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Now this is interesting…

By J

The Observer had a very interesting article yesterday, which can be found here.

It concerned the complaint by Andrew Brown (not his real name) to the Financial Ombudsman Service. Mr Brown was a tenant of a housing association who was persuaded by a mortgage adviser to take out a mortgage and purchase the property (presumably under the terms of a preserved RTB). The mortgage had an attractive initial rate and then (can you tell what it is yet?) the interest rate shot up. Mr Brown was unable to service the debt and was ultimately repossessed.

The article suggests that he then complained to the FOS, arguing that the mortgage adviser had broken the Mortgage and Home Finance: Code of Business by failing to ensure that the mortgage was “suitable for the customer” and, more importantly, that the FOS found in his favour. The issue of compensation remained to be decided.

The facts of this case aren’t going to be a surprise to readers of this blog. There is copious evidence, both published and anecdotal, about the behavior of “off-high street” mortgage companies. I doubt that many people will go all the way to a complaint to the FOS (although, in the current market, who knows) but this does seem to present interesting new opportunities for defending possession proceedings. I know very few people who actually run arguments based on the MCOB, as they’re generally regarded as window-dressing for the industry but, perhaps, this might be about to change.

I have requested a copy of the decision from the FOS but, as yet, have not had a response. If any of you have a copy already, please do let us know.

J is a barrister. He considers housing law to be the single greatest kind of law known to humankind and finds it very odd that so few people share this view.


  1. house

    Interesting post, some of the loans / mortgages I’ve seen have been just wrong. Will be be most interested to read the decision if you get it, which I hope you do!

    • J

      My request for a copy has been declined.

      • NL

        Any reasons given?

        • J

          Apparently they didn’t actually produce any written report and, in any event, I can’t have it. They didn’t release it to the Guardian either, suggesting that the Guardian just interviewed the people involved.

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