The policy came to light when Tony Kirbell, a Woking-based franchisee of national brokerage Mortgageforce, was told by Abbey that a three-year stepped fixed product it had offered his client was no longer compliant.
Although the case should have gone through prior to ‘Mortgage Day’ it was delayed until 4 November.
Kirbell was then informed the product was unavailable, only for both he and the client to then receive a mortgage offer anyway.
“The client was naturally delighted that her mortgage had been approved, but I then had the difficult task of explaining that Abbey would not be honouring the offer,” he said.
“Abbey had not made it clear to me that the case had to complete before 31 October’” he added.
Kirbell remonstrated with Abbey and the lender decided to offer his client a two-year stepped fix, which he believes to be a better product. It said it would also provide the client with financial compensation.
He urged other brokers who found themselves in a similar position to insist on recompense from the lender in question.
Abbey spokesperson, Helen Tochel, said: “Where a product was chosen by a customer and is now no longer available we will offer a similar alternative, in some cases we may offer a better rate.
“In cases where customers find themselves financially disadvantaged we will assess suitable compensation for them.”
Rob Clifford, managing director of Mortgageforce, commented: “If some of the biggest lenders in the land are having difficulties just imagine the strain that some small lenders and building societies are under.”
He added: “This case was clearly more than just an administrative mistake on the part of the Abbey.”
