Not upheld: irresponsible lending / unfair credit relationship under s140A Consumer Credit Act 1974 complaint against Moneybarn No.1 Limited (trading as Moneybarn)

Decision detail

Summary

Mr C complained that Moneybarn unfairly entered into a conditional sale agreement for £4,300.00 in February 2016, claiming the £180.57 monthly payments were unaffordable and caused ongoing financial difficulty. Moneybarn had verified Mr C's income via payslips and conducted credit searches showing previous defaults but no CCJs. The ombudsman found that while Moneybarn's checks were not fully proportionate, the complaint could not be upheld because Mr C provided no clear evidence that actual living expenses exceeded Moneybarn's estimates, and his payment history (all on time, early settlement) contradicted his affordability claims. The complaint was rejected as not upheld.

The Ombudsman's reasoning

While the ombudsman agreed that Moneybarn's checks were not fully proportionate given Mr C's adverse credit history and the agreement's cost, the complaint could not be upheld because Mr C failed to provide clear evidence that his actual living expenses were significantly higher than Moneybarn's estimates. The ombudsman noted that Mr C made all payments on time and settled early, which contradicted his claim that payments were unaffordable. Additionally, Mr C's witness statement did not mention affordability concerns despite referring to his circumstances at the time of application, suggesting he did not genuinely believe payments were unaffordable when he chose the car.

How this compares

Source

Read the original decision on the Financial Ombudsman Service website