Not upheld: unaffordable lending / arrears management / alleged forced borrowing complaint against Santander UK Plc

Decision detail

Summary

Ms M complained that Santander forced her to make unaffordable mortgage payments, use her PIP payments towards the mortgage, and take out Support for Mortgage Interest (SMI). The mortgage, held jointly with Mr M, fell into significant arrears after Mr M left the property in 2021 and stopped paying. A suspended possession order was granted in December 2024 requiring additional monthly payments, which Ms M could not maintain. The ombudsman found no evidence of coercion regarding SMI or PIP use, noting Ms M's own records showed she initiated SMI discussions and later declined it. Santander was found to have acted fairly in expecting arrears to be brought up to date and pursuing legal action when the court order terms were not met, with arrears reaching approximately £35,000.

The Ombudsman's reasoning

The ombudsman found that while Ms M's situation is sympathetic, there is no evidence Santander forced her to take out SMI or use PIP payments. Ms M's own contact notes show she initiated discussion of SMI and later stated she did not want it. Santander was entitled to expect arrears to be brought up to date and to pursue legal action when the suspended possession order terms were not met. Santander provided support including payment arrangements and a reduced interest rate. The mortgage arrears of £35,000 with no prospect of repayment meant Santander had no choice but to proceed with legal action.

How this compares

Source

Read the original decision on the Financial Ombudsman Service website