Lloyds Bank PLC · DRN-6256519

The complaint Ms D has complained about her mortgage she holds with Lloyds Bank PLC. She said she was promised a new fixed rate product for the remaining term of her mortgage, but when she called back to arrange that she was told there was no product available for her. She said the false hope had caused her huge distress. What happened Ms D took out this mortgage in August 2006 to buy a property. It was noted on the application form that she had an existing mortgage that would be remaining in place. She applied to borrow £112,000 over 20 years on a capital repayment basis. The current run of arrears started in January 2015 with no payments made in January, February or March. A payment was made in April 2015 and then no payments were made until Ms D started paying £40 a month in March 2023. In March 2023 the contractual monthly payment was around £820, and the arrears balance was around £63,200. Ms D continued to pay £40 a month and by August 2025 the arrears balance was around £92,000 and the contractual monthly payment was around £1,390. During that time Ms D was in contact with Lloyds, with her keeping it informed of her circumstances. I understand the mortgage term on the second property ended in 2014, and a balance remains outstanding. The mortgage term on the property that is the subject of this complaint is due to end in August 2026. In 2020 Ms D referred a complaint to our service about something that had happened in the past with her local council where she felt Lloyds should have done more to support her. That complaint was looked at by one of my Ombudsman colleagues who said the complaint had been referred to us too late under our rules as Lloyds had responded to the complaint in 2017, and our rules require a complaint to be referred to us within six months of a final response letter from the business. The complaint I’m considering here was raised with Lloyds in August 2024 when Ms D was told she couldn’t have a new fixed rate product as there was only two years left on her mortgage term. Ms D’s complaint was that she said she’d been told on an earlier call that she could have a new fixed rate product. Lloyds responded to the complaint on 13 September 2024. It said it had been unable to locate the call in question where Ms D said she was told she could have a new fixed rate product, and it was sorry that Ms D was told she would be eligible for a new rate. It said that wasn’t correct as Ms D didn’t have long enough left on her mortgage for a product to be put in place. It provided a further copy of that letter to Ms D, at her request, in February 2025. Ms D initially referred the complaint to our service on 10 March 2025 and then progressed matters in August 2025 when she returned our complaint form. In that Ms D explained her vulnerabilities, said she had lost her job through ill-health and said that she would need to sell her second home due to her financial struggles. She said the apology from Lloyds wasn’t enough, and it should be able to offer her a better solution. She also set out the details of

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what had happened in the past with her local council where she felt Lloyds should have done more to support her. The complaint was looked at by one of our Investigators. He said we wouldn’t look at the complaint about what happened in the past with the local council as an Ombudsman had previously issued a decision on that. In respect of Ms D’s complaint about a new fixed rate product he said he’d listened to all three calls that happened around that time and no promise had been made that Ms D could have a new fixed rate product. Ms D indicated that she didn’t agree with the assessment and asked for more time to respond. Despite various extensions being granted since our Investigator issued their assessment on 15 October 2025, five months have now passed and Ms D still hasn’t provided her substantive response. I understand she wanted to listen to the calls, with those being provided to her many months ago. We can’t keep cases in abeyance indefinitely and so I’m now deciding the case based on what we already hold. What I’ve decided – and why I issued a provisional decision earlier this month, the findings of which said: “We don’t decide every complaint that’s referred to us. There are some complaints that we can’t look at, because the rules we operate under don’t allow us to. And there are others that we are able to look at, but we choose not to due to their circumstances. The rules that set this out are referred to as the Dispute Resolution (DISP) rules and are laid down within the Financial Conduct Authority’s handbook. DISP rule 3.3.4A says ‘The Ombudsman may dismiss a complaint referred to the Financial Ombudsman Service on or after 9 July 2015 without considering its merits if the Ombudsman considers that: (5) dealing with such a type of complaint would otherwise seriously impair the effective operation of the Financial Ombudsman Service.’ DISP rule 3.3.4B says ‘Examples of a type of complaint that would otherwise seriously impair the effective operation of the Financial Ombudsman Service may include: (3) where the subject matter of the complaint has previously been considered or excluded under the Financial Ombudsman Service (unless material new evidence which the Ombudsman considers likely to affect the outcome has subsequently become available to the complainant).’ I’ve considered everything that’s been said and provided and, having done so, I’m satisfied that Ms D’s complaint about what had happened in the past with her local council where she felt Lloyds should have done more to support her is the same as the complaint we issued a decision on in 2022. I’m also satisfied that no material new evidence has been put forward as to why Ms D didn’t refer that earlier complaint to our service before the time limit ran out. By material new evidence we mean information that wasn’t available for Ms D to submit at the time we previously considered the complaint that is material to the outcome. At some point there has to be a conclusion; if we were to routinely revisit cases complaints could run on and on. In my view, this would not be in keeping with our statutory objective to resolve complaints with a minimum of formality and it could also undermine confidence in the entire process thus affecting the effective operation of our service. Having considered things carefully, although I am sorry to disappoint Ms D, I’m not persuaded there is any new evidence which has subsequently become available that hasn’t already been considered. So, I see no basis upon which we should look into this

