The repayments on many loans from bad credit lenders are too high to be manageable so people get deeper into debt trying to repay them.
If you have an unaffordable loan, you can complain and ask for interest to be removed from your balance. If the loan has been settled, you can ask for a refund of the interest you paid.
This article describes how to complain, with templates.
NB the complaints here are for normal loans. If you have a guarantor loan, read Refunds from guarantor loans as it’s very different, and the guarantor may be able to complain as well.
Like payday loan refunds – with some extra twists
The regulator says for a loan to be affordable:
you have to be able to make the repayments without hardship or having to borrow elsewhere.
This is the same test as for payday loan refunds. Many people have successfully adapted the payday loan refund template letters to get money back on large loans from bad credit lenders such as 118 118 Money, Everyday Loans and Avant Credit.
That letter emphasises the problems that repeat borrowing caused. It’s a strong point in favour of payday loan complaints and why I always say that it’s hard to get a refund if you only had one or two loans from a payday lender.
That sounds like bad news for these complaints about large loans, where you normally only have one loan plus possibly a top up or two…
But the good news is that because these loans are larger and longer term, the lender should have made better checks before giving you the first loan!
Making a complaint and asking for a refund
There is a four stage complaints process for these large, bad credit loans:
- Get a copy of your personal information from the lender.
- Put in a detailed complaint.
- Consider lender’s response.
- Send the complaint to the Finanical Ombudsman.
Complain 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. So here are the email addresses to use for the main lenders:
Avant Credit emailcomplaints@avantcredit.co.uk
Bamboo Loans complaints@bambooloans.com
Everyday Loans complaints@everyday-loans.co.uk
Likely Loans loans@likelyloans.com
Moolr admin@moolr.co.uk
On Stride support@onstride.co.uk
Savvy info@savvy.co.uk
118 118 Money complaints@118118money.com
Stage 1 – ask for personal information
This first stage lodges an affordability complaint and starts the clock going on the 8 weeks a lender has to respond to you. Put AFFORDABILITY COMPLAINT as the title of your email.
You probably already know when you took out the loan and any top-ups. But it’s good to ask the lender to send you a copy of all the personal information they have about you.
Sample email:
I am asking you to refund the interest and any charges I paid, plus statutory interest, and to delete any negative information from my credit record.
[delete if you have repaid the loan] I would also like an affordable repayment plan to be put in place if I still owe a balance after this refund.
To help me explain the details, I am making a Subject Access Request (SAR) for all the personal information you hold about me including, but not limited to, my applications, all credit and other affordability checks, a statement of account for my borrowing, and a record of all phone calls. I understand you are not allowed to charge me for sending this information.
While you are waiting for this, assemble some other information that may help your case. Get copies of your bank statements from 3 months before the first loan.
Dpwnload a copy of your Noddle free credit report. Use this to do two things for each loan or top-up you took:
- make a list of all your outstanding credit when you applied – all the credit cards, loans, payday loans, overdraft. You want to the details of how much you owed in total and what your monthly payments should have been;
- make a list of credit report problems that would have showed in the 6 months before your application – new defaults, missed payments, arrangements to pay, DMPs, insolvency.
Also read Payday lender says I lied. That looks at the various reasons why you may not have given an accurate account of your income or expenses. People have won complaints where they lied because they were desperate but there are other reasons too, so think what (if any) may have applied to you.
Stage 2 – give complaint details
When you have the SAR back from the lender, you can look for things that the lender knew but chose to ignore or didn’t ask about.
Change this template so it reflects what happened to you, both why the loan was unaffordable and why the lender should have realised this. Where I have given some options, delete them all and put in another one if that is more accurate.
No-one will include all these points. It is better to write a short complaint pointing out real problems than send pages telling the lender general stuff they already know.
You can see from my bank statements and credit record that I was unable to afford the loan repayments. [Delete if not relevant] [For example, I had to borrow from X payday lender and I defaulted on my Y debt.]
