Not upheld: mortgage advice - Decision in Principle issued without income verification complaint against Stonebridge Mortgage Solutions Ltd

Decision detail

Summary

Mr M, a self-employed first-time buyer, complained that Stonebridge Mortgage Solutions issued a Decision in Principle in April 2025 indicating he could borrow around £190,000 without first verifying his income. When Mr M made an offer on a property in July 2025 requiring £150,000 borrowing, Stonebridge requested verification documents and discovered his actual net profit was lower, reducing his maximum borrowing to around £112,000, causing the purchase to fall through. Mr M claimed Stonebridge should have verified his income earlier and sought compensation for financial losses and stress. The ombudsman found that Stonebridge was entitled to issue the DIP based on unverified information with clear caveats about verification, and that it had asked for net profit figures as Mr M had provided, therefore not upholding the complaint.

The Ombudsman's reasoning

The ombudsman found that Stonebridge was entitled to issue a Decision in Principle based on information Mr M provided, as it clearly stated lending was subject to verification. The ombudsman determined it was more likely than not that Stonebridge had asked for net profit figures based on the July 2025 message exchange, and that there was no requirement for Stonebridge to verify income before issuing the initial DIP. While Stonebridge could have verified earlier, it was not obligated to do so.

How this compares

Source

Read the original decision on the Financial Ombudsman Service website