marketing fund is administered by Innovative Landlord Solutions LLP which is the owner of Property118.com.
Initiatives funded so far include sending letters to a database of mortgage brokers and financial advisers. The database was rented from Equifax and we chose to send letters as opposed to emails in order to guarantee delivery. We have also completed significant Search Engine Optimisation to make it easier for people surfing the internet to learn about our campaigns.
A Press Conference, open to paid up members of the Class action Group, and those who have contributed to the marketing fund, will be organised shortly after we have receive Counsels opinion on the West Brom case and the QC’s opinion in respect of our submission of the BoI case to the FCA, their response and the BoI’s QC’s response to the FCA. All responses are anticipated to be received towards the end of November with the Press Conference being held in London shortly thereafter. Surplus funds in the marketing fund, which are still continuing to flow in nicely, are being held towards this event. Funds raised since our first call for donations to a Marketing Fund on 3rd October are now approaching £4,000 of which £3,375 has been utilised to date.
We have done some research and we are able to contact in the region of 230,000 to 420,000 people via Facebook for a budget of £800. These will be friends of friends of people who have “Liked” the Property118 Facebook page. On the basis that people socialise with like minded people this could be an excellent target audience.
The beauty of this type of advertising is that we can add credit to reach more people as and when we receive donations.
All comments via the main discussion threads please.
If you haven’t already signed up please completed the form below.
As you will be aware, we are actively looking for a suitable course of action to oppose the planned increase in the interest rate charged on your mortgage by West Bromwich Building Society (WBBS).
We need to establish the exact conditions and legal arguments WBBS is using to justify the increase. The first thing we are doing is writing a letter on behalf of everyone who has contacted us to ask WBBS this question. In particular, whilst we have seen a sample offer letter which of course makes no reference to the ability to increase the interest rate in the manner they are proposing to do, we have seen their terms and conditions which does include this term (however vague it may be). We need to understand the basis under which WBBS believes those terms are incorporated into the mortgage contract.
We also need a complete set of documentation which would include any promotional material you may have from WBBS, the completed application form, the key features document, the mortgage offer letter and any other document you have received on the grant of the mortgage. We would also like to know how many investment properties you owned at the time you took out your mortgage. This may be helpful in countering any arguments regarding your status as a consumer or professional borrower. If you have not retained copies of all of this documentation please send us copies of everything you have.
Once we have this response from WBBS and a full set of documentation, we will instruct a barrister to provide us with a legal opinion on the merits of pursuing a legal action against WBBS to prevent them from imposing this increase. There are a number of legal remedies available and we will identify the most suitable ones to pursue. We are also considering the merits of providing a template claim form and particulars of claim to allow you a cost effective way of bringing a claim against WBBS in the small claims court.
At the same time, we will prepare a template letter for you to send to your solicitor who acted for you on the loan. At the time you took out your loan, your solicitor would have had a duty to report a term as significant as the one WBBS is relying upon to you and you may have a negligence claim against them. The letter will ask them to put their insurers on notice with regards to the potential claim. We will also provide you with a template complaint form to lodge your complaint with the Financial Ombudsman Service.
Following receipt of the advice from the barrister we will start the appropriate action.
Obviously all of the above costs money. Our budget for steps 1 – 4 above will be in the region of £15,000. We will therefore be seeking a payment from you of £240 to cover steps 1 – 4. Any excess funds received will be used to fund Step 5. If you have more than one loan from WBBS then this sum is payable per loan.
We will have a better idea of the cost of step 5 once we have received the barrister’s advice. The cost to you will depend on how many people sign up – obviously the more there are, the less it will cost each of you.
Complete and return our instruction form (download here) together with copies of two pieces of identification for you.
Pay the sum of £240 into our client account. Details as follows: Account Name: The Law Department Client Account, Account Number: 06658997, Sort Code: 12 24 82. Alternatively, you may also send a cheque accompanying the papers referred to above. Cheques should be payable to The Law Department Client Account.
