Not upheld: irresponsible lending / inadequate affordability assessment complaint against Oakbrook Finance Limited

Decision detail

Summary

Mr P complained that Oakbrook Finance Limited lent to him irresponsibly through three loans between December 2022 and May 2024. The ombudsman examined whether Oakbrook conducted adequate affordability assessments before agreeing each loan. The ombudsman found that Oakbrook's checks—including income verification, expenditure estimation using industry data, and credit file review—were proportionate given the loan amounts and terms. The results of these checks fairly demonstrated Mr P could repay sustainably, and the ombudsman noted that loan 2 refinanced loan 1 rather than adding to repayment obligations. Accordingly, the complaint was not upheld and no remedy was awarded.

The Ombudsman's reasoning

The ombudsman applied the regulatory requirement for reasonable and proportionate affordability assessments that are borrower-focused. The assessment must consider whether repayments would cause undue difficulty or adverse consequences. The ombudsman found Oakbrook's checks were proportionate given the loan amounts and terms, including income verification, expenditure estimation using industry data, and credit file review. The results of these checks fairly demonstrated Mr P could repay sustainably. Even the lower verified income for loan 2 supported affordability when accounting for the refinancing nature of that loan.

How this compares

Source

Read the original decision on the Financial Ombudsman Service website