Partially upheld: Mortgage administration / arrears handling complaint against Market Harborough Building Society

Decision detail

Summary

Mr L complained that Market Harborough Building Society treated him unfairly regarding his joint mortgage following separation from his ex-wife. He sought to switch to interest only but Market Harborough required both parties' consent and proof of property marketing. Although a court order required the ex-wife to cooperate with mortgage variations, Market Harborough imposed additional conditions. The ombudsman found the requirement for marketing evidence was unreasonable in these circumstances but upheld most of Market Harborough's earlier refusals as reasonable given the joint mortgage structure. No financial loss was established, and £400 compensation was awarded for distress and inconvenience during the delay period.

The Ombudsman's reasoning

While Market Harborough was entitled to require the ex-wife's consent as a joint mortgagor, it was unreasonable to insist on evidence of property marketing in these specific circumstances given Mr L's known financial difficulties and the court order. However, Mr L suffered no quantifiable financial loss by continuing to pay capital during the delay, and the ombudsman could not establish that delayed repairs prevented faster sale. Compensation is limited to distress and inconvenience during the two to three month delay period.

How this compares

Source

Read the original decision on the Financial Ombudsman Service website