Not upheld: arrears management, possession order enforcement notification, affordability assessment complaint against Kensington Mortgage Company Limited trading as Acenden

Decision detail

Summary

Mr G complained to the Financial Ombudsman Service about Kensington Mortgage Company Limited's handling of his mortgage arrears exceeding £25,000 and its notification that it would enforce a possession order. Mr G claimed he could only afford £150 per month towards arrears despite his Income and Expenditure form showing over £1,000 disposable income, and alleged that Kensington's enforcement notification caused him and Mrs G to move into rented accommodation at £995 per month, incurring substantial additional costs. The ombudsman found that Kensington acted reasonably in refusing the inadequate payment offer, as Mr G's bank statements revealed significant discretionary spending on gambling and retail purchases, contradicting his affordability claims. The ombudsman concluded that the £400 compensation for distress caused by the enforcement notification was fair and did not uphold the complaint.

The Ombudsman's reasoning

The ombudsman found that while Kensington made a mistake in notifying Mr G of possession order enforcement during payment arrangement discussions, the £400 compensation was fair. Regarding affordability, the ombudsman reasoned that Mr G's claim that he could only afford £150 per month was undermined by his subsequent decision to commit £995 per month to rent plus additional utilities and council tax for a second property. The bank statements revealed substantial discretionary spending on gambling and retail purchases totalling several hundred pounds monthly, which contradicted Mr G's assertion that he could not afford more than £150 towards arrears. The ombudsman concluded that Kensington acted reasonably in pressing for higher payments given the discrepancy between stated affordability and actual spending patterns.

How this compares

Source

Read the original decision on the Financial Ombudsman Service website