Not upheld: irresponsible lending complaint against Moneybarn No.1 Limited

Decision detail

Summary

Mr M complained that Moneybarn lent irresponsibly when providing a £21,501.92 motor finance loan with 21.5% APR and 59-month term in November 2023. Mr M argued the loan was unaffordable and cited mental health vulnerabilities and fluctuating income. The ombudsman found that while Moneybarn's checks could have been more proportionate, adequate income verification and bank statement analysis would have shown the loan was affordable. Since Mr M did not disclose his mental health issues or income fluctuations to Moneybarn, the ombudsman could not find the firm acted unfairly and did not uphold the complaint.

The Ombudsman's reasoning

The ombudsman found that while Moneybarn's initial checks were not fully proportionate to the loan size, if proportionate checks had been conducted they would likely have shown the loan was fair to provide. The income verification was adequate, and bank statement analysis would have shown Mr M had sufficient funds for repayments. The ombudsman could not hold Moneybarn responsible for Mr M's undisclosed mental health vulnerabilities or fluctuating income, as these were not communicated to the firm.

How this compares

Source

Read the original decision on the Financial Ombudsman Service website