DRN-4705467 – Shortfall of £69,800.45 after a sale by LPA receivers; complaint not upheld
What happened: Receivers appointed by Rooftop sold a buy-to-let property at auction, leaving £69,800.45 still owing. The borrower said a letter from Rooftop meant she no longer owed it.
What the Ombudsman decided: The Ombudsman did not uphold the complaint. The shortfall was still owed, and the complaint about the sale itself was not one the service could consider against Rooftop.
Why: The mortgage terms made the borrower responsible for any shortfall after a receiver sale, and a complaint response letter does not change the mortgage contract.
Why this may matter to you: It shows where the line is drawn between Rooftop and a receiver: complaints about how a receiver sold a property are treated as complaints about the borrower's own statutory agent, not about the lender.
The published decision records that the complaint was not upheld.
What mattered to the Ombudsman
- The receivers acted as the borrower's agent, so the conduct of the sale was not Rooftop's to answer for
- The wording of the 2007 mortgage conditions on shortfall liability
- That the letter relied on was a complaint response, written about the level of contact, not a new agreement
These are the factors this particular decision treated as important. Ombudsman decisions are not precedent and another case can turn out differently.
What this does not prove
This does not establish that a receiver's conduct can never be challenged — it says the Ombudsman could not consider it against Rooftop in this complaint. Nor does it decide whether the sale price was reasonable; that question was not examined.
Source details
- Source type
- Financial Ombudsman Service decision
- Source
- Financial Ombudsman Service, final decision DRN-4705467 (Ombudsman: Gerard McManus)
- Date
- 27 June 2024
- Reference
- DRN-4705467
- Mortgage type
- Buy to let
- Jurisdiction
- United Kingdom
- Organisations
- Rooftop Mortgages Limited
- Source quality
- Official source
- Last checked
- 2 September 2026
- Added
- 2 September 2026
What happened
A buy-to-let mortgage taken out in 2007 on an interest-only basis. Rooftop appointed a firm of Law of Property Act receivers in April 2022. The receivers reported that the property was let below value, marketed it, put it into two auctions and sold it following a post-auction offer, with completion in February 2023. A shortfall of £69,800.45 was confirmed in May 2023. The borrower complained that she was not responsible for the shortfall and that the property had been undersold.
What the borrower complained about
The borrower said Rooftop's final response letter — which told her she was no longer a client, no longer a mortgagee and no longer the property owner, and that her account was closing — superseded the mortgage contract and meant she owed nothing. She also said Rooftop had colluded with or permitted the receivers to sell the property at an undervalue.
What Rooftop said
Rooftop said the redemption funds from the sale had been applied to the account leaving a shortfall still to be calculated, that the relationship had changed because the property had been sold, and that she could still contact its buy-to-let team.
What the Ombudsman decided
The Ombudsman held that the complaint about the sale itself could not be considered against Rooftop, because the sale was conducted by the receivers acting as the borrower's agent rather than by Rooftop. On the shortfall, he found condition 14.9 of the 2007 mortgage terms made the borrower responsible for any shortfall after a sale by the lender or a receiver, and that a complaint response letter is not a renegotiation of the mortgage contract or a waiver of the debt. The complaint was not upheld.
Outcome
- Complaint not upheld. The shortfall remained payable.
- Amount stated: £69,800.45
Key extracts
“if we, or any receiver appointed by us sells the property under the mortgage and the net proceeds of sale are insufficient to repay the mortgage debt in full you will continue to be responsible for the shortfall and we will charge interest on the shortfall until it is repaid in full”
Mortgage conditions clause 14.9 (2007), quoted in final decision DRN-4705467
“I cannot investigate a complaint about the sale of the property, which was conducted by Y, the LPA receiver, acting as agent of Ms S.”
Ombudsman, final decision DRN-4705467
Why this record may be relevant
This decision concerns responsibility for a sale carried out by LPA receivers and liability for the shortfall that followed.
Source
Financial Ombudsman Service, final decision DRN-4705467 (Ombudsman: Gerard McManus)
View original sourceThe date shown is the date stated in the published decision by which the consumer was required to accept or reject it.
If you believe this record is inaccurate or incomplete, see corrections and right of reply.