‘Elizabeth’ entered into a five-year motor finance agreement for a Vauxhall GTC Coupe valued at £12,495 in June 2018.
The interest rate was set at 31.3%, resulting in a total payable amount of £22,093.68.
At the time of taking out the agreement, Elizabeth already had a County Court Judgement for a catalogue debt and was repaying outstanding loan and credit card repayments. This should have been flagged up at the time of any credit checks taking place to ensure she could afford the payments.
However, Elizabeth says she cannot recall a credit check taking place but does remember that she felt pressured to purchase the vehicle, despite no communication from the dealer about her financial situation.
When inspecting the vehicle, Elizabeth noted some damage to the alloys and was told they would be repaired prior to her collection. This was not the case, though, and they were simply sprayed to disguise the damage. During her five-year term, the car was stolen, resulting in the finance provider increasing her repayments.
Things took another turn for the worse when the pandemic hit as Elizabeth lost her business. With such a drastic change to her financial circumstances she ended up applying for a benefit scheme.
Elizabeth contacted her finance provider to try to arrange reduced payments over a longer period or take a payment holiday. Her requests were denied. She struggled to make her payments and had to borrow money from friends and family to stay afloat. The stress and anxiety caused by the debt had a significant impact on her mental health.
Barings Law submitted an affordability complaint on Elizabeth’s behalf and her finance provider responded, saying: “We have not been able to satisfy ourselves the lending that took place was suitable for you. We offer our sincere apologies for this.”
As a result, Barings Law secured a settlement of £10,411.19*, with Elizabeth having no further liability to her provider. In addition, her credit file was wiped clean of any ‘black marks’ caused by the finance deal.
*Amount awarded to Elizabeth is before legal fees and disbursements.
