MortgagesAug 5 2015

Adviser complains of ageism over Nationwide loan

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Adviser complains of ageism over Nationwide loan

A financial adviser has complained of ageism in the mortgage application process, claiming Nationwide Building Society had dictated when he should retire.

Dennis Hall, the chief executive of London-based Yellowtail Financial Planning, applied to the Swindon-based mutual for a fixed-rate mortgage with an 85 per cent LTV, giving 70 as the age at which he expected to pay off the mortgage.

He was asked how he intended to repay the mortgage past his retirement age, assuming a state retirement age of 66. He was then told over the phone that the mortgage application would be rejected on the grounds that he wanted to pay it off when he was 70.

Mr Hall, who has been a financial adviser for around 30 years, said he had “no problem” with Nationwide refusing his application but objected to the mutual “dictating” when he should retire.

Mr Hall, 56, said: “It has been a difficult mortgage company to work with. The final straw came when it asked me how I was going to meet the mortgage repayments after age 66.

“I do not have to retire at that age. I do not want to retire at that age, and even if I did stop working, I would either sell my business, or draw dividends from it by having other people continue to work in it.”

Financial Adviser put in a call on 3 August to Nationwide about the case. On Tuesday 4 August Mr Hall said he received a phone call, saying that Nationwide has now processed his case manually.

Right to reply

A spokesman for Nationwide said: “Under the MMR rules the full detail of the income that the customer will rely on after retirement must be assessed if their application is made close to retirement.

“Mr Hall’s mortgage broker had claimed he and his partner had no post-retirement income and could not provide proof of the investment income.

“However, when the case was reviewed by our specialist underwriting team it ascertained it was plausible that Mr Hall could continue to earn his current salary till the end of the mortgage term. As a result he now meets our mortgage affordability criteria, and we are able to offer him a mortgage.”

Background

Last month the Financial Ombudsman Service warned of a “box-ticking” mentality in the mortgage industry following last year’s introduction of MMR, warning that lenders have been applying rules too rigidly.

Fos said that when MMR was introduced it had just seen a record year for mortgage complaints, but a year on these complaints remain at a historic high.