In October 2020, some customers who had payday loans from Mr Lender are getting emails about a review of their loans.
Mr Lender is carrying out a review of its payday loans over the last 6 years. It says:
Lending practices have evolved over the years. This means that on occasion, a review of previous loans is appropriate to ensure that customers were treated fairly and that we have fulfilled our duty of care as a responsible lender.
We are currently reviewing our historic loan book for all loans taken out between the 1st April 2014 to the 1st March 2020 to ensure the loans were affordable, that we took into account all relevant information at the time, and that our customers received the right outcome. It is therefore important that we have your correct contact details so we can inform you of the results of this review.
So some customers may get offered a refund!
What is “affordable”?
The regulator says that a loan is affordable if you can repay it on time and still pay your other debts, bills and everyday expenses. So if repaying one Mr Lender loan left you so short of money that you had to get another loan from them, or from another lender, or you got into arrears with bills, then the loan was not affordable.
Lenders are supposed to check that a loan is affordable for you before they offer the loan.
The checks only have to be “proportionate” – if it’s your first loan and you only borrowed £150, the lender isn’t expected to look in great detail at your finances.
But if you carry on taking more loans, the lender should have realised you were in trouble. Or if the first loan was very large!
People making affordability complaints can get a refund of the interest they paid on any loans which are decided to be “unaffordable” and negative marks on their credit records deleted. If a lender won’t uphold your complaint, many of them are being won at the Financial Ombudsman.
People asked to confirm their income details
Some people were sent emails explaining about the lending review and saying:
It is therefore important that we have your correct contact details so we can inform you of the results of this review.
Your first instinct may be to be suspicious this is spam and someone is trying to get your contact details.
But it isn’t – this review is real. If you want to confirm this, phone them on 020 8532 1969 – that is the phone number given on Mr Lender’s website.
Now people are asked to confirm income
Some people are now being asked to confirm their income, but often only at the time of a few of their loans.
My guess is these are the loans that Mr Lender is concerned may have been mis-sold because you could not afford them.
I don’t think you have anything to lose by supplying this information. If you don’t get a reasonable offer from the review, you can simply send your complaint to the Financial Ombudsman.
It will be useful if you have your bank statements for the ombudsman. These are easy to get for the last 6 years, even if you have closed an account, so it’s worth asking your bank for these now.
Might you get a second refund?
Some people getting these emails have already made a complaint and had a refund.
It is possible that the review may say that that you should get more…
Mr Lender often used to offer a £25 Tesco or Amazon voucher, or make an offer on only a few loans when FOS would have been likely to uphold more.
I can’t guess how likely this it but it is definitely worth making sure your contact details are correct.
“Should I continue with my complaint?”
Some people who have a complaint open at Mr Lender at the moment have had an email saying:
Please can you confirm if you would like to proceed with your affordability complaint or you if you would like us to review your loans as part of the review of historic loan affordability?
Here I think you definitely want your complaint to continue, for three reasons.
First, if you had loans before April 2014, the “historic review” won’t look at them. But the Financial Ombudsman will very often consider these older loans.
Second, if Mr Lender decided you shouldn’t get a refund, you want to be able to take the case to the Ombudsman. So you need a proper complaint in.
Thirdly, automatic redress programs typically look for a certain pattern of loans to decide when a refund is due. Your case may not fit that simple patter, but when your complaint is considered, it may be clear that you should get a refund. It is hard to imagine a case when a manual complaint would give a lower refund than an automated program.
“I haven’t had an email about this”
There could be a lot of reasons for this:
- sending someone an email asking them to confirm details doesn’t work well if the email address is wrong!
- it may have been put into spam;
- they may be going out in batches and yours hasn’t been sent yet;
- Mr Lender isn’t contacting all customers.
If you have already had a refund from Mr Lender and you think it should have been more or you had a complaint rejected, I suggest you make sure they have your correct details. You can’t just update your details online as this needs a case reference number from the email, which you don’t have. So phone them on 020 8532 1969 or the emails give the following contact address: firstname.lastname@example.org.
If you haven’t yet made a complaint read Payday loan affordability complaints which explains what an affordability complaint is and how to make one. Mr Lender sometimes gave very large loans, so you may be able to get a refund if you only had one or two loans if they were large.