Upheld: irresponsible lending / inadequate affordability checks complaint against Auto Accept Finance Limited (trading as AAF)
Financial Ombudsman decision DRN-6242477 of 2026-05-08T00:00:00+00:00. irresponsible lending / inadequate affordability checks complaint against Auto Accept Finance Limited (trading as AAF). Outcome: Upheld.
Decision detail
| Reference | DRN-6242477 |
|---|---|
| Decision date | 2026-05-08T00:00:00+00:00 |
| Firm | Auto Accept Finance Limited (trading as AAF) |
| Product | hire purchase agreement |
| Claim type | irresponsible lending / inadequate affordability checks |
| Outcome | Upheld |
| Remedy | AAF must calculate total payments made by Miss F under the hire purchase agreement. If payments exceed £4,991.80 (fair usage charge for the car), AAF must refund the difference with 8% simple interest per annum on any credit balances. AAF must remove all adverse information about the agreement from Miss F's credit file. If payments are less than £4,991.80, AAF must agree an affordable repayment plan for the outstanding balance and remove adverse credit file information once cleared. AAF must provide a tax certificate if requested. |
Summary
Miss F complained that AAF approved a hire purchase agreement for a car in March 2018 without conducting adequate affordability checks. The agreement required monthly payments of £231.40. AAF had verified Miss F's income at £1,400 and received information about her expenditure but did not obtain detailed spending information. The ombudsman found that Miss F's actual disposable income was approximately £169 per month based on her bank statements, making the monthly payments unsustainably affordable. The ombudsman upheld the complaint and ordered AAF to refund any overpayments Miss F made beyond a fair usage charge of £4,991.80, with interest, and to remove adverse credit file information.
The Ombudsman's reasoning
The ombudsman found that AAF failed to conduct reasonable and proportionate affordability checks. Although AAF had verified Miss F's income at £1,400 and received information about her expenditure, it obtained no detailed breakdown of her spending. Using Miss F's bank statements as evidence of what reasonable checks would have revealed, the ombudsman calculated that Miss F had only £169 disposable income monthly, making the £231.40 monthly payments unsustainably affordable. The fact that Miss F maintained payments for three years and did not raise concerns about affordability does not demonstrate that AAF acted reasonably, as the fair lending decision should have been made at the point of approval based on proper checks. The ombudsman therefore concluded AAF should not have provided the credit.
How this compares
| Group | Decisions | Uphold rate |
|---|---|---|
| Auto Accept Finance Limited (trading as AAF), all decisions | 1 | 100% |
Source
Read the original decision on the Financial Ombudsman Service website