Partially upheld: Other regulated complaint complaint against United Trust Bank Limited
Financial Ombudsman decision DRN-5466188 of 2025-04-08T00:00:00+00:00. Other regulated complaint complaint against United Trust Bank Limited. Outcome: Partially upheld.
Decision detail
| Reference | DRN-5466188 |
|---|---|
| Decision date | 2025-04-08T00:00:00+00:00 |
| Firm | United Trust Bank Limited |
| Product | Other regulated product |
| Claim type | Other regulated complaint |
| Outcome | Partially upheld |
| Remedy | UTB directed to: (1) re-work the bridging loan account to reflect repayment on 18 April 2024 (42 days after offer issuance); (2) pay redress calculated as A-B+C where A equals the difference between re-worked and actual redemption figures, B equals additional interest on Mrs L's replacement borrowing for the 42-day period, and C equals 8% simple interest per annum on A-B from 30 May 2024 to settlement; (3) reimburse abortive costs of £2,250 for legal work and £4,129 for insurance, plus 8% simple interest per annum from respective payment dates; (4) pay £350 compensation for time, trouble and upset. If A-B+C results in a negative figure, no redress is due but compensation and cost reimbursement remain payable. |
Summary
Mrs and Mr L complained to the FOS about United Trust Bank Limited regarding a bridging loan and subsequent refinancing offer. They argued the bridging loan was misrepresented as unregulated when it should have been regulated, and that UTB unfairly withdrew a refinancing/refurbishment loan offer after issuing it. The ombudsman found that the bridging loan was properly offered as unregulated since 26K was acquired as an investment property, not as the borrowers' residence. However, the ombudsman upheld the complaint regarding the unfair withdrawal of the refinancing offer, determining that UTB should have reviewed the CIL application (which indicated possible occupancy) before issuing the offer on 19 July 2023, as it was available via a link provided in April 2023. The withdrawal was based on information that existed at offer issuance, not new information, making it unfair. UTB was directed to provide redress based on a 42-day period and reimburse abortive costs totalling £6,379 plus interest and £350 compensation.
The Ombudsman's reasoning
The ombudsman found that the bridging loan was properly offered on an unregulated basis as Mrs and Mr L acquired 26K as an investment opportunity, not as their main residence. However, regarding the refinancing offer withdrawal, the ombudsman determined that UTB acted unfairly. Although the CIL application provided evidence that Mrs and Mr L may have contemplated occupying 26K, UTB should have reviewed this document before issuing the offer on 19 July 2023, as it was available via a link provided in April 2023 and UTB had specifically requested to see the planning submission. The withdrawal was based on information that existed when the offer was issued, not new information discovered after issuance. Fair treatment requires that offer withdrawals be based on genuinely new information, not information a lender failed to discover during its own due diligence. Therefore, UTB should have rejected the application initially rather than issuing and then withdrawing the offer.
How this compares
| Group | Decisions | Uphold rate |
|---|---|---|
| United Trust Bank Limited, all decisions | 15 | 17% |
| Other regulated complaint, all decisions | 19,202 | 17% |
| Other regulated product, all decisions | 52,408 | 30% |
Source
Read the original decision on the Financial Ombudsman Service website