If you are making an affordability complaint about a large bad credit loan (that includes logbook loans and car finance) or a guarantor loan, my template letters start by asking the lender to send you a copy of all your personal information.
This is often called a Subject Access Request (SAR). Getting thus data has been free since 2018.
So what do you do when you get this SAR information?
Why do you ask for a SAR?
Lenders only have to make “proportionate” checks that you can afford a loan.
With payday loans – small and short term – a lender doesn’t have to make detailed checks on the first few loans. Your repeat borrowing is the strongest point in your complaint. This is why most people with a payday loan complaint don’t need to bother with a SAR.
With large loans, the lender should have made careful checks you could afford it even if you only borrowed once. Sometimes the data you get in a SAR will help you show that they didn’t.
It’s best to ask for the SAR data at the start of your complaint because it can take time to be sent the details. And you want them there, ready, in case they are needed … but for many people, they won’t be.
You don’t have to do anything!
Your affordabilty complaint is already underway. The lender has to accept or reject your complaint within 8 weeks from that first email.
You don’t have to do anything else during this 8 weeks. If the lender makes you a good offer, you will never need the SAR information at all.
If you get rejected or a poor offer, you can just send your complaint to the Ombudsman as it is. FOS have looked at a lot of affordabilty complaints and they will ask you for more information if they need it.
If it looks as though your FOA adjudicator doesn’t understand your case, at that point you can dig through all the SAR information and use that to explain your case further.
Or you can use the SAR to explain your case in detail
But some people like to send a detailed complaint to FOS.
If you think your case is complicated or the lender is difficult, you may feel that it’s good to help your adjudicator at FOS by summarising the important points. And then the SAR can provide evidence for you.
Organising the data – is it all there?
If you have been sent a lot of paper, or digital files, it’s good to go through it quickly to see what there is, sort it into date order, number each document and make a list. An example:
- application form for loan £1,500 on 13/03/2016
- credit check on 13/03/2016
- consumer credit act agreement 13/03/2016
- top-up application for £1,000 on 20/11/2016
- phone call about arrears 10/02/2017
- arrears letter 20/02/2017 etc
This may show that some things are missing. Why is there no copy of your application for the third top-up? No credit checks?
Sometimes you may not care. You may not want recordings of all your phone calls unless you think the lender was being misleading or too aggressive in them. But if you are interested in something and it isn’t there, go back and ask the lender for it.
And if the lender starts referring to other documents at FOS, ask why you have not been sent these.
Don’t let the lender fob you off by telling you to get your credit report from the credit reference agency (CRA). This is wrong for two reasons:
- you want the credit report details at the time of the lending decision, not now. It isn’t possible to get a backdated report from a CRA.
- the information the CRA sends the lender, including your credit score, is NOT the same as what you can see on a credit report. You want to know what the lender was given.
What to look for if you just had one loan
You are looking for two things.
First, any points where the lender failed to get a good income and expenditure details from you. This could be because they never asked about some expenses, or they put in too low a figure from some other source or you gave too low a figure and the lender just accepted it.
Second, any discrepancies. Things where one thing the lender can see doesn’t match against something else, so the lender should have looked in more detail.
Here is a long list to think about. For most people only a few of the points will apply, so it’s not as difficult as it seems!
Also you are the expert here, there may be something that matters for your situation that I haven’t mentioned.
Your SAR information can help with making points about affordability in all the ways discussed above.
If you are the guarantor for a loan, the lender has to check you would be able to afford the repayments out of your income if the borrower defaulted.
The lender can’t just accept you as guarantor because you have a house with equity – that reduces the risk to the lender but doesn’t mean the loan is affordable for you.
Were you reliant on the borrower in some way?
This additional point can help if you were financially linked to the borrower in some way. For example, they may pay part of your rent/mortgage/household bills, you may have taken out a loan or car finance for them that they are repaying, they may pay you child maintenance.
In all these cases, the SAR should show that the lender considered what your finances would be like if the borrower stopped contributing in this way. Because if the borrower loses his job or stops having any contact with you, you won’t just have to make the guarantor loan repayments – often you will be having to cover more or all of the household expenses .
So does the SAR information show that the lender considered what your situation would be in this situation?
Other reasons for guarantors to complain
And guarantors can also complain about other matters eg the obligations of a guarantor were not properly explained to them. Here the recording of the phone call can help:
- the phone call may have been brief, not thorough enough. You may have been at work and not be able to go into details.
- it may have been clear you didn’t know much about your expenses. It’s actually common for people to have little idea what they spend on food or clothes or running a car – the lender should have spent time trying to get realistic figures and tried to verify what you said. And for some people this is harder because they have problems with numbers or making financial decisions.