UPDATE
The Scheme of Arrangement proposed by Amigo has now been rejected by the court after it was opposed by the FCA.
See Court rejects Amigo Scheme of Arrangement for details.
We do not know yet what Amigo will do. In June I looked at Amigo – what is happening with “Scheme 2.0”?
In July, FOS emailed customers saying it was not working on their Amigo complaints.
A lot of people with current loans want to know if they can stop paying. See “Should I stop paying Amigo?” – the pros & cons.
This page will be updated when there is clearer news for customers.
The approval process for the Scheme – that ended in rejection
On 30 March, the First Court Hearing gave the go-ahead for Amigo to organise the creditor voting.
An online page to vote was set up and a creditors’ meeting held.
The FCA has published a letter saying:
The FCA considers that a fair compromise could have, but in this case has not been, proposed to Scheme Creditors to vote upon. Therefore… the FCA has decided that it intends to appear at the Sanction Hearing through counsel to oppose the sanction of the Scheme, even if approved by the requisite majority of Scheme Creditors, on the basis that the Court cannot be satisfied that the Scheme in its current form is fair.
On 19 May the Second Court Hearing took place. The FCA opposed the Scheme going ahead
On 24 May the judgement in the case was published – the judge accepted the FCA’s arguments and did not approve the Scheme.
An overview of the Scheme as it was proposed
Amigo is proposing a Scheme because it can’t afford to pay refunds to all the customers who were given unaffordable loans. It says it will go into administration if the Scheme is not approved.
Amigo says customers may get a cash refund of about 10% of their proper refund value. I think the amount may be lower.
Customers with a current loan, however, will be able to have the full amount of their refund deducted from their balance and their guarantor released in the Scheme if Amigo upholds their claim. And they can also get this if Amigo went into administration if the administrators uphold their claim.
About a million Amigo customers have been texted or emailed about the Scheme. This includes current customers – the borrowers and guarantors for the current 137,000 loans – and all previous customers whose loans have been repaid. If you haven’t received an email about this, check your spam folder!
Amigo has set up a website with information for customers about the Scheme. This contains the Practice Statement Letter (PSL) which sets out more details. And a longer Explanatory Statement.
If the Scheme starts, all open FOS cases will be sent back to the Scheme.
Under the Scheme, customers can put in a claim if they have affordability complaint or if they have any other complaint about a loan or the way Amigo treated them.
There will be a six month period for these claims to be sent in after the Scheme start date. After that time you will not be allowed to make a claim in the Scheme and will not be able to take a complaint to the Ombudsman either.
Amigo will decide whether to uphold each claim:
- The Explanatory Statement lists a lot of factors that will be taken into consideration in Schedule 4.
- Will Amigo uphold the same very high rate that the Financial Ombudsman (FOS) does? It has not said this.
- Amigo will appoint an independent person to look at any appeals – you can’t go to the Financial Ombudsman.
Amigo will then calculate the redress (the legal term for the refund you would have received if there wasn’t a Scheme) for the claims it upholds:
- for borrowers this is the interest they paid.
- it seems likely Amigo will be applying the “unpaid interest deduction” that it started making in summer 2020. This will reduce people’s refunds, see Amigo should end unpaid interest deductions and remove CCJs for details.
- guarantors the calculated refund will be a refund of everything they have paid.
- where a guarantor is being paid a refund, the guarantor payments are removed from the borrower’s account. If the borrower has also had a Claim upheld, interest will be removed from the borrower’s account. A borrower won’t be left worse off after this, but they may get little or no refund.
If you have a balance still owing to Amigo:
- your balance will be reduced by the refund;
- if you still owe a balance after this reduction, you can make an arrangement to repay it at a more affordable rate and your guarantor will be released;
- if the refund is larger than the balance this extra will be paid from the pot of cash Amigo is putting aside and you will only get a small percentage of it.
If you are owed a cash refund:
Customers whose loans have been repaid will have their cash refunds paid out of the pot of money Amigo is putting aside for this. But there won’t be nearly enough money to pay full refunds.
The pot will be divided up between all the people who are owed a cash refund who will all get the same “pence in the pound” percentage of their proper redress.
Amigo is putting in £15m, which could be increased by up to £20m if the balance reductions are lower than expected – this sounds unlikely to me. Amigo is proposing that it will add 15% of its profits in the next four years into this refund pot. As Amigo is currently loss-making this sounds like some jam in a few years, or possibly none at all.
Amigo says people may get paid 10% of their proper refund in the Scheme. On my figures, it could be even less, possibly as low as 5%.
Amigo expects the first payments to be made in the first half of 2022. It may be late in that period as Amigo has to allow time for any appeals to be made and reviewed.
Hannah says
Hi Sara, I made an affordability complaint to Amigo sept 2020 this was rejected and forwarded to Financial Ombudsman in Oct 2020. I took out a final top up on previous loans for £10,000 in July 2019 I have made payments of £7312.98 so far, would I be right in thinking I would only have to pay the remaining £2687.02 and I will have repaid what I borrowed?. In Feb 2021 I had to enter an IVA as my debt had got out of control and I felt I had no other choice. Amigo agreed to the IVA and agreed to freeze interest which they have still not actioned. They receive payments through my IVA and I also have to reimburse my guarantor the payments they take from their account so in total I am paying Amigo £524.91 a month which is ridiculous and I cannot afford this as I am on Universal credit as I am a carer to my disabled daughter. Please could you advise what I can do going forward? Thank you
Sara (Debt Camel) says
Why did you choose an IVA rather bankruptcy? do you own your house or did you need to protect some other asset?
Amigo don’t have to freeze interest on a guarantor loan – as soon as you don’t pay they just go after your guarantor.
Hannah says
Thank you for your reply. I was advised by the IV company that an IVA would be the better option. I was so depressed and anxious at the time I just agreed to it.
Amigo agreed to my IVA if the term was increased to 72 months and the payments were £260 a month as they receive 67% out of that and that they would freeze the interest.
Would I be right in paying the remaining £2000 I have left on the loan and then advising my guarantor to cancel the direct debit and CPA would this effect their credit report?
