Questions Of Cash: 'Loan error left me with a bathroom in my shed'


Q. My husband and I applied for a further advance on our mortgage with the Nationwide earlier this year. The fee for this was taken from our account on 25 April. The advance was to allow us to replace one of our bathrooms, pay for a new car under the scrappage scheme, and clear our overdraft and a credit card. We had been told we could borrow up to £131,000, but we only wanted £25,000.

However, errors by Nationwide mean we are without any money. We were told that the money would be transferred into our account within 48 hours of 4 June. To obtain a discount offered by the manufacturer of the bathroom, we ordered it in May, and to secure a vehicle under the scrappage scheme we paid a £500 deposit. The bathroom has been gutted, ready for the new suite – which is still sitting in our shed. Nationwide says that because we spent a lot of money recently it will not extend our overdraft. It's now over 11 weeks since we started this process and we seem no further forward. SB, by email.

A.There was a lot of confusion here. Nationwide says the figure of £131,000 was the maximum available based on income. However, the lending limit on a secured loan is also related to the value of the property. A loan application can proceed initially on the basis of the income being acceptable, but Nationwide will not approve the loan until it is clear that there is sufficient equity available in the property to secure the loan, based on a maximum loan-to-value ratio of 85 per cent. This provided a limit in your situation of £24,276.

There was a further complication because you already have both a mortgage with Nationwide and a second charge on the property with Barclays. Nationwide says that, legally, to process your loan it must be allocated the second charge. To enable this to happen, Barclays must issue a letter of postponement – through which it gives Nationwide the second charge and itself takes the third charge on the property. Nationwide accepts that it failed to make this situation clear to you when you made your application.

Further delays were caused by Barclays initially declining to issue a letter of postponement, because its valuer did not accept Nationwide's valuation of the property in current market conditions. This was resolved when you agreed to reduce the value of the requested loan. Barclays has now agreed to issue a letter of postponement and Nationwide has agreed to process the loan urgently when this is received. Nationwide has also agreed to pay you £649 in compensation – the amount you specified as the minimum you would accept – for your distress and time in dealing with the problems, recognising that it did not handle the application properly.

Q. I've been trying to get a refund from thetrainline.com since 5 May. I keep getting the same response from their call centre that the refund was authorised on 5 June. I've now sent about ten emails and made numerous phone calls. I've even sent them a Guaranteed Next Day Delivery letter with all copy correspondence. I don't even get an acknowledgement email. DS, Bury.

A. Regular readers will know that others have had similar experiences. Thetrainline.com has now processed the refund of £84.50, plus £30 as a goodwill payment. It apologises for the delay.

Q. I have a stocks and shares ISA with Halifax. Whenever I buy or sell shares, the monies are taken from my Nationwide Flex account. The monthly management fee is also taken from this account. I elected to take up my full entitlement and the only stipulation was that I should have sufficient cleared funds in my account. As I normally made all my purchases through the linked bank account, I assumed that having sufficient cleared funds in that account was sufficient. But I was allocated zero shares.

Halifax told me this was different to other transactions and the money should have been in the actual Shares ISA account and that this was made clear in the offer. I re-read this and don't agree. There is a reference to "any monies will be debited via your stocks and shares ISA", which to me means "by way of". There is no plain reference anywhere to this being different to any other transaction – and why should it be? I don't feel the letters and conversations from Halifax properly deal with my complaint. TC, by email.

A. Halifax insists that its communications were unambiguous and that it is not to blame for your confusion. But it is offering to buy shares for you, commission-free, as an alternative.

Q. I recently booked a flight for my daughter to go to Madrid with British Airways (BA). She is 16 years old and does not have a bank card, so I used my Visa card to pay. I assumed that there would be an automatic question to request the name of the traveller as I said the cardholder was not travelling, but this never came up. I then phoned BA to check and was told I had missed a question asking for the name of the traveller. I can't check that, but even if I did make a mistake, surely the website should not have accepted my booking? I must now pay £30 to put my daughter's name on her ticket. BD, London.

A. BA insists the problem is with you, not them. Its spokesman says: "I think that he simply did not follow the correct procedure when booking the ticket. You cannot proceed to the payment stage unless you choose either 'Yes' or 'No' from the section 'Travel details of person paying'... There is no way that a ticket can be issued without these details being entered, hence I'm afraid that the error was on his part and we cannot refund the £30 charge."

Questions of Cash cannot give individual advice. But if you have a financial dilemma, we'll do our best to help. Please email us at: questionsofcash@independent.co.uk

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