Not upheld: Irresponsible lending complaint against Swift 1st Limited

Decision detail

Summary

Miss C and Mr T complained that their second charge mortgage taken out in 2007 was irresponsibly lent because they were unemployed at the time, and that the current administrator Swift 1st should be barred from collecting payments due to the debt being statute-barred and alleged defects in the charge registration. The loan had been transferred twice since origination and no payments had been made since June 2014. The ombudsman found that the original lending decision was the responsibility of the now-defunct original lender W, and that Swift 1st, as administrator, is not responsible for either the original lending decision or the fairness of the lending relationship. The ombudsman confirmed the charge is properly registered and recovery action appears to be within the applicable 12-year limitation period, with legal arguments to be determined by the courts.

The Ombudsman's reasoning

The ombudsman determined that the original lending decision was the responsibility of lender W, which no longer exists and falls outside FOS jurisdiction. Swift 1st, as administrator, is not responsible for the original lending decision or the fairness of the lending relationship under section 140A of the Consumer Credit Act 1974, which is the responsibility of the current lender (Swift Advances plc), an unregulated firm outside FOS jurisdiction. The ombudsman found that recovery action appears to be within the 12-year limitation period under the Limitation Act, and the charge is properly registered at the Land Registry. Legal arguments about enforceability are matters for the court, not the ombudsman.

How this compares

Source

Read the original decision on the Financial Ombudsman Service website