Not upheld: Irresponsible lending complaint against First Response Finance Limited

Decision detail

Summary

Mr M complained that First Response Finance Limited lent irresponsibly when providing him with a £2,748 hire purchase agreement for a motorcycle in June 2025 with monthly repayments of £118.66 over 42 months. Mr M had a history of five defaults (most recent 14 months prior), approximately £7,000 existing debt, and income of approximately £2,872 per month from benefits including disability-related payments. First Response conducted an affordability assessment using verified income, estimated living expenses of £950 for housing plus £221 for existing debt repayments, and concluded Mr M had sufficient disposable income. The ombudsman found the assessment was reasonable and proportionate, rejected arguments that benefit income was unsustainable, and did not uphold the complaint.

The Ombudsman's reasoning

The ombudsman found that First Response conducted a reasonable and proportionate affordability assessment using verified figures where available and reasonably calculated figures where they were not. The assessment showed Mr M would have sufficient disposable income to afford the repayments sustainably. The ombudsman rejected the argument that benefit income should be excluded as unsustainable, finding it was regular and reliable. The 14-month period without reported issues was considered reasonable context for the previous defaults. No unfairness was found under section 140A of the Consumer Credit Act 1974.

How this compares

Source

Read the original decision on the Financial Ombudsman Service website