Not upheld: irresponsible lending - affordability assessment complaint against Nationwide Building Society

Decision detail

Summary

Miss B complained that Nationwide irresponsibly provided four loans between January 2022 and October 2024 due to inadequate affordability assessments. An investigator found loans 3 and 4 were unaffordable, but a subsequent ombudsman review concluded all lending was fair after considering Miss B's significant savings account. The final ombudsman decision upheld this conclusion, finding that while checks for loans 3 and 4 could have been more proportionate, bank statement analysis and Miss B's substantial savings demonstrated she had sufficient disposable income and financial resilience to repay the loans. The complaint was not upheld.

The Ombudsman's reasoning

The ombudsman assessed whether Nationwide completed reasonable and proportionate checks and made fair lending decisions. For Loan 3, although checks were not fully proportionate, bank statement analysis showed Miss B had approximately £400 disposable income after all commitments, making the lending affordable. For Loan 4, despite decreased income and increased debt, Miss B's significant savings (exceeding the loan amount) provided financial resilience and demonstrated she had sufficient disposable income to service the debt. The ombudsman concluded that Nationwide could reasonably rely on the savings as evidence of repayment capacity and that the lending did not cause foreseeable harm.

How this compares

Source

Read the original decision on the Financial Ombudsman Service website