When I completed the loan application, I understated some of my expenses. This was because: [put what actually happened! this could be something like] I wasn’t very aware of the amounts I was spending and completed the application hastily. OR I wanted to hide the fact I was spending a lot of money on gambling/cigarettes/alcohol. OR I was desperate and wanted to make my expenses sound low so you would give me the loan.
FCA’s CONC 5.3 says that you should not accept an application where you ought reasonably to know the figures are not truthful, you can’t rely solely on information on an application, and that you should not accept information which is inconsistent with what you know. This was a larger loan, you knew I had poor credit and may have been in a difficult position so you should have tried to verify details. If you had done this, you would have rejected my application. For example [delete or add to these as appropriate]:
- You should have noticed that some figures were implausibly low, for example: x,y,z
- I didn’t include amounts such as [delete/add as appropriate]: car insurance, TV license, opticians and dental costs, presents]
- My bank statement would have shown that I was spending more than the application said. Either you saw my bank statement and ignored this or you never asked for my bank statement to verify this.
- During a telephone call, your agent talked me into agreeing that some figures should be lower in order to get my application accepted.
- Your application didn’t ask me for details of my other credit commitments and I didn’t realise I had to include them.
- You should have seen that the figures I put in for other credit commitments were inconsistent with my credit record.
When I applied for a second loan/a top-up [delete/add as appropriate]:
- you ignored the evidence on the credit check that my position had got more difficult OR you didn’t do a new credit check. If you had done this you would have seen the new credit I had taken out and the new problems showing on my credit record.
- you didn’t ask if my income or expenses had changed, and they had.
- you didn’t ask for bank statements so you could check if the new repayments were affordable.
- I had said the first loan was to consolidate debt, but you should have seen that this hadn’t happened.
- you increased my interest rate, showing you realised I was in a more difficult position but you did not check whether I could actually afford the new repayments.
You may think that’s a lot of work or you don’t want to mention a lot of these things to a lender. It’s up to you, you can just put in a brief complaint and give the Ombudsman fuller information later. But going into details has worked for some readers.
Stage 3 – consider lender’s response
You should get a response from the lender within 8 weeks.
Normally you can tell straight away if a response is acceptable or not good enough. If you aren’t sure, ask what other people think in the Comments below this article.
Don’t be put off by a rejection, or the lender suggesting it was your fault because of your loan application. As the complaint letter says, lenders are obliged to do checks. For one small payday loan, these checks could have been brief. But for your large loan, the lender should have made sure they knew enough to be confident you could afford it. If they didn’t, send your case to the Ombudsman.
If you think there is something very wrong with what the lender said, perhaps some information they have completely ignored, you could go back and point this out. Say you would like them to look again at this and you will send it to the Ombudsman in a week if they haven’t come back with an improved offer.
Stage 4 – send to Financial Ombudsman Service (FOS)
I suggest you use the “do it online” option to 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 Stage two. Add any more details you want, including pointing out if you think there are errors in the lender’s reply. You should attach the following:
- the reply from the lender
- Noddle credit record
- bank statements starting 3 months before first loan.
Your complaint will first be looked at by an adjudicator. If either you or the lender reject the adjudicator’s decision, it will then be looked at by an Ombudsman.
“Is this really going to work?”
Here are some recent comments from people who have had refunds for this sort of loan. They show how some people get a good result directly and others have to go to the Ombudsman. Don’t assume a rejection by the lender means you can’t win!
Andy: A flat out refusal from 118118 Money. One loan (£1,000) plus one top up (£2,500). Stating they had done nothing wrong, all payments made on time and paid top up loan off early. Saying I had a good income, verified by a bank statement and they had phone call recordings that I had made it clear the repayments were affordable.
