Not upheld: irresponsible lending - inadequate affordability and credit checks complaint against Stellantis Financial Services UK Limited (formerly Vauxhall Finance)

Decision detail

Summary

Miss C complained that Stellantis lent irresponsibly when providing a conditional sale agreement for £34,608.28 in September 2021, arguing she was in a vulnerable financial position with overdrafts, maxed credit cards, and multiple loans. Stellantis claimed to have conducted affordability and credit checks but could not provide evidence of these checks. The ombudsman found that while Stellantis's failure to evidence its checks was problematic, an analysis of Miss C's bank statements and credit file suggested that proportionate checks would have shown the agreement was affordable, with approximately £815 remaining monthly after all identified commitments. The complaint was not upheld.

The Ombudsman's reasoning

The ombudsman acknowledged that Stellantis failed to provide evidence of its claimed checks, making it impossible to verify whether proportionate checks took place. However, the ombudsman proceeded to assess what proportionate checks would likely have revealed. Using Miss C's bank statements and credit file, the ombudsman calculated that after all identified commitments (mortgage, utilities, existing debts, and the new Stellantis repayment), Miss C would have approximately £815 remaining monthly for other household and living costs. The ombudsman concluded this amount did not suggest the loan was unaffordable. The two missed payments on Miss C's credit card had been resolved and her overall credit management at the time did not raise concerns. Therefore, even had proportionate checks been conducted, they would not have identified the agreement as unaffordable.

How this compares

Source

Read the original decision on the Financial Ombudsman Service website