The main reason for redress in the UK is unaffordable lending. Unaffordable lending means lending that the borrower could not reasonably afford at the time it was taken out. Lending money without checking affordability is known as irresponsible lending. If you were only able to repay your high-cost loans by juggling other loans or credit cards to get through the month, then your lender may not have made appropriate checks.
“The firm must consider the customer’s ability to make repayments under the agreements without failing to make any other payment the customer has a contractual or statutory obligation to make, and without the repayments having a significant adverse impact on the customer’s financial situation."
Signs that your loan(s) may have been unaffordable include:
You frequently consolidated loans or borrowed shortly after repaying a loan
Your loans from a single lender were regularly increasing in size
You missed some repayments
You made some repayments late
The loan repayment was a substantial part of your disposable income
You were using one form of debt to fund another.
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You do not need to use a claims management company to make your complaint to your lender. If your complaint is not successful you can refer it to the Financial Ombudsman Service yourself for free.
General signs that you may be entitled to loan compensation
Fees or charges not clear?
When you took out your loans were the charges and associated fees made absolutely clear to you?
Unable to pay bills?
Your payments for the loan were so large that you struggled to pay for your monthly essentials like bills or mortgage payments.
Rolling over loans?
You had to take out a further loan to pay the initial one back, supporting unaffordability.
Lenders taking automatic payments?
Automatic payments being taken from your account put you in difficulty to pay other essentials.
Encouraged to borrow further?
Lender's offers promoted regular use and the ability to get better deals the more you borrow.
Despite clearly not being able to pay the first loan back, your lender continued to offer more through consolidation.
If any of the above statements apply to your experience, you could be eligible to complain and claim compensation. Millions of pounds have already been refunded to people just like you. Start your claim and get in touch with the experienced team who will guide you through the process.