How do refunds work for loans and credit cards?
A loan is generally considered affordable if you can repay it without needing to borrow further or fall behind on other financial commitments.
For credit cards, affordability may be considered based on the initial credit limit and any subsequent increases. Lenders are expected to assess whether the credit provided is manageable for your circumstances.
If appropriate affordability checks may not have been carried out before credit was provided, you may be able to make a complaint. If a complaint is successful, this may result in a refund of interest and charges.
How we handle your claim
To assess whether a complaint may be appropriate, we will review your circumstances at the time the credit was provided and consider whether the lender followed relevant regulatory guidance.
As part of this process, we may:
Request information about your borrowing from your lender(s)
Review the information provided by your lender alongside the information you share with us
Assess whether the lending may have been unaffordable based on your circumstances
If you choose to proceed, we can submit a complaint to the lender on your behalf and keep you informed throughout the process.
What happens next?
Once a complaint has been submitted, the lender will review the case.
In many cases, lenders aim to respond within eight weeks, although this is not guaranteed.
At the end of their review, they should issue a Final Response outlining their decision.
If the lender does not respond within this timeframe, we will follow up with them and keep you updated.
If you are not satisfied with the outcome, you may be able to refer your complaint to the Financial Ombudsman Service.
What happens after the lender responds?
Once the lender provides their Final Response, we will review it to check whether they have addressed the points raised in the complaint.
If your complaint is successful
If your complaint is upheld and compensation is awarded, our fee of up to 28% of the total compensation will be payable.
If the lender does not uphold your complaint
If the lender does not uphold your complaint, or you are not satisfied with their response, you may be able to refer the matter to the Financial Ombudsman Service (FOS).
With your permission, we can assist in referring your complaint to the Financial Ombudsman Service.
We may also suggest referring your complaint to the FOS if:
The lender has not provided a Final Response within eight weeks, or
You are not satisfied with the outcome
Important information about the process
We do not use the court system to pursue these types of complaints.
If your complaint is not successful, you will not pay us anything. If your complaint is successful, the only fee payable is as outlined above.
Important information during your claim
If you still have an outstanding balance or active account, you should continue making your normal payments while your complaint is being considered. Missing payments may affect your credit file.
If your complaint is successful, any negative information recorded as a result of the lending may be reviewed by the lender and, where appropriate, amended or removed.
Making a complaint will not appear on your credit file.
Can you make a claim?
The amount of any compensation will depend on your individual circumstances, including the amount borrowed and the interest and charges applied to your account.
If the lending may not have been affordable, you may be able to make a complaint. If your complaint is successful, this may result in a refund of some interest and charges.
Our role is to assess your situation and, if you choose to proceed, assist you in pursuing a complaint with your lender.
Situations where you may be able to make a complaint
Your loan or credit card may be worth reviewing if any of the following apply:
Appropriate checks may not have been carried out on your financial circumstances before the credit was approved
You were given one or more loans that may not have been affordable based on your situation
Your credit limit was increased and you found it difficult to manage the repayments
The borrowing formed a significant part of your income and may have affected your ability to meet essential living costs such as rent, bills, or everyday expenses
You needed to borrow further money (for example from other lenders, credit cards, or family) to keep up with repayments
You were offered additional borrowing on a repeated basis, which may have contributed to financial difficulty
There were indications of financial difficulty, and the support offered may not have been appropriate to your circumstances
Each case is assessed individually.