Not upheld: misleading information about mortgage completion dates and early repayment charge waiver policy complaint against Barclays Bank UK PLC

Decision detail

Summary

Mr G complained that Barclays provided misleading information about when he could change his mortgage interest rate. When applying for a new mortgage at a lower rate (4.02% vs 4.76%), Barclays failed to inform him that he could complete on 1 September rather than 1 October by taking advantage of their policy to waive early repayment charges in the last 30 days of a fixed rate period. Mr G discovered this in mid-August and arranged early completion, experiencing stress and inconvenience in the process. The ombudsman found that while Barclays made a mistake, no actual financial loss occurred as Mr G completed early and obtained the lower rate. The ombudsman upheld Barclays' offer of £400 compensation plus an £80 exit fee waiver (totalling £480) as fair compensation for the limited distress caused over approximately two weeks.

The Ombudsman's reasoning

The ombudsman acknowledged Barclays made a mistake in not informing Mr G about the early completion option. However, no actual financial loss occurred because Mr G was able to complete on 1 September (the earliest date without ERC) and benefit from the lower interest rate. The distress and inconvenience were limited to approximately two weeks from mid-August when Mr G discovered the mistake. Barclays resolved the problem before it caused financial loss. The offer of £480 (£400 compensation plus £80 exit fee waiver) was deemed fair compensation for the limited period of worry and inconvenience. The ombudsman rejected the request to waive the ERC on the new mortgage to allow switching lenders, as Mr G obtained the mortgage he applied for at the rate he was happy with, and interest rate movements after completion are a normal risk.

How this compares

Source

Read the original decision on the Financial Ombudsman Service website