Partially upheld: Mortgage advice complaints complaint against Barclays Bank UK PLC

Decision detail

Summary

Mr S and Mrs W complained about Barclays' handling of their mortgage porting application following their divorce and home sale. Barclays' mortgage adviser incorrectly told them the port would be a 'seamless' like-for-like transfer, when in fact it required a full affordability assessment and a Joint Borrower Sole Proprietor application because Mrs W would not be on the property title. This error only came to light in early September 2024 when another adviser took over the case, forcing Mr S to scramble to arrange finances under time pressure as he was close to completing his property purchase. The ombudsman found Barclays' error caused considerable distress but rejected Mr S's arguments that he would have acted differently, finding it unrealistic he would have withdrawn from the property sale. The complaint was partially upheld, ordering compensation of £600 for distress and reimbursement of the Early Repayment Charge of £45,125.62 with 8% interest.

The Ombudsman's reasoning

The ombudsman found that Barclays' primary error was misleading Mr S and Mrs W about the nature of the mortgage porting process by describing it as 'seamless' and like-for-like when the bank knew this was impossible. While the bank was entitled to make its own commercial lending decisions regarding the amount it would lend (£1.1million), the failure to provide correct information at the outset caused Mr S considerable stress and forced him to arrange finances under time pressure. The ombudsman was satisfied that had correct information been provided initially, Mr S and Mrs W would have proceeded with the port anyway, but on a more relaxed timeline. The ombudsman rejected Mr S's arguments that he would have acted differently, finding them unrealistic given the advanced state of the property sale.

How this compares

Source

Read the original decision on the Financial Ombudsman Service website