Not upheld: Irresponsible lending complaint against Carnegie Consumer Finance Limited

Decision detail

Summary

Mr A complained that he was mis-sold a £7,700 loan by Carnegie Consumer Finance Limited through a broker, claiming he was told the course would cost £180 per month for three months then reduce to £20 per month, and that he was unaware he was taking out a loan. Carnegie defended the complaint, noting Mr A had signed a clear loan agreement and confirmed the payment terms on a recorded call. The ombudsman found Mr A was aware of the loan terms based on the signed documentation, the recorded confirmation call, and his payment history showing he paid £180 monthly without complaint until 2020. The ombudsman also found Carnegie's affordability checks were proportionate, with Mr A showing £800 monthly surplus against £180 loan payments. The complaint was not upheld.

The Ombudsman's reasoning

The ombudsman found that the documentary evidence clearly showed Mr A was signing up for a loan with specified monthly payments. The recorded call confirmed Mr A acknowledged the £180 monthly payment. Mr A's actions were inconsistent with someone who believed payments would reduce to £20 after three months - he paid £180 for over a year without complaint and only raised this issue in 2021. The ombudsman considered Carnegie's affordability checks proportionate to the circumstances, with Mr A showing £800 monthly surplus after expenses against £180 loan payments. While Mr A's financial situation later deteriorated, this did not mean Carnegie was irresponsible in initially lending to him.

How this compares

Source

Read the original decision on the Financial Ombudsman Service website