Sara (Debt Camel) says
It sounds as though your only income is Universal Credit and other child and disability benefits – is that right?
Do you know what the total of your debts was at the start of your IVA?
You are renting?
Do you have a car?
Who is your IVA firm?
I am asking these questions as an IVA may not be a good option for you at all. I have no idea how you can afford £260 a month…
How many Amigo top ups did you have?
Your guarantor – at the time of the last top up, could they have afforded to make all the payments to this loan out of their income and still been able to pay their own debts, bills and living expenses?
Steve says
I too have filed an affordability complaint both with amigo and the FOS. Took a £5750 loan out with amigo on 31/11/2018, and to date (04/07/21) have paid back £4447 plus £5,814.56 in interest , yet my balance is still £6,791.89 with monthly instalments of £227.27. Ceased to repay any money until a conclusion is reached with my complaint. Threats of court action etc and the barrage of calls , texts emails , I just revert them to my complaint number .
Sara (Debt Camel) says
You may want to think about making a complaint about the way the FCA is mis-handling this, allowing Amigo to not pay redress, which has meant that FOS has put all these cases on hold. It is wrong that Amigo should be able to threaten people with court action when it is choosing to ignore the fact that if your complaint is upheld you will not owe then any money at all.
See https://debtcamel.co.uk/amigo-scheme-timetable-approval-how-work/comment-page-9/#comment-432772 above which looks at how to complain about the FCA.
Camille says
Hello Sara,
I emailed Amigos to let them know I will not be making any payments until news of my complaint.
I received this email this morning.
Hi Camille,
Thanks for your email.
As we are currently exploring our options in regards to complaints, all irresponsible lending complaints are on hold.
Any payments that are made whilst the complaint is ongoing will be taken into account within your complaint, but you are expected to maintain your credit agreement whilst the complaint is on hold. Your account is currently 464 day in arrears if you do not resolve this with us and the account falls 14 days in arrears then we will need to look to * as guarantor for payments, if she is struggling then we will speak to her regarding this.
If you cannot afford the repayments then naturally we will never ask you to pay more than you can afford, however we will need to discuss your financial circumstances with you so that we can understand what’s affordable and see if we can get a reasonable agreement in place with you. I have turned your payments off so that we don’t take anything unaffordable, but we need to speak to you.
Please do call us on 01202629103 before 6 pm so that we can come to a resolution with you.
Regards,
Sara (Debt Camel) says
Isn’t it nice how they say you have to call them before 6pm, but they have no plans to look at your complaint which remains on hold…
You can call them if you want. But you and your guarantor should not feel pushed to pay what you know you cannot afford.
Amigo should determine your complaint, until then you do not know if you actually owe them any money at all.
Camille says
My thoughts excalty!
They can do one!
My guarantor has also sent an email with regards to her situation.
Symes says
Hi Sara, my guarantor has received this email and we are worried;
“As there is no resolution in place, soon you may be issued with an LBA (Letter Before Action), this is a legal notice which will allow you to come to a resolution prior to a court claim being considered. In Court, an order for the full balance will be sought. A CCJ may be issued against you and ####, where it will stay on both of your Credit File for up to 6 years.
If you’re in a position to do so, please arrange payment of the arrears. Call me on 01202 629108 or make a payment now”
It has been less than 2 weeks since the payment was not made. I’m shocked at how quickly they have threatened us with this. In this time we have had numerous texts, emails, calls, and letters ..all in less than 2 weeks !
Both my guarantor and myself have submitted complaints so from reading on here I am right in thinking they cannot issue an LBA ?
I have also asked Amigo on 3 occasions to cancel the Direct Debit and CPA (have cancelled this with our banks) and they are ignoring me. My bank said that although they have cancelled it at their end Amigo can re-set it and take the payment from my guarantor. Is this true ? My guarantor cannot afford to pay this., she is currently on sick from work so only receiving sick pay.
Sara (Debt Camel) says
I’m shocked at how quickly they have threatened us with this
They are one of the most aggressive lenders in the country :(
A couple of years ago they used to take very large numbers of customers to court. Now they threaten but actually going to court is now rare and I haven’t actually seen it happen for more than a year when there is an affordability complaint in place.
There is a chance they will issue an LBA. I have seen a few of those from them, but not recently. At the moment Amigo is walking a difficult line trying not to annoy its regulator the FCA too much – if anyone gets an LBA it should be reported to the FCA.
But read what they wrote: “soon you may be issued with an LBA (Letter Before Action), this is a legal notice which will allow you to come to a resolution prior to a court claim being considered.” I put those words into bold type…
They are not saying they WILL issue you with an LBA – that is what they hope you think they have said, but MAY is a lot weaker. I may win the lottery this week – but I probably won’t!
And even if you do get an LBA they are not saying they WILL go to court, just that they will CONSIDER it. I’ll consider running a marathon next week – but I don’t expect I will decide to do it.
re the CPA, it is your right to cancel. See https://www.fca.org.uk/news/news-stories/continuous-payment-authorities-it-your-right-cancel. If the CPA is reinstated, you can ask the card issuer (ie the bank) to repay you and take them to the Finacial Ombudsman if they don’t.
Symes says
They are very aggressive indeed. Bully tactics that simply shouldn’t be allowed. Surely this is borderline harassment?
I will be sure to report back here and to the FCA should an LBA be issued. How would I report this to the FCA please?
Thank you so much for your help-it is invaluable.
Also will be on to my bank again. Will also continue to contact Amigo to ensure it is cancelled.
Sara (Debt Camel) says
Come back here if you get an LBA. I will be surprised…
Nicola says
My guarantor has received the same email and is also worried sick that they will turn up at her door.
Reading this has made me feel slightly better but still very anxious and will pass this information on to my guarantor l. But it is very scary when they send this type of email as you just focus on the scary words and presume that debt collectors will arrive on your door step.
I have sent an email to amigo over a week ago and same as my guarantor but have had no response when I mention that they are going against what the fca have advised whilst an affordability complaint is in place but haven’t heard a peep back from them which makes me even more anxious.
Do we know if there is any update on there next appeal ?
Thanks Sara for all you help it’s does help so much.
Sara (Debt Camel) says
Sorry, no update on what Amigo are going to do next.
