Upheld: Service failures generally complaint against Fair Investment Company Limited

Decision detail

Summary

Mr H and his wife obtained bridging finance from Clifton Private Finance to purchase a new home while selling their existing property. Mr H complained about Clifton's service, claiming inadequate explanation of fees and processes, unclear disclosure of commission, double payment of broker's fees, and lack of support after his broker left the firm. The ombudsman upheld the complaint in part, finding that Clifton failed to explain the loan arrangements clearly and did not correct Mr H's documented misunderstandings despite having the opportunity to do so. However, the ombudsman rejected complaints about commission disclosure, double fees (which Mr H accepted he had not paid), and lack of support with the loan extension (which Mr H had not requested). The ombudsman ordered Clifton to pay £300 total compensation based on the stress and confusion caused by their service failures.

The Ombudsman's reasoning

The ombudsman found that Clifton had a duty to explain the bridging loan process and fees clearly to Mr H, who was an ordinary consumer lacking expertise in this area. Mr H's emails demonstrated misunderstandings about the loan arrangements (such as believing fees would be paid with monthly interest when no monthly payments were due), and Clifton had multiple opportunities to correct these misunderstandings but failed to do so. This failure contributed to Mr H's confusion and stress. The ombudsman rejected Mr H's other complaints: the commission arrangement was sufficiently clear, he did not pay the broker's fee twice (which Mr H later accepted), and he did not request Clifton's help with the loan extension. Compensation was assessed based on the impact of Clifton's failings on the consumer, not on the fees charged.

How this compares

Source

Read the original decision on the Financial Ombudsman Service website