Sent to FOS as I was in loads of debt at the time, loads of repeat pay day loans etc. Didn’t hold out much hope but thought I may get a positive decision on the top up loan. Adjudicator held in my favour on both loans. 118118 accepted decision and offered circa £800. I had my loan statements and the total interest (plus 8% interest) was nearer £1,300. Adjudicator queried this for me with 118118. They agreed with my calculations. Adjudicator gave them 28 days to pay. It was in my bank the very same day.
Dan: I had a complaint upheld by the adjudicator at the Ombudsman against Avant Credit: Refund of all interest and 8%, £75 compensation, removal of loan from my credit file. Avant Credit agreed with the adjudicator.
Louise: Have had my response from Everyday Loans and complaint upheld. All interest been removed and I only have to pay back what they lent. Excellent outcome. Lent 5000 and have paid 3k so just 2k left to go. On my DMPthe balance was showing at 6.5k still left. Took them 5 weeks to uphold my complaint a lot of emails going back and forth.
Soph: Had 2 loans from Avant Credit. Rejected within 2 days, sent to FOS Jan, upheld in March, Avant agreed with FOS and refund in the bank within 7 days.
Robert: I was successful in getting all interest wiped from my topped up loan with 118 118, didn’t go to the FOS or anything.
“What about a bank loan?”
The affordability test is the same – could you repay the loan without getting deeper into debt elsewhere. But there are two problems with normal bank loans:
- their interest rates are lower so it’s harder to show that the smaller repayments are unaffordable; and
- if your credit record was OK or even good, the bank wouldn’t have been alerted that way to the fact you may have difficulty.
So it can be hard to win a case involving a typical bank loan, especially if your credit record was OK. But if you want to try, you can use the template letters here.
Need some help?
If you need help to complain, go to your local Citizens Advice, they will help for free.
Don’t use a claims management company. They are expensive and often incompetent. A good claim involves telling your own story, not sending a standard letter!
Getting a payday loan refund if you owe money
What to put in an affordability complaint
Examples of gambling & payday loan refunds
Brad says
118118 money have written off all interest from my current loan and deleting it from credit file. Just had a response 8 hours before the 8 weeks was up. Happy with that though.
Freddie says
Great Brad, was it a normal loan or a payday loan? I had one with them a couple of years back and am awaiting a response.
Brad says
Just a normal loan. I had one in 2014, took out another in 2016 and then refinanced it in 2017. They wrote off all interest on the last two which was £3,650. Said they could have done more checks.
Kaz says
Update: 118 118 Money agreed to my complaint. Issued a full refund of interest and has taken the defaults of mt credit file.
Really pleased with the outcome.
kayleigh says
How long did they take to reply to you? I have a complaint with them, emailed 3 weeks ago.
Kaz says
Hi Kayleigh, they took the full 8 weeks to respond but were really helpful! One of the best I dealt with and only had 1 loan with them :)
louise says
Hi, I received mine today from 118 and going to Ombudsman.
I have two rolled loans and they have stated that it is up to myself to ensure they are affordable – took 8 weeks also.
I personally think they pick and choose and I asked for the call they mentioned in loan 1 sent a copy and now they can’t?
Andy says
Has anyone had reply’s from advant credit for refunds , as rejected within one hour of complaint
Louise says
Seems to be their standard – go to Ombudsman I did and partially upheld – mine was a difficult scenario however, I found them to be horrendous – even when I called them.
Soph says
Hi Andy, yes I had 2 loans with them. 1 for £1000 repaid after a few months by further borrowing from 118118 and another for £2000 a few months later again repaid by further borrowing. They rejected my complaint within 24 hours. I sent them to the FOS in January, it was picked up by an adjudicator in March who upheld both loans. Avant agreed and refund received within 7 days.
Andy says
Hi soph, I am in exactly same boat, borrowed 2,000 repaid with 118 , it was picked up by adjudicator last week , so fingers crossed as had 8 other payday loans before this larger borrowing , thanks for the reply guys ????
