Not upheld: irresponsible lending complaint against Admiral Financial Services Limited

Decision detail

Summary

Mr V complained that Admiral lent irresponsibly when approving his £15,000 debt consolidation loan application in August 2022. Admiral verified Mr V's income of £2,540 net monthly and completed an affordability assessment showing he would have £259-£719 remaining monthly depending on whether he consolidated his credit card debts. Although Mr V had substantial unsecured debt of £30,225, the credit file showed no adverse history or missed payments. The ombudsman found Admiral's checks were proportionate and the loan repayments appeared sustainable, and therefore did not uphold the complaint of irresponsible lending.

The Ombudsman's reasoning

The ombudsman applied the regulatory requirement that lenders must complete reasonable and proportionate checks before lending. The ombudsman found Admiral's checks were proportionate given the loan amount, term, and Mr V's circumstances. Although Mr V had substantial existing unsecured debt, the affordability assessment showed sustainable repayments in both scenarios (with and without consolidation). The verified income, absence of adverse credit history, and clear consolidation purpose supported the lending decision. The ombudsman rejected Mr V's appeal despite other upheld complaints, finding no irresponsible lending in this specific case.

How this compares

Source

Read the original decision on the Financial Ombudsman Service website