I’m hoping someone might have experience of something similar, particularly with the Financial Ombudsman.
My ex-partner and I had already separated and court proceedings concerning our family home were ongoing when he took out a substantial second-charge loan secured against the property. He did not tell me he was applying for the loan and I had absolutely no knowledge of it at the time.
I remained living in the family home with our three young children. One of our children has significant disabilities and long-term needs, and I am his main carer, which significantly limits my ability to work.
The Family Court has since found that I have a beneficial interest in the property through constructive trust/proprietary estoppel, although the exact percentage has not yet been determined. There are ongoing property and Children Act proceedings which are being combined, and we are being encouraged to see whether we can reach an agreement between ourselves.
The problem is that this second-charge borrowing has eaten up a substantial amount of the equity in the home. That equity is incredibly important to me because the house is the children's long-term housing security, particularly given my disabled child's future needs.
I am already paying the substantial first mortgage myself. My ex is now not paying the second-charge loan either, and his position is effectively that if I want to retain the children's home, I should take responsibility for this loan as well, even though he took it out after we separated without telling me.
Taking both on would put me under severe financial pressure and leave considerably less money available for the children.
I am also concerned about where the money actually went. My ex says the borrowing was used to repay old debts connected with renovations to the property, but he has provided only limited financial disclosure and I have seen nothing that actually traces the loan proceeds or evidences that explanation.
Because I had nothing to do with the application, I also have no idea what he told the second-charge lender when he applied. I don't know whether they were told that we had separated, that I and the children were living in the property, that court proceedings were ongoing, or anything about my interest in the home. The lender won't give me the application documents because I am not the named borrower.
The lender has been extremely slow dealing with my concerns and appears to think the Family Court proceedings will resolve matters. But this is where I'm confused. The Family Court is dealing with the interests between my ex and me and is encouraging us to reach a settlement. I am concerned about a different issue: how this lender came to accept a substantial second charge over the family home in the first place and what representations/checks were made at the time.
I want to know what the lender was told about ownership and occupation of the property, what declarations were made, what checks they carried out and whether the charge was properly obtained given that I was living there and had a beneficial interest but knew absolutely nothing about the borrowing.
I have looked into specialist legal advice, but unfortunately I simply cannot afford the fees I have been quoted, so I am considering pursuing the complaint myself and taking it to the Financial Ombudsman Service if the lender doesn't properly investigate it.
Has anyone dealt with anything remotely similar, particularly where an ex took secured borrowing against the family home after separation without the other person's knowledge? Has anyone successfully taken something like this to the Financial Ombudsman, and did they investigate the original loan application and what the lender had been told?
Any experiences or advice on where I should go from here would be really appreciated.