Sarah says
Hi
I’m really confused.
I filled in all the online stuff when Amigo emailed me about the scheme but i don’t actually have a specific claim in against them at this time.
I borrowed £10,000 top up loan back in 2019 which resulted in me physically getting just over £5000 as the rest was paid of an original loan.
I have paid off £11,709.36 total so far of which £6519.88 is interest only.
I still have an outstanding balance of £4322.63 which is been paid at a rate of £487.89 per month
i have 11 months left to make the monthly payment of £487.89 which to be honest is crippling me.
I have never missed a payment and never would as my son-in-law is my guarantor.
Should i be putting in a claim before the result of any scheme is decided.
Sara (Debt Camel) says
Think back to 2019 when you took this top up… at that point could you have afforded to make all the £487 a month repayments and still been able to pay your other debts, bills and living expenses?
Have your other debts and arrears got worse because of this loan?
jenny says
Hello I have a loan with amigo I havnt received any info on the scheme until an email a few days ago we have had a loan since 2017/2018 we had a top up to 5k in may 2019 we have since been paying £223.88 a month we havnt missed a payment however my guarantee has been taken off the agreement since last year as they have a IVA we are now experiencing financial difficulties and cant afford to pay what would you advice
Be we have probably paid back the loan we still have a balance of £3,441,34 it’s never ending
Sara (Debt Camel) says
So this loan was listed in your guarantor’s IVA debts? In that case they probably don’t care what you do as their IVA payments won’t change and their Amigo debt will be wiped out when their IVA ends. This isn’t quite “being revel as guarantor” but I suppose for you it amounts much the same thing?
What is the rest of your financial situation like apart from this Amigo debt?
Hannah says
Hi Sara, I have just had an email from Financial Ombudsman stating that they will not be taking my Amigo complaint any further at this time die to Amigo not having a scheme in place. If Amigo reach a new scheme or in fact go into administration would I be able to make a new affordability complaint?
Thank you
Sara (Debt Camel) says
Yes you will be able to in a new Scheme or if Amigo fails and goes into administration.
From our previous discussion you sound to have a very good claim. As you are in a form of insolvency making a claim will not help your own finances at all, but if you win it your guarantor will be released which is what matters to you.
PS you are in IVA at the moment but you may be able to save a massive amount of money by switching to a DRO where you do not have to make ANY monthly payments (the rules changed last week to let you do this) see https://debtcamel.co.uk/end-iva-change-to-dro/. But my above point is right whether you are in an IVA, or a DRO or bankrupt.
MEl says
I paid all my 2 loans off will I get a refund for the interest I paid it cost be so much
Sara (Debt Camel) says
If a new Scheme goes ahead, you can make a claim to the Scheme if you think the loans were “unaffordable” – making the payments left you short of money so you couldn’t manage without taking out more debt or getting behind with bills.
If Amigo upholds your claim to the Scheme you will get back a small proportion of the interest you paid. In their first Scheme, Amigo said it might be 10% – I thought it might be a lot less. I hope the second Scheme will be more generous to customers.
Sandra says
Hi Sara so the fos have sent me an email saying they can’t do anything about my complaint I put in last august and more aless that’s it, to be honest it’s very disheartening my complaint has been nearly a year with them and now they tell me they can’t do anything further. To say I’m
Annoyed is a understatement.
Sara (Debt Camel) says
is this Amigo?
It is incredibly annoying. Do you still owe a balance? If so, I have written about this here https://debtcamel.co.uk/stop-paying-amigo-pros-and-cons/
Sandra says
Hi Sara yes it’s with amigo the fos had got back to me in January and said they were sending amigo my complaint and that all the loans should be upheld apart from the first as I just was able to pay it but then had top ups a lot and the fos said they agreed the rest wasn’t affordable etc, now they are saying there is nothing they can do because amigo don’t know what they are at yes I still have a balance of £5000 but amigo did offer to bring it down to £1196 as they upheld the last two top ups but I had about 6 so I didnt except and I had paid them back probably three times in what I borrowed obviously the interest is crippling with them so now I haven’t a clue about anything
I stopped paying back in July last year I put a complaint in and so did my guarantor also back in august.
Sara (Debt Camel) says
ok so neither you nor your guarantor are currently paying?
Are Amigo pushing you to pay or have they given up?
Sandra says
Seems like they haven given up i haven’t heard from them at all in a long time
Sara (Debt Camel) says
OK so it is annoying your complaint is sitting in limbo but at least they are not trying to collect this debt. I am afroad you have to wait and put in a claim to the nes Scheme, if they get that approved, or to the administrarors if they go under.
Victoria says
Hi im looking for help too, I also cannot afford my loan ive paid since march 2018 on a £5000 loan £197.62 per month until June this year I have paid £7509.62 to these cowboys who use it all as interest and say i still owe £4029.60 to them. Now currently 2 months into arrears dont offer any help at all my dad who lives off pension credit at 74. Amigo expect him to hand that over to pay them he is carer for my Mum who has dementia and pay for carers 2 times a day they show no empathy at all. We offered to pay half of this but they won’t accept it. Really in a stuck situation I also have had a compensation claim in since last November same story as above they can’t tell you anything because of their insolvency and exploring other options what other options? they’ve never told the customers anything at all. But they can harass you and send threatening emails and texts and letters and expect us to phone them every week absolute joke really need some help
Sara (Debt Camel) says
They are horrible to deal with :(
I suggest you read https://debtcamel.co.uk/stop-paying-amigo-pros-and-cons/ and think about you and your dad refusing to pay. You are going to get hassle whatever you offer if you can’t pay the full amount, so you may decide you might as well stop and save your money and refuse to phone them every week to be badgered? Any money you pay from now, you will get very little back in a Scheme…
PS it sounds as though your dad can also make a complaint that the loan wasn’t affordable for him. That will give two ways for him to be released as guarantor, if you win your complaint or he wins his.
victoria says
Thank you Sara I shall do this
Derek says
Hi Sarah
If Amigo go into Administration, how likely is it that Administrators will pursue loans and guarantors? I am praying for them to go into administration and I can just stop paying, I would prefer that outcome to any percentage of a valid claim that would come from compensation.
