Martin Lewis explains how borrowers can reclaim thousands for mis-sold loans

Martin Lewis, Money Saving Expert, provides the latest up-to-date information to help people with their money related queries. Now, he has turned his focus towards guarantor loans, which have proved an issue for a wide number of people right across the country. Guarantor loans are arrangements Britons can enter, with their family or friend standing as a guarantee the person will meet their repayments.

If for any reason, the repayment is not met, then it is the responsibility of the guarantor to make the repayment. 

However, many of these loans involve high interest charges, and with arrangements often lasting several years, this can prove an issue.

As a result, many are often required to pay back over three times what they initially borrowed from the lender.

Martin has highlighted many of these loans have been mis-sold, and therefore people could be entitled to get money back.

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“While you won’t know what they did behind the scenes, as long as your circumstances haven’t changed since being approved, if one of you can’t afford it, you were likely mis-sold.

“You may also be due money back if you were treated unfairly – for example, using debt collectors before offering fair repayments or pressured to become a guarantor.”

The amount people can ultimately expect to receive in a rebate if it has been found they have been mis-sold will vary.

However, Martin has stated borrowers can expect to receive interest and fees back, with eight percent interest on top. 

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There are several companies who currently offer guarantor loans to Britons.

Amigo Loans is perhaps the most well-known, however, Martin has highlighted other organisations including Buddy Loans, TrustTwo and TFS Loans. 

Martin also drew attention to a Briton named Sam who managed to receive a £14,000 reclaim.

While the company did not legally accept this as a case of mis-selling, as a gesture of good will it made a refund. 

The Financial Ombudsman has said it will only look at complaints customers have had a chance to look at first.

When providing Britons with repayment if their loan has been mis-sold the Ombudsman also requires guarantors to take action to help a customer.

Its website explained: “We’re likely to tell a lender to make sure their customer’s credit file doesn’t have any adverse information recorded about the loans where we’ve identified proportionate checks would have shown tat the borrower couldn’t sustainably repay the loan.

“If we decide that there came a point where the lender should have realised that any further lending was clearly unsustainable, we’re likely to tell the lender to get these removed from their customer’s credit file completely.”

A borrower could gain extra compensation if it is found they were caused distress and inconvenience. 



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