Discretionary Commission Arrangements - Complaints and Refunds

You do not need to use a Claims Management Company. You can make the claim directly to the lender and if they reject your complaint you can take it to the Financial Ombudsman Service free of charge, but you must do this within 6 months of the lenders Final Decision Letter.

What affordability checks should a UK car loan lender undertake?


In the UK, car loan lenders are required to conduct affordability checks to ensure that the borrower will be able to make the loan payments. These checks typically include reviewing the borrower's income, debts, and credit history to determine whether they are able to afford the loan.

Here are some specific steps that a car loan lender might take when conducting affordability checks:

  1. Review the borrower's income: The lender will want to see proof of the borrower's income, such as pay stubs or tax returns, to determine their ability to make the loan payments.

  2. Assess the borrower's debts: The lender will consider the borrower's existing debts, including credit card balances, mortgage payments, and other loans, to determine how much additional debt they can reasonably take on.

  3. Check the borrower's credit history: The lender will review the borrower's credit report to assess their creditworthiness and to see if they have a history of making timely loan payments.

  4. Calculate the borrower's debt-to-income ratio: The lender will calculate the borrower's debt-to-income ratio, which is a measure of how much of their income is being used to pay off debts. If the ratio is too high, it may indicate that the borrower will have difficulty making the loan payments.

Overall, the goal of these affordability checks is to ensure that the borrower is able to make the loan payments without undue financial strain.