irresponsible lending

[qwedr]

i have read of a couple of cases of irresponsible lending by the banks where they have agreed to write of the debts.

in my case i have taken out a series of loans totalling over £100,000. i am self employed and stated that i was earning £65,000 per year. the banks asked for proof of income. i said i was self employed and filled in my own accounts. they then asked me to send them a copy of my accounts. i said i didnt have any. they then asked for a letter with a proof of my self employed status. i faxed over a copy of a letter from the inland revenue with a refernce on it for a self employed person. this was in actual fact a letter saying that owed£100 as a result of filing my tax return late.



i must also stress that i have taken out these loans in the last few months.

i am not sure how much more detail to go into. i can obviously expand further.

i would basically like to know if there is case against the banks in this situation for irresponsible lending

[natweststaffmember]

Re: irresponsible lending

Are we talking about the fact you are unable to pay those commitments? Or are you looking for a way to avoid paying them?(sorry to be blunt btw)

[qwedr]

Re: irresponsible lending

i am unable to pay them
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but even if that werent the case, surely there must be some sort of case against the banks the banks as they made no effort to check the stated income

[scoobydoo]

Re: irresponsible lending

When you took the loans out what would your credit check have said about you ?

In other words were you a good risk at the time.

I would point out that this site would never advocate not paying back debts that you actually owe .
Are you actually saying at the time you thought you could afford them and your circumstances have changed - or you knew at the time you would not be able to make repayments?


There has been at least one case where a financial institution was fined for not making the correct checks - but that would not assist you.

A few more details would be useful - what were the loans for etc.

[Amy]

Re: irresponsible lending

i am unable to pay them
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but even if that werent the case, surely there must be some sort of case against the banks the banks as they made no effort to check the stated income

You said you only took these loans out a short time ago, what has changed that you are now unable to repay them?

[Paule]

Re: irresponsible lending

stated that i was earning £65,000 per year.

Were you earning that £65K?

[qwedr]

Re: irresponsible lending

i stated i took the loans out for home improvements, but it was never used for this.

no i wasnt earning the money at the time which i realise puts me in a tricky position.

not really sure what my credit file said.

my point is more that there should surely be some onus on the banks to make checks about what people have said they are earning.

[Paule]

Re: irresponsible lending

i stated i took the loans out for home improvements, but it was never used for this.

What were they used for?

no i wasnt earning the money at the time which i realise puts me in a tricky position.

Correct, it may also have criminal ramifications, ie fraud, decpetion etc

not really sure what my credit file said.

my point is more that there should surely be some onus on the banks to make checks about what people have said they are earning.

You stated that they asked you for various eveidence, ie proof of income, accounts, which you dint have

This is my personal opinion based on what you have posted so far, and that is that you are in the wrong here, rather than the banks.
And if you push the case, all this will come out in the wash and expose anything you may have been hiding, because they lent on information supplied by YOU.

Others may disagree and have an alternate view on the matter though

PKea

[qwedr]

Re: irresponsible lending

i wouldnt disagree with what you have said, especially the potential problems i may face with regard to fraud/deception. the money more or less got used up in the course of my business.

the banks did ask for accounts. when i said i didnt have any to show them. they said they would be happy with a letter from the inland revenue with a reference number on it showing i was self employed. this by no means had any reference to waht my income was. i am not sure if they could access my account with this refernce number but if they had done it would certainly have shown that i wasnt earning that money and havent been for a considerable time.

i am just trying to figure out my options.

any more opinions would be more than welcome

[qwedr]

Re: irresponsible lending

part of the reason i am asking is the article below





Banks write off £100,000 after irresponsible lending claims




A "vulnerable" man earning £150 a week managed to rack up debts of more than £100,000 across nine personal loans in what his brother claims is the latest example of irresponsible bank lending.

The 50-year-old warehouseman has a poor understanding of financial matters and had no hope of ever repaying the loans, according to his older brother, Colin Griffiths.
Following Colin's intervention, and the involvement of Guardian Money, all five lenders have now decided to write off the loans. One of them, Sainsbury's Bank, says the loan application should not have been approved and steps have been taken to ensure this does not happen again. But others, such as Barclays Bank, say they lent the money based on inaccurate information provided by Douglas Griffiths about his income and outgoings.
The case coincides with a new study highlighting serious failures in banks' lending practices. uSwitch.com, the online and phone-based comparison service that helps customers find a better deal, claims almost nine out of 10 credit card borrowers were issued cards without the lender checking that they could afford to repay the debt.
Late last summer, Colin discovered that Douglas, who lives in north London, had taken out a string of unsecured loans that he could not afford to repay. In all, he had borrowed around £70,000 between July 2002 and May 2005, saying that he needed the money for home improvements. This total is made At least two loans - £7,000 and £15,000 - from Barclaycard. It appears the £15,000 loan was taken out to repay the £7,000 one, plus provide extra cash. Monthly repayment: £407.56.

· Two loans - £25,000 and £500 - from Barclays Bank. Monthly repayment (on the £25,000 loan): £481.48.
· Two loans - £7,000 and £12,000 - from Halifax. It appears the £12,000 loan was taken out to repay the £7,000 one, plus provide extra cash. Monthly repayment: £221.66.
· £7,500 from Sainsbury's Bank. Monthly repayment: £191.81.
· £5,000 from Liverpool Victoria. Monthly repayment: £117.97.
· £5,000 from Tesco Personal Finance. Monthly repayment: £74.92.
With many of the lenders selling him payment protection insurance too, the total debt soared well over £100,000.
However, as many of the lenders pointed out, Douglas did not help his case by telling them he earned £400 a week. In fact, his take-home pay was £125 a week at the time and is now £150-£160.
Colin acknowledges his brother is at fault but says he is the victim of irresponsible lending because he was a vulnerable man who did not understand the implications. Furthermore, he says the lenders failed to verify his brother's affairs to properly assess whether he was able to meet the repayments.
Colin is particularly critical of Barclays because Douglas has his current account with the bank, and therefore it would have been easy to see he could not afford more than £800 a month in loan repayments to the Barclays group.

[Paule]

Re: irresponsible lending

i must also stress that i have taken out these loans in the last few months.

How many payment s have you made?

i am not sure how much more detail to go into. i can obviously expand further.
The more ionfo and background you can give, will help people give an informed answer to your question

How much did you actually earn at the time in relation to the amount you claimed you earnt.
It can be a rough figure, just to get a comparsion to the story you have quoted

[scoobydoo]

Re: irresponsible lending

Also is this a major high street bank?

Were the loans secured on a property ?

[qwedr]

Re: irresponsible lending

they are unsecured loans and i have made about three payments on each one. they are with high street banks

[Amy]

Re: irresponsible lending

Are you a "vulnerable man" who has "a poor understanding of financial matters"?

[qwedr]

Re: irresponsible lending

technically i wasnt earning anything at the time i took out the loans
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Are you a "vulnerable man" who has "a poor understanding of financial matters"?

probably wouldnt describe myself that way