3/4 of 4 responses now in. acknowledged i had other accounts open but no judgements. there were defaults at the time:
You believe Uncle Buck did not perform the correct affordability checks prior to approving your loan applications.
Our Investigation and outcomes
You made your first application on xx January 2016, for an amount of £100.00, to be repaid over three monthly instalments of £52.93. Your application went through a credit check performed by the credit reference agency Call Credit, which confirmed the monthly income you provided of £1 290.00, was accurate. You were also subject to a work verification check, to ensure you were employed as stated on your application. The results confirmed you’d provided accurate employment information.
As part of the application process, we asked you to provide details of your monthly income and expenditure, in order to assess your affordability. Alongside your monthly salary of £1 290.00, you provided monthly expenditure which amounted to £300.00, this left you with a disposable monthly income of £890.00.
Having met our lending criteria, your application was approved. We received payment in full on 29 February 2016.
You made your next application on 29 February 2016, for an amount of £350.00, to be repaid over three monthly instalments of £177.67. You reapplied using the existing customer section of our website, confirming your monthly income remained unchanged from your previous application. You provided monthly expenditure which amounted to £500.00, including £100.00 towards other credit commitments. This left you with a disposable monthly income of £890.00. We also confirmed your application with you telephonically, during which you confirmed you were not considering, seeking or involved with any debt management, and the loan was not to repay other debts. Having met our lending criteria, your application was approved.
On xx March 2016, you contacted us and requested an early settlement figure. We advised you it would cost £431.20 to settle your loan which you accepted and paid, and your account was noted as repaid and closed.
You made your final application on xx May 2016, for an amount of £800.00, to be repaid over three monthly instalments. You reapplied using the existing customer section of our website, confirming your monthly income of £1 419.00. You provided monthly expenditure which amounted to £440.00, this left you with a disposable monthly income of £979.00. Having assessed your affordability, we offered you a reduced amount of £700.00 to be repaid over three monthly instalments of £342.92, which you accepted.Having met our lending criteria, your application was approved.
On 12 May 2016, you contacted us to advise your scheduled repayments would not be affordable as your working hours had been reduced. We asked you to provide your updated income and expenditure information and confirmation of your reduced working hours, in order to agree a repayment arrangement.
On 6 May 2016, you contacted us to advise the income information you provided to us at the point of application was incorrect as you included possible overtime. Having reviewed your updated income and expenditure information, we agreed a repayment arrangement with you.
We received your complaint on 16 April 2018. Your account was placed on hold while we investigate.
I have decided the outcome of your complaint based on the evidence I have to hand. I am sorry to tell you that I do not uphold your complaint.
When assessing your loan applications, we conducted a credit check to assess your creditworthiness. As a high risk lender, even if your credit file contained certain adverse information, we would have still considered your applications. In addition to a credit check, we base our decision to lend using data held within our internal risk scorecard.
During our assessment of whether you were able to afford the repayments, we took into account the monthly income and expenditure you supplied on your applications. You indicated on your applications that you had enough disposable income to pay the loans back. The figures you provided did not highlight that you were experiencing financial difficulty at the time.
Uncle Buck believes that in addition to our responsible lending policy, customers ought to employ an element of responsible borrowing. To assess any loan application, we rely in part on the information provided by customers in respect of their income and expenditure.
As there is no independent way to check a customer’s expenditure, we expect customers to provide us with true and accurate information in this regard. I do not find it unreasonable that we relied on figures you provided as part of our lending decisions.
In addition to the above, I remind you that upon confirming your monthly income and expenditure within the loan application, you specifically agreed to the following disclaimer: “I agree that the financial information provided is accurate and I have considered potential and future income and outgoings in determining my ability to repay the loan requested”.
We understand our responsibility as a lender is to ensure each loan we approve is affordable and I am of the opinion that the checks performed in respect of your applications were both adequate and appropriate. We only approved your loans once we had checked and were satisfied you could afford to repay them.
I have reviewed the credit searches which we obtained at the point of application, they show you did not have any active judgements. In addition, they show you only opened a maximum of six accounts in the previous six months, which would suggest you were not reliant on short term lending. There was nothing within your credit file which would have given us reason to decline your application.
Whilst you have taken out a number of loans with us, I do not consider our three month instalment product allows for consecutive borrowing. It is specifically designed to ensure consumers do not enter a cycle of borrowing. We do not allow a customer to make a new application after the first or the second instalment is repaid but rather when all three repayments have been paid, therefore you could only make a new application at the very least every three months. The point of this is for each loan you were able to repay the first two instalments without borrowing again, which - in my opinion – evidences the loans were affordable for you and breaks any potential borrowing cycle.
I feel it is important to highlight that your ability to repay the loan was impacted by a change in circumstances, your reduction of income, rather than the loan itself being unaffordable. I am satisfied that we acted sympathetically when you advised us that you were experiencing financial difficulty by agreeing a repayment arrangement.
In summary, I am satisfied we assessed your affordability at application correctly and it was your subsequent financial difficulty which hindered your adherence to the original loan agreement.
I note that you have a balance outstanding which you were repaying through a repayment arrangement. I will continue to hold your account until the close of business on 25 June 2018 to allow you to contact the Collections Department on 01959 583 979 to reschedule your repayment dates. Please be advised that if we do not hear from you within the above timeframe the hold will expire, and recovery action will resume.
If you are currently experiencing financial difficulty I have included a list of organisations who may be able to assist you:
The Money Advice Service
Telephone: 0300 500 5000