Not upheld: irresponsible lending / insufficient affordability and creditworthiness assessment complaint against Stellantis Financial Services UK Limited

Decision detail

Summary

Mr L complained that Stellantis provided a conditional sale agreement for a used car without conducting sufficient affordability and creditworthiness checks, claiming he could not afford the £216.81 monthly payments. The application form stated Mr L earned £20,400 annually and lived at home with parents, though Mr L later claimed his actual income was approximately £750 per month with outgoings exceeding £1,300 and that he was in rented accommodation. The ombudsman found that Stellantis's checks were proportionate, including income verification and a credit search showing no adverse information, and that the stated living arrangement reduced expected priority debt obligations. The ombudsman concluded that even if further checks had been conducted, they would not have revealed the lending was unaffordable given the absence of contradictory information in the credit search and the results of Stellantis's other checks. The complaint was not upheld.

The Ombudsman's reasoning

The ombudsman applied the FOS approach to irresponsible lending, assessing whether Stellantis carried out proportionate checks. The ombudsman found that Stellantis's checks were proportionate given the circumstances: the declared income was cross-checked, the credit search showed no adverse information, and the stated living arrangement (with parents) would reduce expected priority debt obligations. Although Mr L's actual circumstances were more complicated, the ombudsman concluded that even if Stellantis had conducted further checks into monthly outgoings, it would not have discovered the lending was unaffordable given the results of its other checks and the absence of contradictory information in the credit search. The ombudsman also considered the complaint under section 140A of the Consumer Credit Act 1974 but found no evidence of irresponsible lending or unfair treatment.

How this compares

Source

Read the original decision on the Financial Ombudsman Service website