Tim says
Hi
Has anyone had any success getting a refund from 118money . I am just wondering if it’s worth pursuing?
Robert says
Hello,
I was successful in getting all interest wiped from my topped up loan with 118 118, didn’t go to the FOS or anything
Jen says
I was successful they refunded interest on 1st loan but not the second
Andy says
Hi
I had a flat out refusal from 118118 Money. Went to FOS and Adjudicator has recently ruled they should refund interest on original loan and my top up loan. He is now waiting for their response. I didn’t hold out much hope when they flat out refused my complaint but based on my experience it’s well worth considering referring it to the FOS if they don’t make you a decent offer direct.
Lee says
Hi, i have a £1000 loan with 118 and likelyloans but never topped up but I am currently in arrears with them both is it both trying this on the still?
Sara (Debt Camel) says
Yes definitely! People have had refunds for a single loan. Also whoever you borrowed from second should have seen the other loan!
Ljc says
Hi Sara
About 10 years ago I had a large loan of around 20k with welcome finance , they also put a charge on my property . When I sold my house in 2013 they accepted a payment of around 15k and removed the charge from my property so it could be sold . I still owe them around 7k and pay them a £1 a month , I think it’s to their debt collectors . During the period I had the loan , a lot of the monthly payments bounced or I had to pay reduced amounts because my finances were a mess , borrowing left right and centre . Could I use this for this as I would say it was irresponsible lending . Thank you
Dan says
Hi Sara
It’s great you’ve used my success story above :)
Couple of things that helped my complaint was my low credit score and having used a few pay day loans around the time of avant credit giving me the loan. The adjudcator felt this should of been a warning sign if they had carried out the proper checks. And decided the loan was unaffordable. This was a 1 loan case.
Dan
Sarah Castleton says
Has anyone had any success with Cashconverters loans?
Dean says
Hi Sara,
I have adapted my payday loan complaints and filed a complaint against safetynet credit. Do you think this would work?
I also want to file one against step stone credit
Thanks in advance
Carl says
I’ve just heard back from safety net. They lent to me when I had 4 other PDL’s. No quibble or disagreement, simply refunded all interest paid, added the 8% and left the £500 that I owed as £111.
Try it, you nothing to lose.
Dean says
Aweosme!!!! Thank you Carl. I had 10 PDL’s and I owe them £735 credit went from £300 to 600 available to me in no time at all.
Fingers crossed. I submitted a complaint yesterday and they acknowledged it today. What time scales did you experience?
Carl says
Contacted me on Friday and I sent the email to them on the 5th August, so pretty fast. I did have to verify my email address with for Data Protection whuch is uderstandable.
Good luck.
Carl says
About a year ago I had a totally unexpected letter from NatWest saying that there had been an irregularity with an old, settled loan and that they were crediting my account with just over £1k. Too good to be true? I thought so but upon checking the account the money was there.
I had £1700 overdraft, 2 £500 credit cards all maxed out and they offered me a consolidation loan of £2800 to be paid at £80 a month. At the time it was perfect and I had no choice. It did take 4 days for the loan to be authorised, probably because of my abyssmal credit rating.
To cut a long post short, NatWest refunded mine without even asking! Check all credit not just “bad” lenders.
Sara (Debt Camel) says
if you had missed payments to this loan, the odds are that this generous credit has nothing to do with the loan’s affordability but arose because of a technical issue known as NOSIA – notice of sums in arrears – a formal annual notice which they probably forgot to send to you.
Carl says
I did miss payments but the amount seems high for missing an annual notice.
I might see what I can get for the interest etc from them.
Kaz says
Hi first thing I need to say your website is amazing has helped me already- everyday loans gave me loan knowing that I had a gambling problem 2 years , they saw my banks statements and everything- do you think I have case of irresponsible lending or not please can you email asp thank you again
Kind regards
Sara (Debt Camel) says
I think giving a large loan if a lender is aware you have a gambling problem is irresponsible. So as Everyday Loans saw your bank statements, assuming that there was a lot of gambling showing, then this sounds like a good case!