Interested in your thoughts. Many thanks
Sara (Debt Camel) says
A loan does not disappear because the lender goes into administration. The administrators will want to continue to collect loan repayments and probably sell the loans to a debt collector at some point. The loans will not be sold until after claims have been decided,
BUT you will be able to make a claim to the administrators for unaffordable lending in the same way that you would be able to make a claim in any new Scheme Amigo sets up. In administration there may be little or no cash to distribute but you still have the right of set-off if your current loan is decided to be unaffordable, so any refund calculated will reduce your balance, possibly clear it. This set off applies even if there is no money to be distributed.
And if you win a claim your guarantor will be released and you will be able to repay any remainingbalance at a genuinely affordable rate.
The big question is, how likely are the administrators to approve your claim? From watching payday lender administrations, I know that administrators normally try to roughly follow (in an automated way) what the Ombudsman might have done. And FOS was upholding 88% of Amigo complaints.
So the administrators may be MORE likely to uphold your claim that Amigo are. Amigo have not said what their uphold rate is likely to be … but the fact they say they may payout 10% of calculated cash refunds suggests to me that they are expecting a low uphold rate…
Read https://debtcamel.co.uk/stop-paying-amigo-pros-and-cons/ which looks at whether you should stop paying Amigo.
Bee says
I have taken over management of the correspondence from Amigo re a loan my son is guarantor for due to his mental health situation. Complaint submitted back in December and then to FOS – but obviously now on hold.
I really cannot believe the amount of emails and texts I have had recently chasing payment. Followed yesterday by a lengthy phone call in which I stated I would not be recommending my son to pay until his complaint had been dealt with!
I was advised this could result in a lot higher arrears in the future and there was even a mention of attachment of earnings.
Unfortunately they could NOT give any information regarding what Amigos next plan of action was with regards to the scheme.
It makes me so angry that Amigo can just ignore and stop the handling of complaints and yet be very heavy handed chasing payments.
She wanted to record the details I gave her regarding my sons mental health ie did he have a GP diagnosis etc – is it possible they are secretly reviewing complaints to see what the current situation is?
Sara (Debt Camel) says
I really cannot believe the amount of emails and texts I have had recently chasing payment.
harassing for anyone, and the idea of sending them automatically to customers who have mental health problems…
this could result in a lot higher arrears in the future and there was even a mention of attachment of earnings.
well obviously not paying means arrears increase. But as Amigo now caps interest at the amount originally quoted when the loan was given, it should not in the long run increase the amount your son has to pay if he eventually loses his complaint.
An attachement of earnings is not going to happen unless Amigo gets a CJ. See my new article https://debtcamel.co.uk/stop-paying-amigo-pros-and-cons/on why threats of going to court seem to be just empty at the moment – it isn’t happening where someone has a complaint in.
That article also looks at why this is the FCA’s fault for allowing Amigo to ignore complaint and there is a section on how to complain to the FCA about this. If you do this for your son, include a bit about the barrage of communication despit them being aware he had mental health problems.
She wanted to record the details I gave her regarding my sons mental health ie did he have a GP diagnosis etc – is it possible they are secretly reviewing complaints to see what the current situation is?
That would be good…
but unfortunately they have always asked for this sort of thing and it has not made any difference I can tell in how they trat people. Indeed it can almost seem like a way of dismissing Mental Health concerns – you may be feeling too anxious to want to talk on the phone to us but if you don’t have a diagnosis of anxiety from a doctor then it isn’t real (I don’t mean they have said that to anyone, but it is what some people have felt about Amigo’s requests for evidence about MH problems.)
Sara (Debt Camel) says
can I ask what the rest of your son’s financial situation is like? does he have other problem debts? Is he buying or renting? Is he up to date with household bills?
Bee says
His financial situation at the moment is good.
I paid off his credit card debt and cancelled the card. He has handed back his car he had on finance. He lives with me so no rent or bills at present. Trying to take him back to basics with money management.
Amigo assured me they would have done all the affordability checks however I dispute this as although he was making his car payments he was up to the max on his overdraft and had no money spare each month to cover a loan.
The person he is guarantor for is totally unknown to me so I also question why my son would make such an arrangement with an acquaintance.
Fortunately my son has not had to make any payments as yet to cover the debt and there is no means for Amigo to just take the money at present.
I will look into the FCA link
https://debtcamel.co.uk/stop-paying-amigo-pros-and-cons/ as I think Amigo need to be forced into action!
Sara (Debt Camel) says
You can ask Amigo for a Subject Access Request for a copy of all his personal information. That should show you the I&E they mocked up for him. Sometimes these bear little resemblance to what he actually spent money on… eg there will be the car loan there but no insurance, MOT, petrol or amounts for servicing repairs. Also it should include a recording of his phone call with Amigo – that may be helpful and say something about how well he knows the borrower.
If Amigo refuse to provide or ignore the request, make a complaint to the ICO https://ico.org.uk/make-a-complaint/your-personal-information-concerns/. the FCA’s “informal moratorium” does not, so far as i know, mean Amigo can ignore SAR requests.
Lucy says
Hi Sara
I cancelled my direct debit with Amigo on 1st July. I emailed them to advise why, ie, complaint been put in and now with FOS, how I’d already paid over £1000 in interest with another 14 months to go.
The bullying texts, letters have already started.
My guarantor has done the same, cancelling his CPA .
My question is Sara, do I respond to these letters?
Many thanks
Sara (Debt Camel) says
You can simply reply that you will be happy to look at r3esuming your payments after your complaint has been assessed in the new Scheme they are looking at.
You could also tell the FCA what you think of their allowing Amigo to try to bully people like this. See how to do this in https://debtcamel.co.uk/stop-paying-amigo-pros-and-cons/
Neil says
Hi Sara
I have stop all my payments to amigo and my partern as cancelled is cpa, I have written to fca and foc to complain about amigo not looking into the complaints. MY PARTNER AS RECEIVED A LETTER FOR AMIGO SAYING THAT THEIR WOULD TAKE PAYMENT OUT OFF IS ACCOUNT IF I HAVE NOT PAID IN 4 DAYS TIME. I Have explained to amigo my partern as mental health and we do have letters for the doctors and specialist .
