Affordability refunds from loans

The repayments on many loans and car finance are too high to be manageable so people get deeper into debt trying to repay them.

When you applied, a lender should have checked a loan would be affordable for you – often they did not check properly and you should never have been given this loan.

This article describes how to complain, with a template to use.

Many people have won complaints using this. If you win, you get the interest refunded in cash. When you still owe a balance, the interest is removed so you only repay what you borrowed.

These complaints do not hurt your credit record if you carry on making the loan repayments while the complaint goes through.

A quick overview

What types of loans?

• any personal loans, including high-cost lenders, bank loans, and credit union loans;
• you can complain if you are still paying the loans, it has already been repaid, it has defaulted, or you have a payment arrangement/DMP;
• a consolidation loan may have been cheaper than the credit cards it cleared – but it may still have been unaffordable!
• you can also complain about car finance. But if you are still paying car finance, be careful as in some cases early in the car finance you may win the complaint but have the car repossessed – read Car finance affordability – what you get if you win a complaint
• the complaints here do not apply to mortgages or business loans.

What is “unaffordable”?

The regulator says “affordable” means:

you can make the repayments without hardship or having to borrow elsewhere.

For large 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.

You can win an affordability complaint if you have made every payment on time. That doesn’t make the loan “affordable” if you had to use a credit card say as paying the loan left you short.

If your loan was fine at the beginning and only caused problems later when you lost your job or your mortgage repayments went up, you are unlikely to win an affordability complaint as this could not have been predicted at the start.

How does this work?

You make a complaint to the lender, saying the loan was unaffordable and ask for a refund of the interest.

There is a complaint template . You can adapt to say what happened to you. Send it by email.

The lender has up to 8 weeks to reply. Lenders reject many good complaints, so you can send a rejection to the Financial Ombudsman if you know the loan has caused you problems.

Will this hurt my credit record?

Not if you carry on making payments.  If you can’t afford to, ask the lender for a payment arrangement, which will damage your credit score. If you win the complaint, this damage may be repaired.

Complain to the lender

Send a complaint by email

It’s easiest if all communications are by email – free, instant and you have a copy with a date stamp to show the ombudsman.

If your loan has been sold to a debt collector, send your complaint to the original lender not the debt collector.

Find the right email address to use

BANK EMAIL ADDRESSES see this list : email complaint addresses for banks.

CAR FINANCE LENDERS see this list: email address for car finance lenders

PAYDAY LOANS see this other article as there is a better template to use for smaller loans where you borrowed a lot

OTHER LENDERS Here are the email addresses for most large non-bank lenders. There are a lot of smaller lenders, including many Credit Unions. If your lender is not listed, ask in the comment below for an email address.

Abound (used to be Fintern, other brand is Credisphere) complaints@getabound.com
Admiral Complaints@admiralfinancialservices.co.uk
Anico complaints@anicofinancialservices.com 
Avant Credit  emailcomplaints@avantcredit.co.uk
Bamboo Loans complaints@bambooloans.com
Better Borrow  enquiries@chetwood.co
Castle Community Bank complaints@castlecommunitybank.co.uk
Creation customercare@creation.co.uk
Everyday Loans – for loans after 31 March 2021, see Evlo and use the template in this article. It is no longer possible to make complaints about their loans before that date
Evlo (rebrand of Everyday Loans) complaints@evlo.co.uk
Fair Finance complaints@fairfinance.org.uk
Finio Loans (rebrand of Likely Loans) complaints@oakbrookfinance.com
Fluro (used to be Lending Works) cx@fluro.co.uk
Hastings lending@hastingsdirectloans.com
Humm (does not apply to their 0% finances) complaintsuk@humm-group.com
Koyo loans info@koyoloans.com
Lendable/Zable complaint@lendable.co.uk
Lending Stream debbie.gandy@gaincredit.com
Lifestyle Loans info@lifestyleloans.co.uk
Likely Loans – see Finio
LiveLend support@livelend.co
Loans by Mal (Monthly Advance Loans) Complaints@loansbymal.co.uk
Loans 2 Go  read Loans2Go – how to complain
MBNA mbnaonlinecomplaints@mbna.co.uk
Moneyline headoffice@moneyline-uk.com
My Community Bank complaints@mycommunitybank.co.uk
Norwich Trust complaints@norwichtrust.co.uk
Novuna (used to be called Hitachi) ComplaintsTeam@NovunaPersonalFinance.co.uk
Omni complaints@ocrf.co.uk
One Stope Money Shop gary@theonestopmoneyshop.co.uk
Plata complaints@plata.com
Plend complaints@plend.co.uk
Progressive Money complaints@progressivemoney.co.uk
Quick Loans customerscare@quickloans.co.uk
Ratesetter complaints@ratesetter.com
Reevo (now in administration but still complain) complaints@reevomoney.com 
Salary Finance (Neyber) complaints@salaryfinance.com (for loans, not  “salary advance”)
Savvy info@savvy.co.uk 
Shawbrook Customercare.team@shawbrook.co.uk
Snap Finance customer@snapfinance.co.uk
Stream (used to be called Wagestream. For loans , not “salary advance”) complaints@stream.co
Tandem pl@tandem.co.uk
TM Advances info@tmadvances.co.uk
Updraft complaints@updraft.com
Vanquis customer.relations@vanquisbank.co.uk
Wagestream see Stream
Zable loans see Lendable.
Zopa complaints@zopa.com
118 118 Money complaints@118118money.com

Use this template

Email the lender to begin your complaint. Put AFFORDABILITY COMPLAINT as the subject of your email.