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complaint again. Taking everything into account, it follows that I’m satisfied this complaint should be dismissed for the reason set out in DISP rule 3.3.4 - that it would seriously impair the effective operation of this service if we were to look into the same complaint again. In relation to the complaint about what happened in August 2024, I’ve considered all the available evidence and arguments to decide what’s fair and reasonable in the circumstances of this complaint. Although I’ve read and considered the whole file I’ll keep my comments to what I think is relevant. If I don’t comment on any specific point it’s not because I’ve not considered it but because I don’t think I need to comment on it in order to reach the right outcome. I’ve a great deal of sympathy for the position Ms D is in. It’s clear she’s gone through – and is still going through - some very difficult times, and it can’t have been easy to mentally revisit those times when bringing this complaint. I’ve not gone into any detail about that in this decision to protect Ms D’s privacy once the decision is published. But I’d seek to reassure her that I’ve read and taken into account everything she’s said. I can see why there was some confusion as Ms D was told a new fixed rate product could be considered, but unfortunately she didn’t have the time to discuss that on the relevant calls so it didn’t come to light that a remaining term of two years and four months was needed for a new fixed rate product to be put in place. Whilst it would have been better if Ms D had been told that immediately, the call handlers were clear that if Ms D wanted a new fixed rate product then she would need to speak to a specialist team about that and I’ve not heard that any promises were made that she would definitely be able to get a new fixed rate product. It may be, had Ms D’s mortgage term not been a barrier, then Lloyds wouldn’t have been able to put a new fixed rate product in place for a different reason. It is unfortunate that Ms D didn’t have time to discuss that at the time in question as, then, it seems likely it would have become immediately apparent when she spoke to the specialist team whether or not she could have a new fixed rate product. That said, I’m not persuaded Lloyds’ minimum term requirement had to be an automatic barrier because I understand the option it would have discussed was a form of forbearance. However, for Lloyds to consider such a request it would have needed Ms D to complete a detailed call with it where it went through her full circumstances and the idea of such an option is to try to get a mortgage back on track. Here even a reduced rate wouldn’t have done that due to the level of the arrears, the amount Ms D said she could afford to pay each month, and the short-term remaining on the mortgage. Instead, even a new fixed rate product would have meant her arrears and mortgage balance would still have been increasing month on month. So, even if the remaining term wasn’t a barrier, it seems likely Lloyds would have considered the best option would have been to proceed with what Ms D had been suggesting she would do, which was to sell her second property and use the proceeds to redeem both mortgages (that is, redeem the mortgage on that second property that was already ten years overdue and redeem the mortgage on this property that was, in August 2024, around £78,000 in arrears) rather than put in place a new fixed rate product which would have meant the arrears, and balance, was still increasing. Ms D has said Lloyds acknowledged fault, but whilst it did apologise that Ms D was told she would be eligible for a product review, it started that sentence by explaining it hadn’t been able to locate the call where Ms D says she was told she could have a new fixed rate product. So, in effect, Lloyds was taking Ms D at her word that she was told exactly what

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she said she was told despite not being able to find the evidence to support that. It’s not unusual for a business to apologise for what a consumer is complaining about without evidence that it did something wrong, and that seems to be what happened here. Saying Ms D could have a product review isn’t the same as guaranteeing Ms D could definitely have a new fixed rate product and the call handlers used language like “if we are able to provide you with a new fixed rate” and “if it’s showing that you may be eligible for a new fixed rate”. In any event, even if I did find that a Lloyds call handler said Ms D could have a new fixed rate product this is what we call a misrepresentation. When we’re looking at complaints about misrepresentations we consider the appropriate remedy is to place the consumer in the position they would be in if the incorrect information hadn’t been given. We don’t put them in the position they would be in if the misinformation had been correct. Ms D is already in the position she would have been in, as she was later told that her mortgage term wasn’t long enough for a new fixed rate product to be put in place. For that reason, even if I were to make a finding that Lloyds had misled Ms D (and to be clear, that isn’t a finding I’ve made) there would be no grounds for me to order Lloyds to do anything further in respect of this issue. I understand this decision will be a disappointment to Ms D and I give her my best wishes for both now and the future. But in terms of the complaint that was brought to us, I simply can’t uphold it however much Ms D may want me to.” Lloyds accepted my provisional decision. Ms D, despite a reminder of the deadline, didn’t respond. I’ve considered all the available evidence and arguments to decide what’s fair and reasonable in the circumstances of this complaint. Having done so, and having considered the full file afresh, I see no reason to depart from my provisional findings. My final decision I don’t uphold this complaint. Under the rules of the Financial Ombudsman Service, I’m required to ask Ms D to accept or reject my decision before 24 April 2026. Julia Meadows Ombudsman

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