Sara (Debt Camel) says
I assume your partner is your guarantor. I hope they have cancelled their direct debit to Amigo as well as phoned their bank and cancelled the CPA.
neil says
Hi Sara,
Double checked on my partner banking account there’s is no direct debit set up on is account from amigo
Thanks neil
Lorraine says
My Husband made a claim to Amigo last year, for five loans/top ups, unsurprisingly they said he had no case. He referred the case to the Ombudsman and had the email from them this week.
How does he stand with stopping payments please ? And he’s assuming that if it’s Amigo deciding ongoing claims he will be refused. What happens then ?
Many thanks
Sara (Debt Camel) says
See https://debtcamel.co.uk/stop-paying-amigo-pros-and-cons/ which looks at the pros and cons of stopping paying Amigo and what he wouls have to do.
he’s assuming that if it’s Amigo deciding ongoing claims he will be refused.
It will be Amigo deciding complaints if they put forward a new Scheme which is approved – the last one was rejected by the court as being unfair to consumers.
With 5 loans, it is pretty likely that at least the later loans would be decided to be unaffordable in any Scheme. Even if this is only the last loan, his guarantor would be released and he could make a lower payment arrangement for any remaining balance. So a Scheme my not be a disaster for him.
If no Scheme is approved and Amigo goes into administration, he will be able to make a claim to the administrators – they normally try to follow roughly what the Ombudsman might have done so it may be more likely that his balance would be wiped out.
Lorraine says
Thank you for your advice Sara, he is going to stop making the £297 payments and email Amigo/FCA
Much appreciated 😊
James H says
Hi Sara,
On 24/10/2018, I settled an old loan of £8,761.29. The same day, I took out a £10,000 loan (a top up of £1,238.71).
I put in an affordability complaint using the Resolver website on 11/11/2020. They replied 3 times, saying they were looking into it and said I could complain to the FOS, but they stated they would still look into my complaint. I decided to wait and not complain to the FOS.
I continued paying monthly until 2 months ago, when I read about other customers having not paid since last year. I cancelled my DD and CPA last month, but it caused my guarantor lots of stress and worry. He is very concerned and won’t cancel his CPA as he doesn’t want his credit score affected if he doesn’t pay, which I completely understand.
Since then, we have been receiving texts and myself receiving emails and letters, telling me I need to make a payment. It worried my guarantor to the point that I have resolved to making the missed payment tomorrow.
I emailed them a few days ago, saying that I won’t make any payments until they go back to resolving my complaint, but I’ve had no reply.
Furthermore, should Amigo go into insolvency, how likely is it that my current loan will be written off, as I have paid back over £2,000 more than the loan I took out on 24/10/2018.
Many thanks,
James Harrod
Sara (Debt Camel) says
he doesn’t want his credit score affected if he doesn’t pay
His credit score will NOT be affected by not paying. The Amigo loan doesn’t appear on his credit record – he can check a credit report if he is worried about this.
It can only be harmed if Amigo takes him to court for a CCJ. But see https://debtcamel.co.uk/stop-paying-amigo-pros-and-cons/ for why Amigo may be threatening to take people to court but it is using very careful language which sounds worrying but doesn’t actually say they will go to court. And in practice Amigo is not going to court where there is an open complaint. This isn’t going to happen.
should Amigo go into insolvency, how likely is it that my current loan will be written off, as I have paid back over £2,000 more than the loan I took out on 24/10/2018.
A large top up loan is often a sign you are in financial trouble and the loan should not have been given. If you think Amigo should have realised the repayments would be unaffordable for you, then it sounds likely you would win a claim in administration – administrators usually try to follow what FOS might have decided.
You may want to think about complaining to the FCA about the pressure Amigo is putting you and your guarantor under. Because it is the FCA’s fault that they are allowing Amigo to not pay refunds, which is why FOS isn’t working on complaints any more. See that link for how to complain to the FCA https://debtcamel.co.uk/stop-paying-amigo-pros-and-cons/
James H says
Hi Sara,
Thank you for your swift response.
It may not affect his credit score, but the worry is that they will still take the repayment, even if he does cancel the CPA. He has stress at work and this is only increasing that stress even more.
I have emailed the FCA and relevant MPs, but I don’t anticipate a quick response as you stated on the other page.
I appreciate your help and wait with baited breath for what the coming weeks and months will bring.
Sara (Debt Camel) says
If he has cancelled the CPA and Amigo still takes a payment he can ask the bank to return it. He has the right to cancel a CPA as the FCA explains here: https://www.fca.org.uk/news/news-stories/continuous-payment-authorities-it-your-right-cancel
James H says
Hi Sara,
Thanks for your swift reply again.
I don’t want to cause him even more stress, so I have used the link in the latest text from Amigo to pay the missed payment tomorrow, and then continue the repayments. I know I will lose most of the repayment amounts, but I’m at the stage now where I just want the debt cleared and not worry about it, or cause any stress to my guarantor.
Simon says
Morning Sara.
different email than normal from AMIGO this morning
Hi xxxx,
It’s Richard at Amigo. It’s important to me that you have the facts regarding the CCJ that we could apply for if we’re unable to come to a resolution regarding the missed payments. When the loan was paid out, we could accept xxxxx because of the strong credit score they had built. A CCJ may impact that score and set their own ability to obtain credit back years.
starting to take the biscuit now arent they
Sara (Debt Camel) says
more weasel words…
the CCJ that we COULD apply for
It isn’t saying they WILL apply for one.
Lloyd says
Hi Sara
Can you give me some advice please?
I have taken out a loan back in 2018 had a top up in 2018 basically I took £8k and have paid £8k in interest and still owe 8k.
If I stopped making payments till they have seen or resolved my case. Would this help with the repayments if they do return some money?
Also I have told my guarantor to cancel any direct debts and CPA they may have.
I have asked am sick for help as I’ve been on furlough for the past 16 months and find it hard to make payments and had never missed a payment yet. To protect my guarantor (my best friend)
What advice could you give me please?
