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When everyone has a home

028 9024 5640: Housing & Debt Helpline for Northern Ireland

Important legal win for Housing Rights Service as Bank of Scotland withdraws appeal

Back in August, we brought you news of an important and potentially far reaching decision in one of our legal cases.  The case involved some of our Mortgage Debt Advice Service clients who had taken out Bank of Scotland mortgages.  Bank of Scotland appealed the decision, but has now withdrawn this appeal. 

Bank of Scotland double billing customers

Our advisers' investigations showed that the Bank of Scotland had been capitalising the borrowers’ mortgage arrears by adding the arrears to the outstanding mortgage balance, without the borrowers’ consent. This resulted in an increased mortgage instalment, so that, in effect, the customers were paying off the arrears but were not aware of this, nor aware of how much was being paid to address the arrears. Significantly, the bank continued to proceed with legal action to seek possession of the properties and sought additional payments towards the arrears in order to prevent possession.  This meant that, although the arrears had been added to the balance of the mortgage, the bank was still using these arrears as justification to seek possession of the property. 

In August, the Chancery Master was highly critical of this practice, stating that he would "...certainly not regard this as fair accounting". 

Appeal withdrawn

The Bank of Scotland withdrew its appeal against the judgment on Monday 8th December.  Our Mortgage Debt advisers and solicitors are to be congratulated on identifying this practice and on succesfully arguing such a high profile and influential case. 

Getting help with mortgage debt

Homeowners from Northern Ireland who have fallen behind on their mortgage payments can get free advice and representation through our Mortgage Debt Advice Service. Call us on 028 9024 5640 or 0300 323 0310 between 09.30 and 17.00 Mondays, Wednesdays and Fridays or between 09.30 and 20.00 Tuesdays and Thursdays.

Homeowners from the rest of the UK who have fallen behind on their mortgage payments should contact Shelter.

Tagged In

Repossession, Legal

This article was written on 10 December 2014. It should not be relied on as a statement of the current law or policy position. For help with housing issues please contact our helpline on 028 9024 5640 or use our online chat service at www.housingadviceNI.org.