Not upheld: irresponsible lending / unaffordable loan complaint against Mitsubishi HC Capital UK PLC trading as Novuna Personal Finance

Decision detail

Summary

Mr C complained that Novuna irresponsibly lent him £7,500 in February 2025 for debt consolidation, arguing the loan was unaffordable. Novuna verified his income at approximately £5,500 monthly, reviewed his clean credit file, and calculated he would have approximately £4,000 in monthly disposable income after accounting for mortgage, existing debts, and other committed spending. The ombudsman found Novuna's affordability checks were proportionate and reasonable, with no indicators of financial difficulty or unsustainability, and therefore did not uphold the complaint.

The Ombudsman's reasoning

The ombudsman applied the FOS approach to irresponsible lending and concluded that Novuna's checks were proportionate for an early-stage lending relationship. The verified income of £5,500 monthly, calculated disposable income of just under £4,000, absence of adverse credit markings, and the debt consolidation purpose all indicated the loan was affordable. The ombudsman found no signs of actual or potential financial difficulties that would have required further enquiries, and concluded that even with more thorough checks, the outcome would likely have been the same.

How this compares

Source

Read the original decision on the Financial Ombudsman Service website