HSBC UK Bank plc · DRN-6254865

The complaint Mr H complains that HSBC UK Bank plc failed to put in place a temporary interest-only arrangement on his mortgage as agreed. He also complains that it then wrongly treated the mortgage as being in arrears, it sent demands for payment and threatened legal action, and it refused only to communicate with him in writing as he had asked. What happened In May 2024 Mr H arranged a new fixed interest rate and a temporary interest-only arrangement on his mortgage with HSBC. The rate switch went ahead but the interest-only arrangement did not. Mr H found out that his payments hadn’t been changed to interest-only on a call with HSBC in June 2024. He had expected the interest-only arrangement to be in place for his June mortgage payment and said he couldn’t afford the usual monthly payment of capital and interest. His direct debit was suspended and HSBC said it would look into what had happened. It treated the matter as a complaint. On 6 August 2024 HSBC sent Mr H its final response to the complaint. It accepted it had told him in May that a temporary interest-only arrangement had been agreed and would start from June. It said it was sorry that this hadn’t in fact been agreed and it needed to discuss the matter with Mr H. It also paid him £300 compensation. Over the following months HSBC called Mr H but was unable to discuss his mortgage with him. It also wrote asking him to call. Mr H asked for communication to be in writing only and said HSBC had to comply with that request under the Equality Act 2010 because he has a disability. He also said he would withhold payments to the mortgage until his dispute was resolved. In December 2024 HSBC wrote to Mr H and said that it was willing to backdate the six- month interest-only arrangement but it needed to discuss the matter with him first and it would expect the mortgage arrears to be cleared. It then continued to email asking him to call. In February 2025 it sent him a final demand letter. On 7 May 2025 HSBC sent Mr H its final response to a complaint about the final demand. It said it had been trying to contact him to discuss backdating the temporary interest-only arrangement, but because it had been unable to speak to him it had followed its usual debt recovery process for mortgages in arrears. In June 2025 HSBC instructed solicitors. On 23 July 2025 HSBC sent Mr H its final response to a complaint about its decisions to treat the issues he had raised before as complaints, the mortgage arrears and the debt recovery action it had taken. It said it had done nothing wrong. In July 2025 Mr H referred a complaint to us. Our Investigator concluded that part of the complaint should be time-barred, because Mr H had left it too late to complain, and that the part of the complaint he could consider shouldn’t be upheld.

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Mr H didn’t accept that conclusion and asked for an Ombudsman’s review. I issued a decision confirming what I can and can’t consider in this complaint. I explained that I can’t consider the complaint HSBC responded to in its August 2024 final response letter – that is, Mr H’s complaint about what HSBC told him about the temporary interest-only arrangement in May 2024 and about that arrangement not then being put in place in time for the June 2024 payment. I said I can consider Mr H’s complaints about HSBC’s treatment of him and its administration of his mortgage after 6 August 2024 which HSBC responded to in its May and July 2025 final responses, because Mr H referred those complaints to us in time. I’ll now set out my conclusions about that. What I’ve decided – and why I’ve considered all the available evidence and arguments to decide what’s fair and reasonable in the circumstances of this complaint. This complaint stems from the agreement Mr H and HSBC reached in May 2024 to switch Mr H’s mortgage onto an interest-only basis for six months under the Mortgage Charter, and HSBC not then making that change. I can’t however consider Mr H’s complaint about that agreement and HSBC not implementing it in May/June 2024 because this complaint is time-barred, as I explained in my previous decision – I can only look at Mr H’s complaint about what happened after August 2024. Mr H knew in August 2024, when he received HSBC’s final response letter, that the temporary interest-only arrangement hadn’t been applied to his mortgage and HSBC wanted to discuss his mortgage with him. Over the following months HSBC’s records show that it tried to call Mr H and it sent him multiple emails and letters asking him to get in touch. Mr H replied a few times by email saying that he would only communicate with HSBC in writing. He also said that he has a disability and so, under the Equality Act 2010, HSBC was obliged to agree to written communication only. I don’t consider that HSBC was wrong, in principle, to ask Mr H to call to discuss his mortgage. The mortgage was in arrears with no payment plan in place, and in this situation I’d expect a lender to want to understand the borrower’s circumstances in order to see what it could do to help. Mr H said that he didn’t want to talk to HSBC on the phone and he would only communicate in writing. He also said that he’s entitled under the Equality Act 2010 to request written communication only. The Equality Act is designed to prevent discrimination against people with a ‘protected characteristic’. Protected characteristics include certain disabilities. Mr H may well have a protected characteristic under the Act – but it’s not for the Financial Ombudsman Service to make a decision about whether there has been a breach of the Act. That’s a matter for the courts. While I’m required to take into account relevant law, amongst other things, ultimately I must decide what I think is a fair and reasonable outcome to this complaint in all the circumstances. In doing so, I’ve taken into account HSBC’s obligation to offer reasonable adjustments to customers with a disability. In all the circumstances I don’t think HSBC, or the solicitors acting on its behalf, was unreasonable in asking Mr H for more information about his disability in order to decide how best to adjust its communication with him. Mr H had been able to discuss his mortgage with HSBC by phone up until June 2024 and, given the seriousness of escalating mortgage arrears, a phone discussion is often the quickest and most effective way to find a solution. If Mr H still requires HSBC to make adjustments to the way it communicates with him due to his health conditions, he should let it know what adjustments he needs and why so that HSBC can assess what it can reasonably do, bearing in mind its obligations under the

