Not upheld: Irresponsible lending complaint against Hastings Financial Services Limited

Decision detail

Summary

Miss G complained that Hastings lent to her irresponsibly without adequate affordability checks for a £4,000 debt consolidation loan. Miss G had existing credit commitments totalling £1,461.35 monthly (79% of her £2,418 net income) including five loans, £11,496 credit card debt, and a mortgage. Hastings obtained bank statements from one account but did not request joint account statements showing Miss G shared all major bills and mortgage costs with her partner. The ombudsman found that while Hastings should have verified the mortgage cost more carefully, had it done so and reviewed the joint statements, combined with Miss G's bonus, inheritance, and debt consolidation purpose, the loan would have been shown as affordable. The complaint was not upheld.

The Ombudsman's reasoning

The ombudsman found that while Miss G's existing debt was high (79% of net salary), Hastings' checks were reasonable and proportionate for a £4,000 debt consolidation loan with £106 monthly repayments. Although Hastings should have verified the mortgage cost more carefully, had it done so and reviewed the joint account statements, it would have discovered Miss G shared all major bills and mortgage costs with her partner. Combined with the bonus, inheritance, and debt consolidation purpose, this would have demonstrated affordability. Miss G showed no signs of financial difficulty.

How this compares

Source

Read the original decision on the Financial Ombudsman Service website