Some people are reluctant to tell a lender they had a gambling problem when they complain, thinking they will be blamed for not being able to afford the loan. But you should make this point strongly, saying that EL should have refused you the loan because of what they knew about your expenditure.
Chelsea Armstrong says
Hi,
I got a 2k loan from Everyday loans 3 month ago. I have several loans with several Payday loan companies at the time and this loan was to ‘consolidate’ my debt. I am in a worst situation now. They looked at my bank statements but ignored all my spending and only looked at the outgoings. Do you think this is worth making the complaint?
Sara (Debt Camel) says
what sort of spending did they ignore? did you pay off other debts with the money?
Chelsea Armstrong says
Well they didn’t seem to take notice of where my money was going or what my income was at the time. All they asked for was who else I owed money to and when. I was experiencing a lot of anxiety at the time and couldn’t use public transport therefore I was spending at least £200 a month of taxi’s.
I paid off most of the small payday loans I had at the time with the £2,000.
There are still several I Am still paying from that time as well as new loans taken out since. They also ignored me when I told them I have another large loan (£2000) from Ikano Bank.
Sara (Debt Camel) says
£200 a month on taxis is a lot – they should have queried it or taken it into account.
Well if you told them on the phone then they should have a recording of that. As the article above says, start of my sending then a Subject Access Request for a copy of all your personal information.
Ljc says
Hi Sara
I’ve posted this again as I wasn’t sure whether you’d seen it …
About 10 years ago I had a large loan of around 20k with welcome finance , they also put a charge on my property . When I sold my house in 2013 they accepted a payment of around 15k and removed the charge from my property so it could be sold . I still owe them around 7k and pay them a £1 a month , I think it’s to their debt collectors . During the period I had the loan , a lot of the monthly payments bounced or I had to pay reduced amounts because my finances were a mess , borrowing left right and centre . Could I use this for this as I would say it was irresponsible lending . Thank you
Tony says
Good afternoon,
I raised an affordability complaint with 118 last Sept, to which they gave what I thought was quite a comprehensive response and as such, I didn’t raise to FOS which after reading this I feel was a mistake.
Is there any chance that if I raise this now, as the 6 months is well and truly up, that it would still be considered?
Cheers
Sara (Debt Camel) says
Very unlikely. Unless they said something in their reply that was factually wrong and misleading. Or they failed to tell you you could go to the Ombudsman. Or exceptional circumstances eg major health problems.
Cal says
Hi all,
I have a £2k loan with everyday loans. I have had this for 5 months and missed one payment date but paid later in the month. At the time of applying I had 2 defaulted accounts that weren’t settled and 4 active credit cards that were maxed out. They offered £1.5k initially but said they’d stretch to £2k if I promised I could definitely make the repayments. I’ve paid back £1,425.5 to date as it’s only over a 12 month period of repayments. My question is, would they argue that I’ve paid 4/5 times on time therefore it is affordable?
Many Thanks
Cal
Sara (Debt Camel) says
The fact you made the payments does NOT prove they were affordable.
The regulator’s definition of affordable is that you should be able to make the repayments on time without hardship and without borrowing more. So how have you managed in the last 5 months – have your other debts, including your overdraft usages and arrears on essential bills such as utilities, gone up? If they have, then that shows the loan isn’t affordable.
“said they’d stretch to £2k if I promised I could definitely make the repayments” I think I will dub that the scout’s honour approach to affordability checking – it’s not normally recommended, people desperate for money will obviously say of course they can afford it.
Cal says
Thanks Sara. I still have the 4 credit cards that are highly utilised and have an overdraft that is predominately used. I’ll begin my complaint with them.
