Treating Customers Fairly (TCF)

Mis-sold Mortgage Free Compensation Claim Test

Mis sold mortgage advice and the Financial Services Authority (FSA)

The Financial Services Authority (FSA) has set out guidelines for Treating Customers Fairly which should be at the heart of a mortgage and financial advice business and considered in every aspect of a recommendation. These guidelines apply to financial advisers, mortgage brokers and insurance intermediaries. However most of these examples will sit across all three business types. Breaches of these rules could lead to a mis-sold mortgage claim.

The Financial Services Authority have outlined six consumer outcomes it would like to see all firms moving towards when supplying advice to consumers on a broad range of financial products, including mortgages. They are:

  1. Consumers can be confident that they are dealing with firms where the fair treatment of consumers is central to the corporate culture
  2. Products and services sold are designed to meet the needs of the customer
  3. Consumers are provided with clear information and are kept appropriately informed before, during and after the sale of a mortgage
  4. Where consumers receive advice, the advice is suitable and takes account of their circumstances
  5. Mortgage applicants are provided with products that perform as firms have led them to expect
  6. Consumers do not face unreasonable post-sale barriers imposed by firms to change product, switch provider, submit a claim or make a complaint.

These are examples of what are considered good practice they are by no means an exhaustive list as all firms operate in different ways – from their size to the complexity of product and type of business they undertake – but they should demonstrate how the consumer is treated fairly at all times.

If you are being advsed on a mortgage the FSA has detailed the sales process to make sure consumers know what they are buying. Sales advice process;

  • Have you discussed several product options with the customer or just one?
  • If providing advice, have you completed a detailed Fact Find?
  • Have you established your customer’s attitude to risk as part of your Fact Find?
  • Are you satisfied that your customer can afford the product now and in the foreseeable future?
  • Have you given the customer the ‘Keyfacts about our mortgage service’ (IDD) document?
  • Have you provided the ‘Keyfacts about this mortgage’ or ‘KFI’?
  • Are the above Keyfacts documents accurate and complete?
  • Have you asked the customer whether they understand the documents you’ve provided?
  • Are you satisfied that the customer understands the benefits and risks of the product they’re buying from the lender and the associated costs?
  • Are you satisfied that your customer agreements are clear and understood?

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