In March 2015, ‘Caroline’ entered into a credit agreement with Shop Direct Finance Company (SDFC) through Littlewoods, with an initial credit limit of £150. She intended to use this to purchase items such as clothing and other personal goods.
At the time of taking out the agreement, Caroline already had a County Court Judgement against her for other outstanding debts. This should have been flagged during any credit checks to ensure she could afford the repayments. However, Caroline claims she does not recall SDFC conducting any credit check, nor was her financial situation discussed with her.
Over the course of her credit agreement, Caroline noticed that her credit kept increasing and decreasing but didn’t recall being informed of any changes. At one point, her credit limit increased from £675 to a staggering £1,675, a far cry from her original limit of £150. In time, the constant fluctuations led to Caroline exceeding her credit limit, which led to increased repayments due to interest added on missed payments.
During the term of her credit agreement, Caroline’s financial circumstances deteriorated, making it difficult for her to keep up with payments. She often had to rely on family and friends for support in making the instalments. The situation also made it challenging for her to pay other bills, particularly as the repayments ate into her disability payments. As a result, Caroline experienced feelings of depression and anxiety, constantly worrying about her financial stability.
Barings Law submitted an Irresponsible Lending claim to SDFC who responded by confirming they would uphold the complaint. As a result, Barings Law secured a settlement of £1,147.01 on Caroline’s behalf and her credit file was wiped clean of any negative marks caused by the agreement.
*Amount awarded to Caroline is before legal fees and disbursements.