Sara (Debt Camel) says
If you are struggling each month, I suggest you also talk to StepChange about a debt management plan: https://www.stepchange.org/how-we-help/debt-management-plan.aspx in addition to making affordability complaints. It can take months for complaints to be resolved, a temporary DMP will put you in a safe position during this period.
Tom says
Just received an email from AvantCredit offering a full refund on interest and any charges +8% interest. This loan was settled in 2016 and was one of the ones I wasn’t expecting anything back on. Thanks Sara
Sara (Debt Camel) says
Nice one!
Squeak says
Just had a reply from 118, full refund on interest on my top up loan of £3800 (which is still being paid back in my DMP so just a reduction on what I owe) and removal of the loan from my credit file but they rejected it on the original loan. Interestingly they only upheld the complaint as “unfortunately, due to a technical issue we are unable to view the credit file that was used to make a decision on this application and therefore, we cannot fairly defend this aspect of your complaint. Please note that this aspect of your complaint is being upheld purely because we cannot obtain the information needed to review this part; not because we have done anything wrong.”
But I’m very happy with the outcome, It’s slashed a quarter off my debts :)
Ross says
Hello! I’m in need of some help! For the past 2 months I’ve been struggling with my 118 loan repayments. I have emailed them informing them and have filled in a budget sheet and done everything they had asked me to do. When I phoned them to confirm my direct debt details they basically told me there was nothing they could do and yo phone another number and ask for advice. The emails I received heading upto this phonecall told me they could give me a repayment plan but now they seem hesitant to do anything. Yesterday I sent them an email complaining using the template s above and asked for the information they had on me. I received an email with a statement for my current loan but they told me my old loans were closed so they couldn’t provide any details on them but I could access them from the website. Nothing about a payment plan, nothing other then the attached statement of my current loan.
What do I do now? Do I press then harder about a payment plan and for more information? Help!
Sara (Debt Camel) says
Go back to them and say “I have asked you for a copy of all the personal information you hold about me including, but not limited to, my applications, all credit and other affordability checks, a statement of account for my borrowing, and a record of all phone calls. This is a Subject Access request. You are obliged to provide me with this information or I will register a complaint with the ICO.”
Also cancel the DD or CPA to 118 Money with your bank. You are not ASKING them any more for an affordable repayment plan you are TELLING them you can’t carry on making the loan repayments.
Ross says
Thanks Sara, I had asked for an SAR in the original complaint email yesterday but I will email them again insisting they look at it. I’ll sent that today and I will keep the page informed on what happens.
I will go down to the bank and speak to them iver the weekend as well and have the payments stopped. I’ve asked them for the payment plan for about 2 months now and nothing has happened.
Thanks!
paula adam says
i had a 118118 loan for £2500 at 78.9 % interest i took out a credit union loan to pay it off as the interest was so high , i then took another from 118118 a month later and got in such a mess i had to go on a dmp would i be entitled to start a complaint for a refund
Sara (Debt Camel) says
I think it sounds as though the first loan was unaffordable for you. And 118 Money should certainly have looked closely at your second application so soon after repaying the first.
Laura says
Hi,
I got a loan from Bamboo earlier in the year, asked for £3000, but allowed me to have £2300. So all together £2396.86 in interest (more than the loan itself lol) and total of £4696.86 to pay all together. Have made payments since March of this year, 3 years of £130.47 a month. Already owed £13,800 before taking out the loan (to pay off some payday loans and home improvement). Extreme struggle to pay this loan payment without getting payday loans etc due to other debt commitments. Complained on 23/08/2018, 8 week deadline was 18/10/2018. Had a phone call from Bamboo today, they missed a payment when they did credit and affordability check so complaint upheld. All interest removed and just have to pay what I borrowed (minus payments already made). Have to send an income and expenditure form to adjust monthly payments, as can’t afford them, but am so pleased. Only took them a month and no going to FOS :-) and the lady I spoke to was lovely.
Sara (Debt Camel) says
what a good result for you!