Not upheld: Mortgage administration / arrears handling complaint against Zenauto Limited

Decision detail

Summary

Mr M complained that Zenauto Limited wrongfully terminated his car hire agreement and repossessed his vehicle. Mr M had fallen into arrears and received a default notice on 6 March 2025 stating he owed £1,407 in arrears and must pay by 24 March 2025 or contact Zenauto to arrange a payment plan. Mr M paid the £1,407 but did not bring his account fully up to date as January and February payments remained outstanding. Zenauto terminated the agreement on 11 April 2025 and repossessed the car, subsequently claiming £5,376.57 in outstanding amounts. The ombudsman found that Zenauto's notice was sufficiently clear, Mr M failed to contact the firm despite multiple attempts by Zenauto to reach him, and the firm followed the required process correctly, therefore the complaint was not upheld.

The Ombudsman's reasoning

The ombudsman found that Zenauto's default notice of 6 March 2025 clearly set out the arrears of £1,407, the deadline of 24 March 2025, and the consequences of non-payment including termination and repossession. Although Mr M paid the stated arrears amount, he failed to bring his account fully up to date as January and February payments remained outstanding. The ombudsman noted that Mr M did not contact Zenauto despite the notice requesting contact, and Zenauto made multiple attempts to reach him. The ombudsman acknowledged Mr M's misunderstanding but concluded that Zenauto followed the required process correctly and did not act wrongly. However, the ombudsman reminded Zenauto of its Consumer Duty responsibility to treat customers fairly in assisting with arrears.

How this compares

Source

Read the original decision on the Financial Ombudsman Service website