Unaffordable Loan Claims

Jump to: Introduction Do I Have a Claim? How Do I Claim?

When you apply for a loan, the lender should make checks to be sure that the amount they lend to you is easily affordable and you can comfortably repay the monthly payments. Unfortunately, some lenders did not do enough to make sure that this happened and so many people fell into the trap of having unmanageable debt.

Do I have a complaint?

High monthly repayments relative to your income, incessant reliance on short term credit, and constantly juggling day to day living expenses or defaulting on other bills to service your loan are often glaring indicators of an unaffordable loan. If you find yourself having to sacrifice basic needs or if loan repayments are causing significant upheavals in your other financial responsibilities, you might be dealing with an unaffordable loan. It’s also worth noting that borrowing more money to cover existing loan repayments is a serious warning sign.

For loans, a lender should have made adequate checks at the start. The larger your loan, the worse your credit score and the more other debt you had, the closer a lender should look.

Points to add to your complaint if they apply to you:

• My bank statements and credit record (attached) show that I was unable to afford the loan repayments. You could see from my income and expenditure I was in financial distress
• This was a large loan, you knew I had poor credit and may have been in a difficult position so you should have tried to verify my income and expenses. If you had done this, you would have rejected my application.
• During a telephone call, your agent suggested some figures should be lower to get my application accepted.
• If the lender was your bank – you should have seen from my bank account that I was in financial difficulty, I was using my overdraft a lot, I had gambling transactions or I was only making minimum payments to my credit card from you.

Remember, if your loan was fine to begin with, but you later struggled after an unfortunate event (made unemployed or your mortgage payments increased etc), you are unlikely to win an affordability complaint as this would not have been predicted at the start.

How do I claim?

If any of the above sounds familiar with your Loan, then you need to contact the Lender who sold you the finance and complain. To find the information of where to contact, you need to log onto the Lenders website and find the “complaints” section. This will tell you where to write or email with the accompanying address.

Once you have found this information, write your letter of complaint/email using the prompts above to support your case. The Bank then has 8 weeks in which to make a decision or tell you why within that timeframe they cannot. If the Bank rejects your complaint, you then have the option of referring the complaint to the Financial Ombudsman Service. You can find out how to use their service by clicking on the link below:

www.financial-ombudsman.org.uk.

If you do not know your Loan details:

Then you can send a Data Subject Access Request (DSAR) request to the finance provider to obtain this information allowing them 1 month in which to answer the request. Include as much information about yourself as possible but include full name, date of birth, address at the time of the account, and anything else you find appropriate.