Not upheld: irresponsible lending complaint against Carfinance247 Limited, trading as 247 Money

Decision detail

Summary

Mr R complained that 247 Money lent irresponsibly when providing him with an £8,811 loan in February 2023 with monthly repayments of around £281, arguing that insufficient checks would have revealed the repayments were unaffordable. 247 Money and the investigator did not uphold the complaint. The ombudsman found that 247 Money performed a reasonable and proportionate affordability assessment by verifying Mr R's income of £1,567 per month, calculating his expenditure using ONS data, and obtaining his agreement to these figures during a call. Although Mr R had a prior payday loan default from 12 months earlier, all other factors were positive, and the net increase in monthly expenditure of around £60 appeared affordable. The ombudsman did not uphold the complaint, finding that 247 Money did not lend irresponsibly.

The Ombudsman's reasoning

The ombudsman found that 247 Money performed a reasonable and proportionate affordability assessment appropriate to the circumstances. The firm verified Mr R's declared income, reasonably calculated his committed expenditure using ONS data, and obtained his agreement to these figures during a call. The net increase in monthly expenditure of around £60 (from settling the existing car loan and taking on the new loan) appeared affordable based on all available information. The prior default was outweighed by positive factors including well-managed current accounts and no over-indebtedness. The ombudsman was not persuaded that further checks, such as reviewing bank statements, were necessary given what the credit checks and affordability assessment revealed.

How this compares

Source

Read the original decision on the Financial Ombudsman Service website