Not upheld: Mortgage advice complaints complaint against J P Mortgages Independent Mortgage Brokers

Decision detail

Summary

Mr and Mrs T complained that JP Mortgages recommended an unsuitable non-prime interest-only mortgage in 2005 when they re-mortgaged and consolidated debts. The complainants argued they were not in financial difficulty and that the mortgage was inappropriate given their circumstances. The ombudsman found the recommendation was suitable because the complainants' poor credit history restricted their mortgage options, they could not afford a repayment mortgage on their budget, and their stated plan to sell the property was plausible and recorded. The complaint was not upheld.

The Ombudsman's reasoning

The ombudsman found that Mr and Mrs T's credit history was likely to restrict their mortgage choices, making a non-prime lender necessary. Given their circumstances (poor credit, self-certified income, inability to afford a repayment mortgage on their £400 monthly budget), the interest-only mortgage was the most suitable option available. The implications of the interest-only mortgage were communicated to them, and their stated intention to sell the property to repay the loan was plausible and recorded by the adviser.

How this compares

Source

Read the original decision on the Financial Ombudsman Service website