Partially upheld: Mortgage advice complaints complaint against Evolution Money Limited

Decision detail

Summary

Mr C complained that Evolution Money unfairly recommended a second charge loan of £25,648 by presenting it as a short-term stepping stone to refinancing within three years, when the shared ownership status and high loan-to-value made refinancing unlikely. The ombudsman found the loan was suitable for Mr C's primary objective of reducing monthly outgoings by £450, but Evolution Money failed to clearly explain the limited refinancing prospects. Although the ombudsman concluded Mr C would likely have proceeded with the loan regardless, the firm's misleading presentation of refinancing options caused avoidable distress. The complaint was partially upheld with a £500 remedy awarded.

The Ombudsman's reasoning

The ombudsman found that while Evolution Money's recommendation was suitable for Mr C's primary objective of reducing outgoings, the firm failed to present the possibility of refinancing in a clear and fair way. The firm presented refinancing as a realistic short-term option without adequately explaining that it would be unlikely given the loan-to-value restrictions and shared ownership status. However, the ombudsman concluded that even with clearer information, Mr C would more likely than not have proceeded with the loan because it achieved his main objective of reducing monthly outgoings by £450. The ombudsman rejected arguments that debt advice should have been offered, as Mr C was not experiencing payment difficulties. The ombudsman awarded £500 for the distress caused by the misleading information about refinancing.

How this compares

Source

Read the original decision on the Financial Ombudsman Service website