Not upheld: irresponsible lending complaint against Creation Consumer Finance Limited

Decision detail

Summary

Miss A complained that Creation Consumer Finance Limited lent to her irresponsibly when she borrowed £5,000 in June 2024. She later disclosed that at the time of application she was spending heavily on gambling and relying on her overdraft, information she had not provided to Creation. The ombudsman found that Creation's affordability assessment, which included income verification, industry-standard living cost estimation, and credit file checking, was proportionate to the circumstances. The ombudsman concluded that the information available to Creation reasonably supported the lending decision and that there were no indications requiring deeper investigation into Miss A's finances. The complaint was not upheld.

The Ombudsman's reasoning

The ombudsman applied the regulatory requirement for reasonable and proportionate affordability assessments, considering factors such as income level, repayment amount, and loan duration. The ombudsman concluded that Creation's checks were proportionate given the circumstances and that the information gathered suggested Miss A could afford sustainable repayments with a reasonable buffer for emergencies. The ombudsman rejected the argument that bank statement analysis should have been conducted, finding no indications that deeper investigation was warranted and noting that Miss A's gambling spending and overdraft reliance were not disclosed and would not have been discovered through proportionate checks.

How this compares

Source

Read the original decision on the Financial Ombudsman Service website