Nationwide Building Society · DRN-6037598

The complaint Mrs K has complained about a mortgage she took out with Nationwide Building Society in December 2022. Unfortunately, the property she bought had a defect that she only found out about after completion and she feels Nationwide let her down in respect of the valuation process, its communications and the customer service provided. What happened In July 2022 an independent mortgage broker, acting on behalf of Mrs K, submitted an application to Nationwide for a mortgage to purchase a new property. The application noted that Mrs K had agreed a purchase price of £137,500 and she wanted to borrow £107,500. In August 2022 a valuation report was completed and then in September 2022 Nationwide issued the formal mortgage offer. The purchase completed in December 2022. In January 2023 Mrs K obtained a structural report with the terms of reference saying “To investigate and report on the following specific aspects to the property :- check the structural integrity of the chimney breast. This report covers no other aspects of the property and, as instructed, is not a full structural report.” Mrs K made a complaint to Nationwide in April 2025. Nationwide responded to that on 27 May 2025. It said it hadn’t done anything wrong as its valuation was for lending purposes only, and a declaration had been signed electronically on 26 July 2022 agreeing that Mrs K would have the property valued and inspected for her own purposes. When referring the complaint to our service Mrs K said that due to concealed defects she had to undertake urgent and essential works. She also said she’d been told the property wasn’t worth as much as she paid for it. To put things right she said she wanted £24,900 (which was £17,000 price reduction plus £7,900 in repairs and associated costs). Our Investigator didn’t uphold the complaint. Mrs K didn’t agree and so it was passed to me to decide. 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. I’m very sorry to hear of Mrs Ks situation. I can’t imagine how difficult things have been for her. I’ve taken everything she has said into account. I’m conscious I’ve condensed the events of the complaint into rather less detail than Mrs K has presented them. No discourtesy is intended by this. I’ve given careful consideration to all the submissions made by both parties, but I won’t address each and every point that has been raised. I’ll focus on the matters that I consider most relevant to how I’ve reached a fair outcome. We’re not the regulator, and I’ve no power under our terms of reference to comment on, or otherwise determine, how financial businesses operate in general terms. I have to consider

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this complaint by reference to Mrs K’s particular situation. When I do that, I don’t uphold this complaint. I’ll explain why below. In deciding what’s fair and reasonable in all the circumstances I’ve taken full account of relevant law and regulations, as well as the regulator’s consumer duty rules (where relevant) and the rules of mortgage regulation. I understand Mrs K wants me to comment on the case law she has referred to but I won’t be doing so as, not least, the first of the cases referred to is about the actions of a surveyor in respect of a valuation that the customer had paid for, but this complaint is about Mrs K’s mortgage lender (not a surveyor) and Mrs K didn’t pay for the mortgage valuation report. The second appears to be incorrectly cited, and the third relates to a BTL investor and the court found the surveyor didn’t owe them a duty of care. Mrs K has also mentioned previous decisions issued by this service, referring to them as precedents. Firstly, whilst Mrs K has referred to multiple complaints being upheld between 2017 and 2023 she hasn’t provided the decision reference numbers of any of those, so I’ve been unable to see the exact cases she is referring to. And in any event, we consider each complaint on its individual merits, so what may look to an outside reader a very similar case may have some distinct characteristics that means a different outcome is reached. Mrs K has provided conflicting accounts, both saying: “This directly influenced my decision to proceed without commissioning a separate survey.” And; “I would also like to add that I did attempt to arrange my own valuation at the time. I had concerns about the accuracy of Nationwide’s valuation, particularly because the internal condition I observed during my viewing did not match the listed photographs ,which I believe should have prompted a lower valuation. I therefore wanted a second opinion before proceeding with the purchase. To that end, I submitted a request via the [online estate agent], which sends enquiries to multiple surveyors and vendors, notifying them that I was seeking an independent valuation (see Exhibit 11). I received an email confirmation of my request. This shows that I was taking reasonable steps to protect myself, but when they contacted me they informed me that I could not proceed with a valuation unless I was the legal owner of the property, a requirement that effectively blocked me from obtaining the independent survey I had attempted to arrange. This led me to believe only banks are authorised to carry out valuation and something one cannot do themselves” Mrs K can’t have both trusted Nationwide so she decided to not commission her own survey, whilst also having concerns about the accuracy of Nationwide’s valuation so much so that she wanted a second opinion. In any event, what Mrs K has provided is contact she made with an online estate agent finder, not a firm of surveyors. An estate agent would look to value a property on the basis the customer owned it and wanted to sell it through their business, which wasn’t the case here. There’s nothing on that website to indicate they would put her in touch with a firm of surveyors. What Mrs K needed to do was find an independent surveyor and instruct them to carry out a pre-purchase survey (often called a home survey, or homebuyers survey). She could search for a surveyor on the website of the Royal Institution of Chartered Surveyors1 1 https://www.ricsfirms.com/

