Not upheld: unfair application decline / lending decision complaint against Nationwide Building Society

Decision detail

Summary

Mrs S complained that Nationwide unfairly declined her credit card application at the soft search stage, arguing that the firm should have conducted a more thorough review of her accounts, savings, and income before making a decision. Mrs S acknowledged she may have understated her income on the application and highlighted her £10,000 in savings and regular credit card payments. Nationwide declined the application due to low affordability based on the information provided. The ombudsman found that Nationwide was entitled to rely on the information Mrs S submitted and was not required to conduct further checks, and that it was reasonable to decline at the soft search stage once the lending criteria were not met. The complaint was not upheld.

The Ombudsman's reasoning

The ombudsman found that Nationwide was entitled to rely on the information Mrs S provided in her application and was not required to conduct a more thorough review of her accounts or complete a hard search before declining at the soft search stage. The ombudsman noted that once Nationwide determined the application did not meet its lending criteria based on affordability, it was reasonable to decline at the earliest opportunity rather than conduct further checks that could negatively impact the applicant's credit file. The ombudsman confirmed that internal evidence showed the decline was based on affordability, not the historic bankruptcy, and that Nationwide has an obligation to lend responsibly.

How this compares

Source

Read the original decision on the Financial Ombudsman Service website