Upheld: irresponsible lending - failure to conduct adequate affordability checks complaint against N.I.I.B. Group Limited, trading as Northridge Finance
Financial Ombudsman decision DRN-6242692 of 2026-04-16T00:00:00+00:00. irresponsible lending - failure to conduct adequate affordability checks complaint against N.I.I.B. Group Limited, trading as Northridge Finance. Outcome: Upheld.
Decision detail
| Reference | DRN-6242692 |
|---|---|
| Decision date | 2026-04-16T00:00:00+00:00 |
| Firm | N.I.I.B. Group Limited, trading as Northridge Finance |
| Product | hire purchase agreement |
| Claim type | irresponsible lending - failure to conduct adequate affordability checks |
| Outcome | Upheld |
| Remedy | Northridge Finance must calculate total payments made by Mr J under the hire purchase agreement. If payments exceed £1,510.59 (fair usage charge for three months), refund the difference with 8% simple annual interest. If payments are less than £1,510.59, arrange an affordable repayment plan for the outstanding amount. In either case, remove all adverse information about the hire purchase agreement from Mr J's credit file. Northridge Finance must deduct tax from any interest paid as required by HM Revenue & Customs and provide a tax certificate if requested. |
Summary
Mr J complained that Northridge Finance irresponsibly provided him with a hire purchase agreement for a car priced at £29,120 with monthly payments of £503.34. The ombudsman found that Northridge Finance failed to conduct reasonable and proportionate affordability checks before entering into the agreement. Analysis of Mr J's bank statements revealed his average monthly disposable income was only £467, making the monthly payment unaffordable. The ombudsman upheld the complaint and ordered Northridge Finance to refund any payments exceeding a fair usage charge of £1,510.59 (for three months' use), remove adverse credit file information, and arrange an affordable repayment plan if Mr J had underpaid.
The Ombudsman's reasoning
Northridge Finance failed to conduct reasonable and proportionate affordability checks as required by consumer credit regulations. The ombudsman determined that if proper checks had been carried out using Mr J's verified income and expenditure information, they would have shown the hire purchase agreement was not sustainably affordable. With monthly disposable income of £467 against a required monthly payment of £503.34, the credit should not have been provided. As the credit should not have been advanced, Mr J should only pay for fair usage of the car (three months at the monthly payment rate) rather than the full interest-bearing agreement.
How this compares
| Group | Decisions | Uphold rate |
|---|---|---|
| N.I.I.B. Group Limited, trading as Northridge Finance, all decisions | 11 | 46% |
Source
Read the original decision on the Financial Ombudsman Service website