Upheld: irresponsible lending complaint against Loans 2 Go Limited
Financial Ombudsman decision DRN-6281716 of 2026-04-17T00:00:00+00:00. irresponsible lending complaint against Loans 2 Go Limited. Outcome: Upheld.
Decision detail
| Reference | DRN-6281716 |
|---|---|
| Decision date | 2026-04-17T00:00:00+00:00 |
| Firm | Loans 2 Go Limited |
| Product | loan |
| Claim type | irresponsible lending |
| Outcome | Upheld |
| Remedy | L2G directed to: (1) Calculate total repayments made by Mr R and deduct from total amount received; (2) If overpayment exists, refund overpayments plus Bank of England base rate plus 1% simple interest per year from date of overpayment; (3) Remove all adverse information from Mr R's credit file if overpaid; (4) If capital balance remains, arrange affordable payment plan and remove adverse information upon clearance; (5) Either buy back the debt from the third party purchaser or liaise with them to ensure redress is carried out promptly. |
Summary
Mr R complained that Loans 2 Go Limited lent irresponsibly when approving two loans in February and April 2025. Loan 1 was for £500 at 678.9% APR, and loan 2 was for £1,990 at 320% APR. At the time of each application, Mr R had existing unsecured debt repayments of £1,123 and £1,025 per month respectively, and had opened eight new credit accounts totalling over £20,000 in the preceding year. The ombudsman upheld the complaint, finding that Mr R's borrowing pattern showed he was using credit unsustainably to make ends meet, and that the affordability assessments were inadequate. For loan 2, the ombudsman noted L2G incorrectly reduced the rent figure from £550 to £350, which would have left Mr R with only £51 monthly disposable income. L2G was directed to refund all interest, fees and charges, remove adverse credit file information, and arrange an affordable payment plan if any capital balance remained.
The Ombudsman's reasoning
The ombudsman found that Mr R's credit file demonstrated a pattern of unsustainable borrowing. With existing unsecured debt repayments consuming 45% of his income at loan 1 and the opening of eight new credit accounts in the preceding year, Mr R showed signs of using credit to make ends meet rather than being in a financially stable position. For loan 1, the addition of £97.78 monthly payments to existing commitments of £1,123 was unsustainable. For loan 2, using the correct rent figure of £550 (not £350) would have left Mr R with only approximately £51 monthly disposable income after all commitments, which was insufficient to sustainably afford the loan and cover unexpected expenses. The pattern of short-term borrowing and rapid repayment (as with loan 1) indicated reliance on credit rather than financial control.
How this compares
| Group | Decisions | Uphold rate |
|---|---|---|
| Loans 2 Go Limited, all decisions | 776 | 58% |
Source
Read the original decision on the Financial Ombudsman Service website