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(“RICS”). That is entirely normal and what many people do when buying a property. However, it wasn’t Nationwide’s place to advise her on that. Mrs K has said “Nationwide repeatedly refused to clarify the type of valuation that would be carried out on the property. Despite my direct inquiries, they withheld this information, leaving me with the reasonable assumption that a physical inspection would take place. Their lack of transparency and refusal to disclose the valuation type led me to believe I was receiving a full, in-person valuation, which turned out to be incorrect.” But when asked about these calls, Mrs K provided two dates both of which were after the mortgage had completed. So those calls couldn’t have left her “with the reasonable assumption that a physical inspection would take place” [my emphasis] as the valuation report had already been completed at the start of August 2022 but the first call she has referenced didn’t take place until January 2023, which was five months later and the other was in May 2025 (so nearly three years later). Mrs K has also said “Nationwide's communication implied that an in-person inspection would occur. For example, I was told that I “didn’t need to be there for the valuation,” which only makes sense if a physical inspection were taking place.” But that’s correct. Whilst a full internal in-person inspection didn’t take place, a visit was made to the property to compile information and take external photographs, and Mrs K didn’t need to be there for that. She’s also commented on the different wording between the illustration and the declaration, saying “The first document I received clearly stated: "I may…", giving me the option to arrange my own valuation or survey […] However, the second document, which I have never received nor signed, allegedly states: "I must…" arrange my own survey, contradicting the original wording in the first document, which happened to be dated on the same day. This contradiction raises serious concerns about the accuracy and consistency of the documentation Nationwide has relied upon. The inconsistency between these two documents indicates a lack of clarity and transparency, which can mislead the borrower.” Whilst I acknowledge the point Mrs K is trying to make, that one says “may” and the other says “must” the part Mrs K has failed to quote is that the remainder of the sentence each time was: “Your product includes a free valuation. This will be a basic valuation carried out on the property and is for Nationwide's purposes only. You may want to arrange your own, more detailed, survey but you will have to pay for this.” And; “… you must have the property valued for your own purposes. You recommend that I arrange for a more detailed inspection for my own purposes;” So the use of the words may or must aren’t really relevant to the overall meanings, which is that both times Nationwide told Mrs K that she needed (or may want) to arrange her own inspection of the property for her own purposes. Whether Nationwide said she must or may do that doesn’t alter the fact it made it clear the valuation it was undertaking was just for its purposes. Mrs K has also said “I also refer to Nationwide's website (which I sent you screenshot of), which states that if I accept their valuation service, I cannot obtain my own home survey.”

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But Mrs K has taken that quote out of context and that isn’t what it says. The screenshot Mrs K has provided is from Nationwide’s intermediaries site (rather than its customer facing site) so the information wasn’t written for customer use, it was instead written for mortgage professionals who would have a different level of understanding. And more importantly, the part immediately before that, which Mrs K didn’t include with her screen shot, said: “We're legally obliged to assess the value of a property for mortgage purposes. This may not involve a physical inspection of the property. If the property is a New Build, the valuation report will be uploaded to the document store within NFI Online. Nationwide do not provide a reinstatement figure for the property as part of the valuation process. For other applications, we'll only release a copy of the valuation report in exceptional circumstances. Your clients are advised to get their own report on the condition and value of the property. We would advise a fuller inspection, such as a Home Survey level 2 or 3 report. Please note that once the valuation has been produced, you can't request a Home Survey report.” So again, it says that a customer is advised to get their own report on the condition and value of the property, and it goes even further by saying its valuation may not involve a physical inspection of the property. Further down the page it says: “We’ll carry out a valuation to ensure the property is suitable for mortgage purposes. It’s important to note: • Your client won't get a copy of the report. • The mortgage valuation may not involve a physical inspection or visit to the property. For example, we may use an Automated Valuation Model (AVM) or desktop valuation. • You must not rely on the report to identify defects in the property. There may be defects that will not be on the report for mortgage lending purposes, but which could be important to your client as the buyer. For their own purposes, your client should consider obtaining either a Home Survey Level 2 Report or a Home Survey Level 3 Report.” The information doesn’t say that if Mrs K uses Nationwide’s valuation service, she can’t obtain her own home survey. Instead, it is informing the reader that once a Nationwide valuation had been done, a request couldn’t be made for Nationwide to arrange for a Home Survey report. That’s because these are priced to all be carried out in one visit, so if Mrs K wanted to instruct a Home Survey report through Nationwide then she needed to say that before the valuation was instructed, she then would have been charged the relevant cost for that, and a surveyor would have visited the property just once. The surveyor would then have issued two separate reports; a mortgage valuation for Nationwide, and a separate Home Survey report for Mrs K. If Mrs K decided she wanted a more detailed report after the mortgage valuation had been carried out, then there was absolutely nothing stopping her arranging that herself with an independent surveyor. In any event, in a letter dated 25 September 2025 Mrs K said: “I only recently discovered, after checking Nationwide’s website, that if I chose to have the valuation conducted by them as part of the mortgage process, I was not allowed to instruct a separate home survey (see exhibit 9)

