Not upheld: Mortgage advice complaints complaint against Stonebridge Mortgage Solutions Ltd

Decision detail

Summary

Mr W complained that Stonebridge Mortgage Solutions Ltd incorrectly advised him to apply for a buy-to-let mortgage when he should have been advised to apply for a residential mortgage to purchase his mother's property. Mr W claimed Stonebridge knew his mother would remain in the property but advised him to proceed with the BTL application anyway. After the lender NWI withdrew the mortgage offer upon learning Mrs W would not vacate, Mr W sought compensation for expenses incurred. The ombudsman found that Mr W had initiated the BTL discussion, Stonebridge had explicitly stated vacant possession was required, and Mr W had led Stonebridge to believe his mother would enter residential care. Consequently, the complaint was not upheld, and Stonebridge's offer to refund the £750 broker fee was left for Mr W to accept or reject.

The Ombudsman's reasoning

The ombudsman found that Mr W, not Stonebridge, first raised the question of a BTL mortgage. Email evidence clearly shows Stonebridge made explicit statements in July 2018 that a BTL mortgage could only proceed with vacant possession of the property. Mr W led Stonebridge to believe Mrs W would be vacating and entering residential care. Consequently, there was nothing to alert Stonebridge that Mrs W would remain in occupation, and no scenario that would have triggered the need for advice about family members living in BTL properties. Mr W's own May 2020 email acknowledged the BTL application was on the basis of vacant possession in accordance with Stonebridge's advice. Therefore, Stonebridge cannot fairly be held responsible for expenses incurred after NWI withdrew the offer upon learning Mrs W would remain in occupation.

How this compares

Source

Read the original decision on the Financial Ombudsman Service website