Upon receipt of all of the above, you will receive an acknowledgement from us and the template letters. We will update the Property118 forum regularly with timelines as to when we expect to receive the advice from the barrister.
The Law Department is regulated by the Solicitors Regulation Authority (SRA number 441085). The Principal is Justin Selig who is a solicitor regulated by the Solicitors Regulation Authority.
My problem is that the yearly service charge is now just under £2,000 pa not including ground rent. I have flats else where and I’m paying approx £1,000 pa service charge on average so I’m getting increasingly frustrated by this £2,000 service charge. When I question the management company they just fob me off with excuses like oh the landscaping budget has gone up or the insurance has gone up blah blah blah!!!! I have had several rows with the management company about the quality of there works so the fact that I also think I’m being ripped off is very frustrating. Getting rid of them would be ideal but I do not have the knowledge, time or patience to contact and then get together with the other residents and form a RTM etc… Is there something a bit easier and quicker I can do to get this management company in check, I’ve heard about Leasehold valuation tribunals but is that the correct route for this problem and can anyone tell me how it works?
Or is there a quick way of just just simply sacking them and getting another management company in, I always thought the management company was employed by the freeholder so would that be a job of the freeholder?
Forget double-glazing, a friendly landlord, and room to swing a cat. What’s really important in Britain’s 2 million flat and house shares?
In addition, SpareRoom research of more than 1,000 room seekers reveals that almost a third (32%) think people are the most important element of a flat or house share, with just one in ten (9%) saying the property itself is their main consideration. Almost six in 10 (59%) say both the people and the property are equally important to them.
“Flatsharing is all about people – who you live with is how you live. The sheer amount of searches related to the personalities, lifestyles and preferences of future flatmates shows just how important it is to get on with and like the people you live with. For many, that means finding flatmates with similar hobbies or lifestyles or shared backgrounds.
“As more people cotton on to the affordability and social advantages of flatsharing, it really is gaining popularity. We’ve seen flatsharer figures rise by almost a third in just two years and our research shows that half of flatsharers are returning to shared accommodation after renting solo or with a partner – many in a bid to save deposits to get onto the property ladder sooner.
The National Audit Office has crticised Universal Credit welfare reforms as being badly managed, overambitious and poor value for money including £34 million written off on failed IT.
The spending watchdog said “risks were taken with the universal credit to hit targets, IT systems had limited functionality and an unfamiliar project management approach was used”.
These IT issues have delayed the introduction of Universal Credit although Ian Duncan Smith has confirmed the problems are now fixed and will be delivered within budget and timescales.
The report said there was still potential for universal credit to bring about “considerable benefits” if the department put “realistic plans and strong discipline in place”.
Expenditure on IT systems has accounted for more than 70% of the £425m spent to date but the report could not confirm if the infrastructure in place will support a national roll out.
Universal Credit has been hotly debated by readers in Property118 and widely condemned as a bad idea, by not making housing benefits directly payable to Landlords and in the trial areas used so far has resulted in a substantial increases in rent arrears.
Earlier this year we spotted an opportunity to set up a buy to let Estate Agency. However, due to lack of resource (time) very little has been done other than a dozen or so sales on behalf of developers, plus setting ourselves up with The Property Ombudsman Service and organising Professional Indemnity insurance to keep ourselves legal of course.
The reason we haven’t got around to growing the buy to let Estate Agency business is that our passion is facilitating the sharing of best practice amongst landlords and letting agents on the Property118 forum which I set up just over two years ago. Prior to that I was a commercial finance broker and I’ve been a landlord since 1989.
The opportunity is a very simple one. Nearly 200,000 landlords and associated professionals subscribe to our daily newsletters and engage on the Property118 forum. Some of these people are no doubt in the market to buy more property. It occurred to us that most properties are sold with vacant possession, however, for landlords that can be a bit of a nightmare as both the vendor and the purchaser both experience costly void periods.
