Not upheld: loan administration and fairness of adding legal costs to debt complaint against Swift 1st Limited

Decision detail

Summary

Mr S complained about a secured loan originally taken in 2007, raising three issues: mis-selling of the loan and PPI, excessive interest rates, and Swift's handling including possession proceedings. The ombudsman's jurisdiction was limited to Swift's actions since January 2026, specifically the addition of legal costs to the loan balance. The court had granted a possession order with a money judgement, which Mr S subsequently paid. The ombudsman found Swift acted fairly in adding the legal costs as this was contractually permitted and is standard industry practice when courts are silent on costs allocation. The complaint was not upheld, though the ombudsman recommended dialogue between the parties regarding the remaining legal costs debt.

The Ombudsman's reasoning

The ombudsman's jurisdiction was limited to Swift's handling of the loan since 19 January 2026. The only action to consider was the addition of legal costs to the loan balance. Swift had contractual right to add these costs, and since the court order was silent on costs allocation, the contractual position prevailed. Adding legal costs is normal industry practice, and nothing in Mr S's circumstances suggested a different approach was warranted.

How this compares

Source

Read the original decision on the Financial Ombudsman Service website