A mortgage broker has been forced to write to customers to offer redress after admitting some clients may not have received suitable advice.
The Mortgage Matters Partnership, which is based in Altrincham, said it may not have fully considered the costs and implications of consolidating debts when advising customers on debt consolidation mortgages.
The firm admitted it may not have taken full account of other options such as debt management or insolvency arrangements, whether it was appropriate for clients to secure a previously unsecured loan, and the costs associated with extending the period of consolidated debt repayment.
Customers may have been affected by the failings between 1 January 2007 and 7 July 2014.
Debt consolidation mortgages enable borrowers to pay off debts from credit cards, store cards and other personal loans rolling them into one monthly payment at a lower interest rate.
But they are not guaranteed to save customer’s money, as borrowers could end up paying more to service their debt over a longer period.
Mortgage Matters Partnership will appoint a third party, agreed in advance with the FCA, to manage the redress programme work on its behalf.
The third party will establish a methodology for assessing the suitability of advice, establishing any customer detriment, calculating redress due, and delivering an appropriate and effective customer contact and redress programme.
Mortgage Matters Partnership will pass on any customer responses to the third party, which will assess if suitable advice was given and offer redress where appropriate.