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Equality Act. Alternatively, Mr H may choose to appoint someone to talk to HSBC on his behalf. HSBC told Mr H in late 2024 that it was willing to backdate the six-month interest-only arrangement but it needed to discuss the matter with him first because arrears had built up since June. I think that was reasonable. Mr H had stopped making payments to his mortgage in May 2024. The Support for Mortgage Interest payments he had been receiving then stopped in early 2025. Payments didn’t resume, so the mortgage was in arrears and in February 2025 HSBC sent Mr H a final demand for payment and later instructed solicitors to begin possession proceedings. I think HSBC was clear with Mr H about what steps it was taking to recover the debt. Given the increasing arrears and given that there was no arrangement in place to get the mortgage back on track, I don’t think HSBC treated Mr H unfairly in sending him a final demand and deciding to begin legal action. It couldn’t allow the situation to continue indefinitely. I also don’t think HSBC was wrong to treat the issues Mr H raised with it in his letter of 10 March 2025 as a complaint. The financial services regulator, the Financial Conduct Authority, defines a “complaint” in the Glossary to its Handbook as: “any oral or written expression of dissatisfaction, whether justified or not, from, or on behalf of, a person about the provision of, or failure to provide, a financial service, […], which: (a) alleges that the complaint has suffered (or may suffer) financial loss, material distress or material inconvenience; and (b) relates to an activity of that respondent […] which comes under the jurisdiction of the Financial Ombudsman Service.” Mr H’s 10 March 2025 letter set out what he saw as various failings by HSBC relating to its administration of his mortgage which he said had caused him financial harm, distress and inconvenience. I’m satisfied that this was a letter of complaint because it met the definition of a complaint as set out above. HSBC was therefore right to treat it as such. Finally, I’ve noted what Mr H has said about the unenforceability of the mortgage agreement. The enforceability or otherwise of the contract is not for me to decide – that’s a matter for a court. But I think it was reasonable for HSBC to continue to ask Mr H to pay his mortgage, despite what Mr H sees as breach of contract, so I’m not requiring it to write off the debt. Repossession should be a last resort, but HSBC may ultimately decide to proceed with action to repossess Mr H’s home if no agreement can be found. It may well be that there is a solution to be found so that Mr H can clear the arrears – but there will need to be a dialogue between HSBC and/or its solicitors and Mr H for that to happen. My final decision My final decision is that I don’t uphold this complaint. Under the rules of the Financial Ombudsman Service, I’m required to ask Mr H to accept or reject my decision before 24 April 2026. Janet Millington Ombudsman

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