Not upheld: Irresponsible lending complaint against Close Brothers Limited trading as Close Brothers Motor Finance

Decision detail

Summary

Mrs M complained that CBL irresponsibly provided her with an unaffordable conditional hire agreement for a motor vehicle. CBL obtained a credit check and Mrs M's declared income of £2,000 per month but did not validate the income. The ombudsman found that while CBL's checks were not fully proportionate, evidence from payslips and bank statements showed Mrs M's actual income was approximately £1,725-£1,890 per month, which would have supported an affordability conclusion. The ombudsman also found CBL provided appropriate support and forbearance when Mrs M experienced payment difficulties during the term. The complaint was not upheld, and no remedy was ordered.

The Ombudsman's reasoning

While CBL's checks were not fully proportionate because it failed to validate Mrs M's income, the ombudsman found that proportionate checks would have revealed actual income of approximately £1,725-£1,890 per month. Based on CBL's own assessment of non-discretionary expenditure and existing credit commitments (which were proportionate), and corroborated by bank statements, the agreement would have appeared affordable at the actual income level. Therefore, even with proper checks, CBL would have reached the same fair decision to lend. The ombudsman also found CBL provided appropriate support and forbearance when Mrs M experienced difficulties, and there was no evidence of unfair treatment under s.140A of the Consumer Credit Act 1974.

How this compares

Source

Read the original decision on the Financial Ombudsman Service website