On 24 March 2020 Amigo announced that: given the ongoing uncertainty that the economic implications of Covid-19 could have for our customer base, Amigo has taken the decision to temporarily pause all new lending activity, except for lending to key workers in exceptional circumstances. This article looks at why Amigo decided to do this and why other lenders, particularly high cost lenders to … [Read more...]
Board room bust-up at Amigo
On 4 March 2020 the founder and majority shareholder of Amigo, James Benamor, resigned from the board which he had only rejoined in December. In the evening he published a blog saying that the company was "committing slow motion suicide". Benamor said the board needed to choose between challenging recent FOS decisions on affordability complaints in court by Judicial Review or accept that … [Read more...]
How the borrower of a guarantor loan can complain
Guarantor loans are very expensive. Often the lender didn’t check properly that you will be able to manage the loan repayments without having to borrow more. If proper checks would have shown that you couldn't afford the repayments, complain! There is a template letter in this article to help you. You can get an existing loan reduced so you only repay the amount you borrowed, or get a refund … [Read more...]
90% of guarantor loan cases won at Financial Ombusdman
The Financial Ombudsman (FOS) complaint statistics for Oct-Dec 2019 have just been published, see Product Complaints Data. For guarantor loans, FOS decided in favour of the consumer in 90% of cases: this is even higher than the 83% that were won in April-Jun 2019. these figures are a dramatic increase from the uphold rate of only 32% for the 2018 financial year. This … [Read more...]
Amigo have only offered a partial refund – what should I do?
In the last few weeks, several readers have been offered a "partial uphold" by Amigo. Here are some examples: Amigo only accepted my complaint about the first and final loans which were both relatively short. [Amigo] have upheld loans 2, 5 and 6. I have had around 6 with [Amigo] including top ups they have rejected the ones I paid off previous to the loan outstanding now This isn't happening … [Read more...]
Amigo’s half year results – the rising cost of paying refunds to customers
Amigo's half-year results for April-September 2019 show a big increase in complaint costs about its guarantor loans. The majority of these complaints are affordability complaints, by the borrower or by the guarantor. Here is the management presentation on the results. What Amigo says about complaints Here my thoughts on some of the points Amigo makes about complaints in the management … [Read more...]
Can guarantor loans be included in DRO / IVA / bankruptcy ?
A reader asked: I have 5k debts and I’m now on ESA. I'm also a guarantor for my mum's Amigo loan - could that be included in a Debt Relief Order (DRO)? There are three types of personal insolvency in England: bankruptcy, IVAs and DROs. Normally if a debt can be included in one form of insolvency, the same applies to the other two. But for guarantor loans, it's more complicated. So this … [Read more...]
Amigo – Q1 results show more complaints being upheld
On 29 August, Amigo published its financial results for the April-Jun 2019 quarter. I wanted to see how Amigo was going to refer to the very high percentage of complaints against it which have been upheld by the Financial Ombudsman - see 83% of guarantor loan cases won at Financial Ombusdman - and whether Amigo is making any changes because of this. The Amigo announcement Here are some … [Read more...]
“I have a CCJ from Amigo – is it too late to complain?”
A reader asked: I agreed to be the guarantor for a loan for a friend, but he lied to me and couldn't pay it. Amigo were very difficult, wanting me to stop paying other debts so I could pay them, and got a CCJ. Is it too late for me to complain and ask to be removed as the guarantor? Guarantor lenders have a reputation for being very fast to go to court when a guarantor doesn't pay them. People … [Read more...]
How to complain when you are the guarantor for a loan
If you are a guarantor for a loan you can ask to be removed as the guarantor: if you couldn't afford to repay the loan without difficulty; or you were pressured into becoming the guarantor; or you didn't understand the implications of being a guarantor. This article has a template letter you can use to complain to the lender: you can complain if the borrower is still paying the … [Read more...]