Not upheld: default recording and notification complaint against NATIONAL WESTMINSTER BANK PUBLIC LIMITED COMPANY (NatWest)

Decision detail

Summary

Miss P complained that NatWest recorded a default on her loan account without proper notification and failed to support her as a vulnerable customer. She had received a payment holiday from May to September 2020 due to Covid-related financial difficulty, with an agreement that no adverse information would be recorded. After the holiday ended and she missed further payments in July 2021, NatWest declined to extend the loan term due to her lack of affordability and proceeded to default the account in October 2021. Miss P claimed she did not receive the required default notification letters and raised her complaint over three years later in June 2025. The ombudsman found that NatWest's decision to default was reasonable and that system records confirmed the required letters were sent to the address on file, with Miss P's failure to receive them likely attributable to her unnotified change of address rather than any firm failure.

The Ombudsman's reasoning

The ombudsman found that NatWest's decision to default was reasonable given the accumulated missed payments and Miss P's demonstrated lack of affordability after the payment holiday ended. The ombudsman determined that NatWest's system notes provided evidence that required default letters were sent to the address on file. The ombudsman concluded that Miss P's failure to receive the letters was more likely due to her change of address (which she had not notified NatWest of until after the default) rather than any failure by NatWest. The ombudsman rejected the suggestion that NatWest's admitted issues with sending loan extension letters extended to the default letters, finding no evidence to support this. The ombudsman noted that Miss P's complaint was brought over three years after the events in question.

How this compares

Source

Read the original decision on the Financial Ombudsman Service website