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At no stage was this restriction made clear to me during the application process. This raises serious concerns. Why would a lender prevent a buyer from obtaining their own independent survey?” So it seems even if the website contained misleading information (which I don’t find it did) Mrs K didn’t see that until after she bought the property and so it could have had no impact on her decision making about whether or not to instruct her own pre-purchase survey in the period between July and December 2022. Mrs K has also said she didn’t see the declaration either, so the difference in language between ‘may’ and ‘must’ could also not have mislead her as, going by what Mrs K said happened, the only statement she saw was the one contained in the mortgage illustration dated 26 July 2022 and that said “Your product includes a free valuation. This will be a basic valuation carried out on the property and is for Nationwide's purposes only. You may want to arrange your own, more detailed, survey but you will have to pay for this.” The information on Nationwide’s customer facing website, at the time of Mrs K’s application, said: “Mortgage valuation need to knows: • These are for the mortgage provider only. You won’t get a copy of the report • The Mortgage Valuation may not always involve a physical inspection or visit to the property. We may use an Automated Valuation Model (AVM), or do the valuation on a desktop • There’s no report on the condition of the home you want to buy. That’s covered by a Home Survey.” And: “Types of Home Survey We recommend you get a Home Survey done when you buy a property. The surveyor that does your Home Survey will be a member of RICS (Royal Institution of Chartered Surveyors). What you’ll get is a report on the property’s condition. There are 3 levels of survey - Home Survey Level 1, 2 and 3. You’ll need to decide which level is best for you.” And: “Or, you can arrange for the Home Survey yourself, in which case the fees will need to be discussed and paid directly to the survey company. For a Home Survey Level 1 these can’t be arranged with Nationwide. You’ll need to arrange and pay for it yourself with a survey company. You can find a surveyor on the RICS website” It is up to Nationwide what level of risk it wants to take with mortgage lending. If it is willing to lend on the basis of a non-internal inspection then it’s not my place to interfere with that. There’s nothing in mortgage regulation to say a lender must carry out an internal inspection, and there’s nothing in the information Nationwide made available that promised it would carry out an internal inspection, in fact as I’ve quoted above it all says the opposite, making it clear that it may not carry out an internal inspection.

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That was Nationwide’s choice, and it was Mrs K’s choice not to get her own survey of the property carried out despite, by her own admission, being concerned about the condition of the property and feeling the purchase price was maybe too high. Nationwide made it clear its report was for its lending purposes only, rather than being for Mrs K’s use, and it was up to her as a buyer of a property to do her own due diligence on whether the purchase price was fair and the property was a reasonable purchase for her needs and circumstances. If she felt she was unable to do that herself, then she needed to instruct an independent professional to look at the property on her behalf at her own cost. Mrs K has said she didn’t see the declaration, but that is between her and the broker as the broker, in the application submission to Nationwide, marked that Mrs K had agreed to it. I can’t hold Nationwide liable if that didn’t happen. As I’ve said, we’re not the regulator, and it isn’t our role to fine or punish businesses. I understand Mrs K feels Nationwide gave misleading and/or incorrect information, as well as not answering her questions in the way she wanted, in the calls in January 2023 and May 2025. Our Investigator gave his interpretation of why he thinks the January 2023 call went in the way it did, and having considered this point very carefully I don’t find his thoughts on that point unreasonable. Mrs K may not agree but, as I’ve already explained, this call took place after Mrs K had bought the property so even if incorrect information had been given it wouldn’t have any impact on the overall position she’d found herself in. Finally, Mrs K has commented on her subject access request she made to Nationwide. Her points on that didn’t form part of the original complaint and so I can’t consider it here. If Mrs K feels Nationwide hasn’t fulfilled its obligations then that is something she will need to raise with Nationwide first, and then if she remains unhappy her concerns may be better raised with the Information Commissioner’s Office2 than this service. My final decision I don’t uphold this complaint. Under the rules of the Financial Ombudsman Service, I’m required to ask Mrs K to accept or reject my decision before 16 April 2026. Julia Meadows Ombudsman 2 https://ico.org.uk/

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