As we haven’t got time to source properties to sell, never mind to prepare sales particulars, do floor plans, arrange viewings and progress chase offers through to completion, our idea is to work on a split commission basis with other agents.
We will showcase properties on the Property118 forum and link to them in the daily Newsletters. Enquirers will be landlords who may well already own properties in the area, hence for agents who partner with us on this venture, all referrals will be good leads for future sales and letting opportunities as well as prospective purchasers of the property which is being marketed.
This information, together with an indicative financing quotation will enable us to calculate not only rental yields but the cash on cash equivalent annual returns after all costs including mortgage, insurance, lettings and management, a sensible maintenance budget and where appropriate any ground rents or service charges. This will enable investors to compare cashflow returns on their money to the returns they are currently receiving elsewhere on their investments. The potential for capital growth is obviously a primary reason for people to invest into property too of course.
We will not allow this activity to overwhelm what we do here at Property118, therefore, we will cherry pick the properties we want to promote based on those which we believe make sense to buy as investments.
It is unlikely that we will be in a position to accept instructions directly from landlords to sell their properties due to the lack of infrastructure to provide a sufficiently professional service, i.e. floor plans, viewings, for sale signs etc. Therefore, any such enquiries will be referred back to the agencies we end up partnering with. Landlords are, of course, also welcome to introduce us to any agencies they are already working with as we will not get tied into any exclusive contracts. Our independence is vitally important to us.
I would like to have a chat with any agents who see some mileage in this opportunity. I have some ideas on splitting commissions but I am very open minded at this stage as the project is very much in its infancy.
If you would like to chat please comment below, email me – mark@property118.com or call me on 07834 754 223.
It’s time for me to share some controversial views on why I believe landlord licensing to be a pointless exercise I think.
Now don’t get me wrong, I hate the fact that a very small minority of bad landlords have earned our profession a bad reputation. However, it appears they might be a necessary evil too.
We are hearing reports coming in suggesting that David Cameron’s “Major Projects Authority” may have given Universal Credit reforms a Red Light warning.
A landlord from Bracknell, Berkshire, has spoken out about her nightmare ordeal after her housing benefit tenant failed to pass on the payments. This issue has been widely reported and discussed within the buy-to-let industry but now a landlord has come out publicly to talk about it. The non-payments left Mrs Trivedy and her self-employed partner in an extremely difficult financial position. As a result of the welfare reforms and implementation of Universal Credit thousands of ordinary landlords fear that they will see more of this kind of problem. It is expected to affect the whole country and BBC1 are covering the issue on The One Show tonight, Thursday 2nd May at 7pm. They will feature Mrs Trivedy and Landlord Action, the problem tenant specialists, who she went to for help.
After meeting her current partner, Mrs Trivedy decided to sell her four bedroom house in Bracknell from a previous relationship so that they could buy somewhere together. After failing to sell the property quickly enough, she took the decision to let it out, which for three and half years provided the perfect solution. When her previous tenants moved out and an acquaintance from her daughter’s school, with five children of her own, expressed an interest in the property, it seemed like the perfect solution. The prospective tenants explained that they had fallen on tough times but that the £1,200 housing benefit they were due to start receiving would cover the rent. They agreed to set up a direct debit straight to Mrs Trivedy’s account.
From the moment the family moved in (December 2011), the payments were not consistent and with the housing benefit being paid in arrears every two weeks, there was already a shortfall of £20 per month which the tenants were supposed to make up. Four months ago, the payments stopped altogether. On communication with the tenants, Mrs Trivedy was told to liaise with the local housing allowance office, to no avail. After attempting to speak to the tenants at the property to discuss the issues and try to work out a payment schedule, the tenants called the police to file a harassment case. Mrs Trivedy has since received abusive text messages from the tenants via her mobile phone. In desperation, Mrs Trivedy called on the help of Landlord Action who have since issued a Section 8 possession notice, the process of which was filmed by The One Show.