Mortgage Decision Reference 2022-0176

Case OutcomeRejected
Subject MatterMortgage
Reference2022-0176
Date27 May 2022
Finantial SectorBanking
Conducts Complained OfMis-selling
Decision Ref:
2022-0176
Sector:
Banking
Product / Service:
Mortgage
Conduct(s) complained of:
Mis-selling
Outcome:
Rejected
LEGALLY BINDING DECISION
OF THE FINANCIAL SERVICES AND PENSIONS OMBUDSMAN
This complaint relates to the sale of a lifetime mortgage loan to the Complainant and her
husband in October 2006.
The lifetime mortgage loan was sold to the Complainant and her late husband by a named
Broker (the “First Broker”) which was an appointed intermediary of, a Second Broker, (the
Provider”). The Provider in turn was an appointed intermediary of a named Mortgage
Lender (the “Mortgage Lender”). The Mortgage Lender ultimately extended the lifetime
mortgage loan to the Complainant and her husband.
The lifetime mortgage loan that is the subject of this complaint is secured on the
Complainant’s dwelling house and facilitated the drawdown of €270,000. The mortgage has
a fixed interest rate of 6.74% and an APR of 6.95%. (the “Loan”)
Sadly, the Complainant’s husband passed away in January 2015. Consequently, the
Complainant now maintains this complaint in her sole name. Insofar as the Complainant is
referred to below, the actions of the Complainant, and her position referred to below, are
also taken to include the actions and position of her late husband.
This complaint concerns only the conduct of the above-named Respondent Provider (the
Second Broker). The parties are aware that separate complaints have been raised against
the First Broker and the Mortgage Lender and that the documents and evidence available
from all three complaint investigations by this Office, have been shared amongst all those
parties.
- 2 -
/Cont’d…
The complaint is that in or around October 2006, the Provider mis-sold the Loan to the
Complainant because:
the Provider did not explain the nature and implications of the Loan; and
the Loan was unsuitable to the Complainant’s requirements as it was a lifetime
product on which the Complainant could not make repayments.
The Complainant’s Case
The Complainant submits that she and her son, first met with the First Broker in or around
October 2006, at the First Broker’s office. The purpose of this meeting was to secure funding
to assist their son in reaching a financial settlement with his ex -wife. The Complainant
explains that she and her husband had previously approached their Bank with a view to
securing such funding, but they had not been successful due to their advanced age. The
Complainant states that the First Broker’s representative, “Mr X”, suggested an equity
release product, but that:
“.. he went on to say that he did not know much about [the equity release product]
but would find out and get back to [the Complainant]”
The Complainant states that a number of days later, in or around 12 October 2006, the First
Broker’s representative, Mr X visited her home, and dropped off application forms for two
different mortgage lenders, which she and her husband completed themselves. The
Complainant contends that Mr X did not explain the loan, but instructed them to drop back
the completed application forms to his office.
The Complainant states that she and her husband returned both application forms to the
First Broker, and that the Mortgage Lender subsequently issued a loan offer letter to the
Complainant’s solicitor, which was signed by the Complainant and her late husband on 1
November 2006. However, the Complainant states that at no point did the First Broker, the
Provider or the Mortgage Lender, offer them any advice regarding the Loan.
The Complainant states that she was not aware of the involvement of the Provider when
the loan was sold in October 2006, and she subsequently discovered that “[the Provider]
had an arrangement with [the First Broker] for some referral type of businessand that the
Mortgage Lender processed the Loan application on foot of information received from the
Provider, who in turn received the information from the First Broker. The Complainant
queries
“[h]ow [the Provider] processed this application when they had never met us, had no
record of advice given and yet still received a commission payment of €2,700”
The Complainant contends that, at the time she and her husband entered into the lifetime
loan agreement, it was her belief that this was a loan that they “could pay off in a 5-year
period”.

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