Not upheld: mortgage administration error and failure to process Permission to Let application complaint against Barclays Bank UK Plc

Decision detail

Summary

Miss A complained that Barclays failed to process a Permission to Let (PTL) application in October 2024, preventing her from switching to a new interest rate before her existing rate expired on 31 January 2025. The ombudsman found that PTL had never been granted to Miss A (having been declined in 2018) and therefore there was no PTL to lapse or extend. While Barclays made an administrative error in October 2024 by telling Miss A she needed to extend existing PTL, the bank subsequently granted PTL in January 2025 and offered a mortgage adviser appointment on 7 February 2025. The ombudsman found the offered redress of £253.82 interest reimbursement plus £200 compensation to be fair and reasonable, and did not uphold the complaint.

The Ombudsman's reasoning

The ombudsman found that PTL was never granted to Miss A, having been declined in 2018. This was evidenced by Barclays' written refusal, the 2022 broker submission for a BTL product (indicating Miss A knew she didn't have PTL), and Miss A's own statement in February 2024 that she lived in the property. The ombudsman rejected the argument that PTL had lapsed, as there was nothing to lapse. While Barclays made an administrative error in October 2024 by telling Miss A she needed to extend existing PTL, the bank's subsequent actions were reasonable. The ombudsman noted that Miss A could not have applied for a residential mortgage with a new lender on a permanently rented property regardless of PTL status, and that a 7 February appointment for a mortgage adviser was not excessive. The ombudsman also clarified that PTL is not relevant to new lenders' assessments of mortgage applications on tenanted properties.

How this compares

Source

Read the original decision on the Financial Ombudsman Service website