Not upheld: mortgage administration, communication failures, credit file reporting, rate switch implementation complaint against THE CO-OPERATIVE BANK P.L.C.

Decision detail

Summary

Mr R complained about his joint mortgage with The Co-operative Bank following his separation from the other borrower. He alleged the firm failed to send rate switch documents separately as requested, causing him to miss the deadline and incur higher payments, and that it wrongly reported a missed payment to his credit file and refused to convert the mortgage to interest only. The ombudsman found that while The Co-op made communication errors, it could not backdate the rate switch because the joint borrower never signed their acceptance form, and the credit file reporting was fair as the mortgage was in arrears. The ombudsman upheld the firm's £350 compensation offer as appropriate for the communication failures but rejected all other claims.

The Ombudsman's reasoning

The ombudsman found that while The Co-op gave contradictory information about sending separate correspondence to Mr R, it could not be required to backdate the rate switch because the other joint borrower never returned their signed acceptance form, meaning the rate switch could not have been implemented regardless. The ombudsman rejected the claim that The Co-op must convert the mortgage to interest only, as this would require a full application and the error in the rate switch offer did not create an obligation to do so. The ombudsman upheld the credit file reporting as fair because the mortgage was in arrears (even by arrangement) and Mr R remained contractually liable as a joint borrower. The ombudsman found The Co-op's communication errors caused upset and inconvenience but that £350 compensation was appropriate.

How this compares

Source

Read the original decision on the Financial Ombudsman Service website