Not upheld: Irresponsible lending complaint against Evolution Lending Limited trading as Evolution Lending

Decision detail

Summary

Mr C complained that Evolution Lending mis-sold a second charge loan for £25,648 at 23.73% interest over 20 years, arguing he was rushed through the process, not given adequate information, and that the loan was unsustainable given his shared ownership property and reliance on refinancing. The ombudsman found that Evolution Lending's lending decision was fair and reasonable based on Mr C's income (averaging £4,251.86 monthly including commission), recorded expenditure of £3,565.57, and good credit history, leaving sufficient disposable income even after stress testing. Although Mr C had increased unsecured debt by over £20,000, the consolidation loan reduced his overall outgoings. The ombudsman rejected concerns about loan-to-value, sustainability, and property issues as matters for the separate complaint about the broker's advice, and found the loan was properly administered with clear information provided.

The Ombudsman's reasoning

Evolution Lending was required to assess affordability by considering net income, committed expenditure, and essential living costs. The ombudsman found Evolution Lending had reasonable grounds to include overtime and commission in Mr C's income based on evidence covering a full year. The recorded expenditure was reasonable based on information provided, and after stress testing for interest rate rises, Mr C would retain approximately £158 monthly disposable income. Although Mr C had increased unsecured debt significantly, his payment history was good and the consolidation loan reduced his overall outgoings. The ombudsman rejected arguments about loan-to-value and sustainability concerns, noting it was Evolution Lending's decision what loan-to-value to accept. The loan documentation clearly set out all required information.

How this compares

Source

Read the original decision on the Financial Ombudsman Service website