Template for you to adapt:

Do you need a payment arrangement now?

If you want an affordable payment arrangement now, add a sentence to the complaint saying this. These complaints may take months to sort out – a payment arrangement can get your finances into a safe place:

• a payment arrangement shows on your credit record, but if you win the complaint all negative marks will be deleted
• talk to a debt adviser such as National Debtline if you want to know more about payment arrangements
• but don’t risk a payment arrangement for car finance or a logbook loan – one would put your car at risk.

Other details you can add

The template above is fine, you don’t have to add a lot more details.

But you can add extra points if they apply in your case, for example

• my bank statements and credit record (attached) show that I was unable to afford the loan repayments.
• 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 was only making minimum payments to my credit card from you.

And some points about top-ups or second loans:

• a credit check would have shown that my finances had got worse since the first loan
• I had said the first loan was to consolidate debt, but you should have seen that this hadn’t happened.

Waiting for a reply

Some lenders send an acknowledgement quickly, others don’t.

You should get a decision from the lender within 8 weeks. If you don’t, phone them up and ask when you will get it – a couple of days is worth waiting for but many responses are rejections, so don’t wait weeks for one, go to the Ombudsman straight away.

Try to get copies of your bank statements from 3 months before the loan to three months afterwards. You can get statements from closed bank accounts, normally going back 6 years.

Also get a statutory credit report now and download it. You can get one from TransUnion. Do this as soon as possible as sometimes the details change, so you want a full one saved to show the Ombudsman later if necessary.

Do not wait until the Ombudsman asks you for credit records or bank statements – you want them ready to hand. They really help your case as they prove your financial situation when you took the loan out.

6 month deadline to go to the Financial Ombudsman (FOS)

This deadline starts when you get the decision from the lender.

6 months may sound like a long time, but it’s easy to forget this if someone in the family is ill, or there is a new baby, or you are trying to move house or just coping every day is hard…

It’s important that you make the time to do this.

There isn’t a template to send off because it’s best to use the FOS online form (see below). It’s pretty easy!

Don’t be put off by a rejection or a poor offer

Sometimes lenders send long, complicated replies designed to make you look as though you should give up:

• if they say the loan was over 6 years ago, see below for “time limits.
• they may say you were going to use it to consolidate more expensive debts – that doesn’t mean this loan was affordable, it was just not as unaffordable as the other debts;
• if the lender said it was your fault because your loan application wasn’t accurate, the lender should have made checks to verify it.

I suggest you rely on your instinct – if the loan caused you problems, send it to be looked at by the Ombudsman.

If you aren’t sure, ask in the Comments below this article.

It isn’t usually worth trying to negotiate with these lenders, you are just wasting your time.

How to send a case to FOS

This is easy with the online form here: send a complaint to the Ombudsman. It asks you for all the details they need.

The main part of your complaint can be a version of what you sent the lender in your complaint. Add any more details you want, including pointing out mistakes in the lender’s reply. Also attach:

• the reply from the lender
• Trans Union statutory credit record
• bank statements starting 3 months before first loan
• do not worry if you don’t have A copy of your credit or finance agreement – lots of people don’t. The lender will supply a copy if FOS asks for it. Don’t delay sending a complaint to FOS while you try to get this from the lender.

Bank statements

Don’t delay sending a case to the Ombudsman while waiting for this information.

If you don’t have the bank statements from the time of the loan application, get them now. And then send them to the Ombudsman, don’t wait to be asked.

You can get these going back at least 6 years even from closed accounts. And you can often go back a lot further with an account that you are still using. Ask your bank if you need statements from further back than you can get in the app.

“Is there a time limit?”

You can’t complain about a loan that started before April 2007.

If your loans from this lender ended more than 6 years ago, then it is very unlikely you will win a case at the Ombudsman.

Lenders will often reject any complaint if the loan started more than 6 years ago. But if your loan was still being repaid within the last 6 years, the Ombudsman may well decide they can look at it. So if your loan started in 2018 and finished in 2023, send this to the Ombudsman if the lender says it’s too old, because it isn’t.

The ombudsman may also look at older loans if you had a continuous stream of borrowing which carried on into the last 6 years. So if you had 2 loans, the first from 2014-17, when it was refinanced into a loan from 2017-2021, the Ombudsman may decide they can look at the earlier loan as well. And if you had two overlapping loans, eg from 2014-2019 and 2017-2022, the Ombudsman may look at both.

Need some help?

Don’t use a claims management company. They are expensive, often incompetent and use a similar template to the one in this article. 

Instead, ask a question in the comments below.

Can you get an overdraft refund?

Refunds from cards and catalogues