The Financial Ombudsman (FOS) has recently published two important decisions about guarantor loans, one where a borrower complained and one where the guarantor complained. I have covered the borrower case here: Ombudsman – Amigo did not check properly that a borrower could afford the loan. This article looks at the FOS decision about the guarantor for a loan. I have selected points from the … [Read more...]
Ombudsman – Amigo did not check properly that a borrower could afford the loan
The Financial Ombudsman (FOS) has recently published its decision on Miss G's complaint against Amigo. This FOS decision criticised Amigo's inadequate assessment of Miss G's income and expenses. It said her poor credit record meant Amigo should have verified the figures, for example by looking at bank statements. So FOS ordered Amigo to refund all the interest and charges she paid, plus 8% … [Read more...]
How Subject Access Request information can help an affordability complaint
If you are making an affordability complaint about a large bad credit loan (that includes logbook loans and car finance) or a guarantor loans, 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). Lenders used to charge people £10 for this, but it has all been free since GDPR changes last … [Read more...]
Amigo guarantor loans – more refunds being paid!
In May 2019, adjudicators at the Financial Ombudsman (FOS) made several dozen decisions upholding affordabilty complaints by people with Amigo loans. So far as I know, Amigo has accepted all these decisions and has paid out refunds. These adjudicator decisions are not published by FOS but readers have sent me copies of them. This article has some extracts so you can see what FOS is looking at … [Read more...]
Panorama’s “Easy money, Tough debt”
Panorama on 17 June 2019 showed Easy Money, Tough Debt? It's on iPlayer for 11 months if you missed it. It covered a wide range of high cost borrowing, with stories from people who had problems with payday loans, with high-cost credit cards and catalogues, and guarantor loans, with a borrower and a guarantor being featured. Everyday stories of high cost borrowing For a debt adviser, these … [Read more...]
Guarantor loans – why guarantors & borrowers need extra protection
Guarantor loans are coming into the regulatory spotlight. The FCA wrote to CEOs in March 2019 saying it will be looking at affordability and whether potential guarantors have enough information to understand how likely it is that they may have to make the loan payments. In a speech, Jonathan Davis said: Recent work we have done in this area showed that many guarantors are making at least 1 … [Read more...]
Are you worried about a charging order?
Can your house really be at risk if you get into difficulties repaying something like a credit card bill? You might think the answer is "no", but there are some very rare situations where this can happen. It helps to know the facts, so you can make good decisions about how to deal with your debts. To be able to sell your house a creditor has to: start by getting a County Court Judgment … [Read more...]
Guarantor loans – open to financial abuse #IWD2019
Guarantor loans are wide open to financial abuse, where the guarantor is pressured into agreeing to the loan, often without full knowledge of the borrower's situation. This can take many forms, but today, for International Women's Day 2019, here are some recent comments from women who were bullied into agreeing to be the guarantor for their partner or their ex-partner. I was bullied … [Read more...]
Amigo loans – not a good way to try to improve your credit score
Have you heard that a guarantor loan is a good way to improve a bad credit score? That isn't good advice. There are big problems with guarantor loans and there are much better ways to improve a bad credit rating! If you already have a guarantor loan, or you are the guarantor for someone else's loan, see the bottom of this article where I look at what your options are. Many people want to … [Read more...]
News snippets about high cost credit
This page brings together news items about various types of high-cost lending in Britain, including payday loans, guarantor loans, doorstep lending, logbook loans, rent to own and other forms of high-cost credit. In March 2019, the FCA sent a letter to all high cost credit lenders except overdrafts and credit cards outlining its strategy for supervision for 2019 and 2020 - my comments … [Read more...]