Good to know: You do not need to use a claims management company to make your complaint to your lender. If your complaint is not successful you can refer it to the Financial Ombudsman Service yourself for free.

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A Problem on the Doorstep

Doorstep or home credit is where you borrow money and the lender calls at your home to collect the repayments. It is an expensive form of borrowing and we’ve seen many customers get locked into a borrowing relationship of persistent reliance on these loans.

The Financial Conduct Authority has expressed its own concerns about this form of lending:

“We are concerned that there is a small core of customers who are using home-collected credit over an extended period and that some customers are being unduly influenced by firms’ representatives to keep borrowing.”

Lenders are required to carry out proportionate affordability checks before lending. In practice, this means that the longer the lending relationship goes on for, the more thorough the lender’s checks should be – to ensure that it is sustainable for the customer to keep on borrowing. But often these checks were not ‘borrower focused’ enough, and the customer was allowed to continue to take out expensive home credit loans.

In his ruling on a case concerning 12 doorstep loans, an Ombudsman was especially critical of the lender: “its actions mean that Mr B was paying Morses Club high amounts of interest for the privilege of it allowing him to delay dealing with his unsustainable debt. I don’t think that offering further expensive loans to repay previous ones was exercising forbearance”

If your claim is successful, you will get back all the interest you paid on your irresponsibly given loans.

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Claiming for Free Yourself

Good to know: You do not need to use a claims management company to make your complaint to your lender. If your complaint is not successful you can refer it to the Financial Ombudsman Service yourself for free.