Thank you
Sara (Debt Camel) says
I have taken out a loan back in 2018 had a top up in 2018
Taking a top up very soon after the original loan is often a sign that you were in trouble. Were you finding it difficult to make the repayments to the first loan? Had your other debts gone up by the time you took the top-up?
I have asked am sick for help as I’ve been on furlough for the past 16 months and find it hard to make payments
Do you have other problem debts as well?
Any idea if you are going to have a job when furlough ends?
Lloyd says
Hi I have got other debt yes which have taken a hit most are bills I have not been able to pay due to my high amigo payments.
I have struggled for years but had to get cash after my separation and amigo was my only hope.
I am about to start another job to get back to full time work. With my debts building up it’s going to be hard to get straight for a while.
I have spoken to my guarantor he is happy for me to stop paying and has checked with his bank that he has not direct debt or CPA on his card he doesn’t even have the same card as then.
I have also insurances him it will not affect his credit score but will have to put up with there threatening ways
What’s my beat option in your point of view?
Thank you again
Sara (Debt Camel) says
As your guarantor is happy for you to stop paying, that is a great help.
It sounds as though you were in a difficult situation and should probably not have been given the loan. Of course it’s not possible to say that you will definitely win your complaint, but in your current position, it’s really important you catch up with essential bills. Can I suggest you talk to National Debtline on 0808 808 4000 about your whole situation? Not just the Amigo debts, but your other debts and bolls as well? They can help you work out what your priorites are – getting a full time job is great but as you say with a buld of of problems it may take a while to get financially straight again.
Ryan says
Anyone get an email from amigo today about a new scheme with customers on the panel ? Reply if you want to be considered ….like they could be amigo works or friends who they pick …think there just clutching at straws now …trying everything .
Kelly says
Yes received the same email too.
I have just ignored it !
MEH says
Previously said my son is guarantor and FOS recently said they’ll not look into it any more. My sons mental health is not good and whilst he could afford monthly payments if he lived rent free with us, we are seriously considering paying it off for him, £13600.00 and increasing all the time. I read that a guarantor would get a refund if claim upheld but would this be 100% refund or just a small %age if a scheme goes ahead?
Sara (Debt Camel) says
If you settle the loan, any refund in a Scheme would only be a tiny percentage.
And it would be likely be nothing if Amigo fail and go into administration – in administration your son’s claim would be considered and the he may be removed as guarantor so he wouldn’t have to pay any more but there is likely to be no cash for paying any refunds.
It is a hard decision to make here. Read https://debtcamel.co.uk/stop-paying-amigo-pros-and-cons/. And as that says you could consider complaining to the FCA – the FCA is supposed to protect vulnerable consumers like your son, but their actions in allowing Amigo to not pay refunds are putting an unreasonable amount of unfair pressure on people.
MEH says
Thanks, FCA have been contacted but their reply was just a standard response and no help at all. If we pay the arrears of approx £2400.00 and continue to pay the monthly £400.00, presumably he will never owe more than the current £13600.00?
The problem though is there’s no end in sight, amigo can drag it on for ever and before we know it, it’s all been paid and nothing refunded if his complaint is upheld.
If we knew it would be resolved in just a few months that would be something, we’d rather get no refund on £4000.00 say, than £13600.00.
Sara (Debt Camel) says
Amigo caps the interest it adds at what was stated on the original contract so this doesn’t carry on rising, if that is what you are concerned about.
Indeed Amigo can drag this on (which is why people should complain to the FCA who needs to stop allowing Amigo to do this) and every month you pay effectively throws away most of that money (assuming he wins the court case).
Amigo are bluffing when they are making threats of going to court, thousands of people are in this situation and no court cases are being started. So you can call their bluff and stop paying. In the worst case, if he eventually loses the complaint in 6-12 months time and Amigo could really go to court at that point you can either start making monthly payments or settle the debt before there is a CCJ.
Alternatively….
You said previously you son was always overdrawn, which suggests that he has other debts as well. Because you and he could consider another approach which is bankruptcy. You can pay the bankruptcy fee and continue to let him live with you. You can act as a guarantor for a tenancy if he later gets well enough to move out. And later, when he is discharged from bankruptcy, you could give him a present of a few thousand pounds. This would cost you a lot less than settling his debts and would leave him in a better position going forward. Bankruptcy drops off his credit record after 6 years – from that point he would be able to get a mortgage so bankruptcy is not a permanent bar.
He could talk to National Debtline on 0808 808 4000 about this? He may feel less guilty about an option that costs you less?
MEH says
The interest cap would take the debt to £23k, another £10k on top of what is the balance now. He doesn’t have debts as such, he’s up to date with other payments (1 car loan) and is not likely to be granted bankruptcy. The point of our case is that when the loans were given, he was overdrawn regularly and 3 top ups within 12 months indicated debt problems. Its just the risk of the debt becoming £23k the longer it drags on.
Sara (Debt Camel) says
is not likely to be granted bankruptcy.
yes he is. He cannot repay the Amigo loan and pay reasonable living expenses (you should be charging him a reasonable amount of rent if he does go bankrupt). He may not want to go bankrupt (which is fine) but it is his choice whether to do so and it would not be refused.
If the borrower had 3 top ups within 12 months then that is a very good reason to complain. As is the fact your son was regularly overdrawn.
(Incidentally, will the borrower co-operate by doing this too? If your son is released as guarantor, that puts the borrower back on the hook so he has a good reason to claim so at least the interest will be removed from his debt.)
I am sorry but you face a complicated choice where there is no 100% right answer because it cannot be guaranteed your son will win his claim.
One thing you can do is to stop paying now and then, as soon as a Scheme or administration starts, at that point settle the debt. ALL payments made in a scheme or administration will be refunded 100% if he wins his complaint, it is payments made before the Scheme or administration that are the problem. If you pay the arrears and start making payments now, or settle the debt in full, you will only get back a tiny percentage in the Scheme and likely nothing in administration.
I would be very surprised if there isn’t a Scheme or administration before Xmas. November seems pretty likely.
Clare Smith says
I’ve stopped paying amigo. Advised my guarantor to cancel direct debit etc. There wasn’t one on his account. He’s had a letter basically saying they are now going to set a direct debit up on his account. Can they do this?
