Not upheld: Mortgage advice complaints complaint against Prudential Lifetime Mortgages Limited

Decision detail

Summary

Mr P1, as executor of his late brother's estate, complained that Prudential mis-sold a lifetime mortgage to Mr P in 2009 for approximately £13,500 to purchase a car. Mr P1 argued that Mr P was vulnerable and could have used his £25,000 in savings or taken a short-term loan instead. Prudential maintained that it had advised Mr P to use his savings but that Mr P chose to retain them despite warnings about higher long-term costs, and that Mr P had no spare income for alternative borrowing and did not wish to downsize. The ombudsman found the complaint not upheld, determining that Prudential obtained relevant information, understood Mr P's objectives and preferences, made a suitable recommendation, and that Mr P had capacity to make his own decisions even if they later proved unwise.

The Ombudsman's reasoning

The ombudsman found that Prudential complied with mortgage regulation requirements by obtaining relevant information about Mr P's circumstances, understanding his objectives, and making a suitable recommendation. Although Mr P had savings available, he explicitly chose not to use them despite being warned of the cost implications. Mr P had no spare income for alternative borrowing and did not wish to downsize. The ombudsman was satisfied that Mr P had capacity to make his own decisions, even if those decisions later proved unwise, and that Prudential adequately explained the benefits and disadvantages of the lifetime mortgage.

How this compares

Source

Read the original decision on the Financial Ombudsman Service website