Not upheld: mortgage arrears management, failure to reinstate direct debit, failure to provide arrears statement, refusal to formalise payment arrangement complaint against Gatehouse Bank Plc
Financial Ombudsman decision DRN-6106119 of 2026-05-06T00:00:00+00:00. mortgage arrears management, failure to reinstate direct debit, failure to provide arrears statement, refusal to formalise payment arrangement complaint against Gatehouse Bank Plc. Outcome: Not upheld.
Decision detail
| Reference | DRN-6106119 |
|---|---|
| Decision date | 2026-05-06T00:00:00+00:00 |
| Firm | Gatehouse Bank Plc |
| Product | mortgage |
| Claim type | mortgage arrears management, failure to reinstate direct debit, failure to provide arrears statement, refusal to formalise payment arrangement |
| Outcome | Not upheld |
| Remedy | Gatehouse Bank Plc has already implemented the recommended redress: (1) refunded £20.05 in additional interest charged on the July 2025 payment due to the failed direct debit reinstatement; (2) paid £250 compensation for the errors and delays; (3) apologised for the delay in providing an arrears statement. No further remedy was ordered. |
Summary
Mrs M and Mr N complained to Gatehouse Bank Plc about their home purchase mortgage account, alleging that the bank failed to reinstate a cancelled direct debit for July 2025, resulting in a missed payment and arrears accumulation, refused to formalise their proposed £3,500 monthly payment arrangement, and failed to provide an arrears statement. The account, opened in July 2023, had accumulated arrears of approximately £50,000 by the time of the complaint. Gatehouse acknowledged the errors and offered compensation, which the Investigator increased to £250 plus a £20.05 interest refund. Mrs M and Mr N rejected this and requested an ombudsman review, seeking formalisation of their payment arrangement. The ombudsman found that Gatehouse's position was fair and reasonable, as the borrowers appeared to have substantial undisclosed disposable income beyond the £450 monthly arrears payment they were offering, and the bank was entitled to request further financial evidence before formalising an arrangement. The ombudsman upheld the compensation already provided and made no further orders.
The Ombudsman's reasoning
The ombudsman found that Gatehouse's request for further financial information was reasonable given that Mrs M and Mr N appeared to have approximately £1,500 more in monthly disposable income than they were offering towards the mortgage arrears. The ombudsman considered the mortgage a priority debt and expected borrowers to direct available funds towards arrears before discretionary spending. The non-specific nature of the claimed essential expenditure and the lack of supporting evidence justified Gatehouse's position. The ombudsman was satisfied that the bank was not obligated to make a counter-proposal and that solicitor response delays were acceptable given the need to take instructions. The errors that had occurred (failed direct debit reinstatement and missing statement) had been rectified with appropriate compensation.
How this compares
| Group | Decisions | Uphold rate |
|---|---|---|
| Gatehouse Bank Plc, all decisions | 10 | 35% |
Source
Read the original decision on the Financial Ombudsman Service website