Thanks
Sara (Debt Camel) says
no – he should tell his bank he does not want a direct debit set up and does not want Amigo to have a Continuous Payment Authority over his debit card.
Helen Mills says
That happened to my mum today. I cancelled all my payments, they only had an old card of my mums we have never set up a dd from hers. Then today Amigo have set up a dd from my mums account. Apparently they can do this each month. However bank were so helpful they will continue to cancelled the dd, and they are putting funds back in for my mum
Sara (Debt Camel) says
That is disgusting behaviour by Amigo. Your mum’s bank is doing the right thing, but AmMigo should not be putting your mum under this sort of pressure.
Can I suggest you and your mum should make a complaint about the way the FCA is allowing Amigo to behave like this by removing any means you and your mum have to get complaints resolved. See https://debtcamel.co.uk/stop-paying-amigo-pros-and-cons/
Helen Mills says
Natwest have put the money back into the account, they said they need to get it back from Amigo by proving my mum hasn’t given permission to set up a dd payment. The bank said they might try again for payment next month even though no dd has been signed by my mum.
Sara (Debt Camel) says
Point out it’s not possible for your mum to prove she never signed something.
But say she is happy to sign anything now to say if she gave Amigo permission to debit her account (which she denies) she is withdrawing that permission.
Clare Smith says
He’s rang the bank and they said there isn’t a DD set up on his account but if they do take anything they will get it back. What I don’t understand is I’ve received a letter today giving me till 02/08 to clear the arrears but my guarantors letter says the DD is being set up to take the money 30/07. They really are vile.
aden says
Has anyone else had the following email. seems like stalling tatics
Would you like to help shape how Amigo customers could be compensated?
Our first Scheme of Arrangement was not sanctioned by the High Court. The Judge asked us to increase customer involvement in deciding how a potential new scheme could work and defining what options are most attractive. As a direct response to this feedback, we are putting together an independent Customer Committee.
What is a Customer Committee?
We will select 8 people at random to form a collaborative ‘voice’ of our customers. The selected individuals will provide a representative customer opinion on Amigo’s potential options; including the possibility of a new scheme. A new scheme would define how (and when) we pay customers any valid compensation for loans which were mis-sold, for example due to affordability reasons. We would like your voice to be heard as there are alternative options, which include not doing a new scheme and Amigo filing for insolvency. We would like to have a mix of customers; past and present borrowers and guarantors, to be a part of the committee. The Financial Ombudsman will also be invited to attend, as the largest creditor of Amigo.
Sara (Debt Camel) says
In theory its good for Amigo to know what customers “would like”. Whether this 8 person creditor committee is a sensible way to go about this is highly dubious.
You can only take a good decision if you are properly informed and as the judge in the last court case decided, most Amigo customers will know little or nothing about corporate restructuring.
Amigo says “an independent advisor will provide a detailed overview [to the committe] and any relevant information on Amigo’s options. This will include the possible outcomes of the options, primarily focusing on the outcome for our customers, but also for other stakeholders. As a committee member, your responsibility will be to give thoughts and opinions on the information that you are given. You and other members will discuss and provide feedback.” It is far from clear to me that this bears any resemblance to what the FCA was talking about in court – allowing the committee to have access to professional (legal and accountants) advice.
Amigo and its advisers have already provided pretty misleading explanations about the first Scheme. Will they come clean now? Will they be explaining details that the first Scheme documents skated over – three key ones being:
1) “Why are you planning to impose deductions “for unpaid interest” which FOS never does and how many customers do you expect will be impacted by this?”
2) “what do you expect the uphold rate will be?”
3) why are you valuing write-offs of balance at only £1 – this effectively rigs a ballot against people with outstanding loans?
Without answers to these sorts of questions – which are not directly about the amount of money on offer – asking people to vote on a new Scheme is like asking them to vote to be placed in a lottery as people can have no idea whether their complaint is likely to be upheld by Amigo.
But will Amigo see this as “relevant information”?
And why does it want such secrecy about what the committee is told? This sort of information should all have been publically disclosed to creditors in the first Scheme but was not – by not letting people on the committee discuss this with anyone else, this seems to be compounding the problem, not resolving it.
As you say, this committee will also be delaying things. the committee meeting will not be over before the end of August. Every month Amigo pockets more money in repayments where it will onlt repy a tiny amount if a complaint is upheld.
See https://debtcamel.co.uk/stop-paying-amigo-pros-and-cons/ which looks at whether you should stop paying Amigo and whether you should make a complaint about the FCA allowing Amigo to stop paying refunds for such a very long period.
Tom says
“This means that even if we were to now start investigating complaints about Amigo again, we understand it wouldn’t pay any compensation we awarded. So we’re continuing to pause progressing complaints about Amigo, and we will not be taking on any new cases.”
Quoted from the FOS update for july regarding Amigo loans. This is criminal… amigo will basically refuse to pay out any compensation awarded by the FOS yet they have been given the green light to carry on bullying the people that would have a valid claim to repay their loans!! What the hell is going on!! Are the FCA and FOS share holders in Amigo Loans or what ???
Why are Amigo Loans being given this amount of breathing space yet the real victims are still being bullied by Amigo.
Sara (Debt Camel) says
This is the FCAs fault not FOS’s – FOS will find it very hard to work on cases fairly if Amigo refuses to cooperate and send over case files or respond to FOS questions, and what is the point when the FCA is allowing Amigo to ignore any FOS decisions and not pay refunds?
The FCA needs to change its mind and tell customers with a complaint in that they do not need to pay any more until the complaint has been decided.
People should send the FCA a complaint, not about Amigo but about the FCAs behaviour which is abandoning vulnerable customers to very aggressive debt collection. See https://debtcamel.co.uk/stop-paying-amigo-pros-and-cons/ which explains how to make this sort of complaint about the FCA.
Holmey says
I’ve just received this from Amego:
“Hello P*****,
Would you like to help shape how Amigo customers could be compensated?
Our first Scheme of Arrangement was not sanctioned by the High Court. The Judge asked us to increase customer involvement in deciding how a potential new scheme could work and defining what options are most attractive. As a direct response to this feedback, we are putting together an independent Customer Committee.
