Not upheld: Irresponsible lending complaint against Oodle Financial Services Limited (trading as Oodle Car Finance)

Decision detail

Summary

Mr H complained that Oodle unfairly lent to him for a car on hire-purchase in August 2018 with unaffordable monthly payments of £272.26-£322.26, and that Oodle failed to disclose a £1,107.50 commission paid to his credit broker. Oodle's checks showed Mr H had historic credit difficulties but low active credit and sufficient income after estimated living costs. The ombudsman found that while Oodle used statistical living cost data rather than actual costs, proportionate checks would not have extended to discovering Mr H's gambling activity revealed in later bank statements, and actual costs would have shown affordability. Regarding the undisclosed commission, the ombudsman applied the Supreme Court's Hopcraft test and found the fixed 10% commission was not high, involved no discretionary arrangement, and no commercial tie existed, so it did not render the relationship unfair. The complaint was not upheld.

The Ombudsman's reasoning

While Oodle's use of statistical living cost data was not ideal given Mr H's credit history, the ombudsman concluded that using actual living costs would have shown the payments were affordable at the time. The ombudsman found that proportionate checks would not have extended to discovering Mr H's gambling activity, particularly given the significant cash deposit paid. Regarding commission, the ombudsman applied the Supreme Court's Hopcraft test and found the £1,107.50 fixed commission (not discretionary) was not high relative to the amount borrowed or cost of credit, and no commercial tie existed between the broker and Oodle.

How this compares

Source

Read the original decision on the Financial Ombudsman Service website