What is a Customer Committee?
We will select 8 people at random to form a collaborative ‘voice’ of our customers. The selected individuals will provide a representative customer opinion on Amigo’s potential options; including the possibility of a new scheme.
A new scheme would define how (and when) we pay customers any valid compensation for loans which were mis-sold, for example due to affordability reasons. We would like your voice to be heard as there are alternative options, which include not doing a new scheme and Amigo filing for insolvency.”
It continues, but full too long to post as comment…
I think as many of us as possible should sign up to this an tell them to get to hell, payout what they owe to clients who they have miss sold loans to and to take it out of the shareholders pockets, If they have to go into liquidisation, I’d rather that and take my chance with the administrators than trust them with a new scheme.
An angry Holmey
Michelle says
I got one too !!!
Sara (Debt Camel) says
Indeed. And have you looked at making a complaint about the FCA for allowing Amigo to act this way? See https://debtcamel.co.uk/stop-paying-amigo-pros-and-cons/
Debbie says
https://www.ft.com/content/749c545b-7fa7-447b-a241-0813b1e93fbd
Why are the FCA not protecting customers? Amigo may have a field day with this and there is no end in sight!
Sara (Debt Camel) says
I think that FCA decision is pretty uncomfortable reading for Amigo – as that article says
“it decided not to block the plan in part because Provident has said it will close down the doorstep lending division entirely, meaning that unlike in the case of Amigo, “the group and its stakeholders will not be retaining a valuable stake in a continuing profitable business at the expense of redress creditors”.”
Simon says
Until enough of us cancel our payments and get affordability complaints they are in no rush to resolve this, if everyone stopped paying tomorrow then it sure as hell would be resolved quicker.
I feel sorry for those who receive the intimating messages and threats with court etc and keep paying – ive had this in the past and ended up paying due to the harassment wanting it to go away which led to my situation being worse.
Phil Lockwood says
I consider the way and as often as they have contact me and my guarantor could be considered criminal when it comes to harassment and intimidation offences, if not they are treading a fine line.
How often are they allowed to contact you, how far can they stretch the truth regarding threats to take you to court before they actually cross the line into criminality?
I’m considering reporting them to the police and letting them be the judge of that.
Camille says
I informed beloved Amigos that myself and my guarantor will not be paying!
I asked the status of my claim, and still awaiting a reply
Today I got this.
Camille,
It’s only fair to remind you that soon you may be issued with an LBA (Letter Before Action).
If the arrears are not paid, or an arrangement agreed, soon we will begin assessing your case and if we think appropriate, start preparing for court.
If you would like to discuss how we can prevent this from being necessary, please call me on 01202 629103. Remember we’re not open late at night or on Sundays, so it might be quicker and easier to reply to this message.
Will, Amigo Loans
🤣
Just have to laugh, the.balls of these people!
Dean C says
Don’t worry about any of it. I’m well past their deadline for threats of an LBA and Amigo have done precisely *nothing* except send the same empty threats, just with different words, in the hopes that I’ll somehow “crack”. No danger of that.
Camille says
There you go! I won’t buckle at all!
I will continue to wait for them to sort themseleves out!
Damn muppets.
Daniel Green says
Dear Sarah,
After months of fighting with amigo over my loans and top ups my complaint is still on hold I’ve asked for my mother to be removed from the loan as gaurentour but amigo has stated that she can and will not be removed from the loan as the money was paid in to her account I suffer with anxiety and depression and have been struck off work I’ve agreed with amigo to pay a revised amount but still struggle to pay bills and area’s on other bills can you please give me some much needed advice
Daniel
Sara (Debt Camel) says
So you made an affordability complaint that Amigo rejected? did you send it to the Ombudsman?
What was your mum’s financial situation at the time the last top up was was taken – at that point would she really have been able to afford to make all the payments to the loan and still been able to pay her own debts, bills and living expenses?
What is her current financial situation – does she have other problem debts? Is she buying or renting?
Daniel Green says
My complaint is on hold but it’s definitely a valid claim as for my mother she wasn’t able to make any payment or afford such payments she’s still struggling to pay the rent and household bills without trying to cover any arrears I incurred with amigo I’ve kept paying the revised fees for a couple of months now but I’m still really struggling
Sara (Debt Camel) says
Ok then if your mum could not have made all the payments to this last from when you took it it out, then the loan was unaffordable for her at that point. She will be able to make a complaint to Amigo in any new Scheme and to the administrators if Amigo go bust.
I suggest you read https://debtcamel.co.uk/stop-paying-amigo-pros-and-cons/ and then talk to your mum about you both not paying. You would have to cancel your direct debit to Amigo – she would have to cancel her direct debit and also phone her bank and cancel the continuous payment authority Amigo has over her debit card.
Does your mum have other debts as well that she is having trouble managing? She could benefit from getting good debt advice on this, she can call National Debtline on 0808 808 4000.
Daniel Green says
Not ones that are excessive as amigo but we will definitely look into the advice you have given thank you so much for your help
Sara (Debt Camel) says
Is your mum renting privately or council / housing association?
Daniel Green says
It’s council
Sara (Debt Camel) says
Ok then that means a debt relief order for her may be a very good option. See https://debtcamel.co.uk/debt-options/dro/
This could be soon because of her other debts – in this case you want to stop paying them NOW so Amigo demand she pays them (she can cancel her direct debit and continuous payment authority so they don’t get any money). If she gets aDRO she needs the Amigo debt included and that can only happen after they have asked her to pay.
Or she could keep it up her sleeve as her worst case fallback. So you stop paying now (as you can’t afford it) and she doesn’t pay and then waits for her claim and your claim to be decided in a new Scheme or in administration. If bothe of you lose your claims (so worst case) then she then opts for a DRO.
But if her other financial problems aren’t going to get solved, then a DRO now could resolve them and Amigo now, with no need to stress for the next 6-12 months. National Debtline can talk her through all these options.
Lloyd says
What’s everyone doing with these emails inviting use to be on the committee?
Sara (Debt Camel) says
no harm in putting your name forward! I am deeply sceptical that this will be a real help in getting info out of amigo but why not try/