Irresponsible lending? Mums credit cards

[Orangefantastic]

Hi,

Ive just discovered that mum is in a bit of a mess! She’s 75, widowed 2 years ago and for the first time is having to manage her finances. ( dad always did it)

in Sep 2023 she applied for a credit card with a well known high street bank. She says that when she applied there was an error message and she assumed that it hadn’t worked. She applied again immediately and was accepted for £4K limit with an introductory 0% period. A week later 2 cards arrived. Same product etc. it appears that both applications went through and she basically ended up with 2 identical cards, each except the same credit limit. There is a one digit difference between her customer numbers. I can only assume that this was a system error and that only one card should have been issued.

fast forward to now and mum has a balance on each card of almost 4K. She’s panicking. The interest free period is about to expire and her payments will rocket to over £200 per month.

now I’m all for personal responsibility, and I do wish that mum has spoken to me earlier, however she’s an elderly vulnerable woman and I think that issuing 2 cards was irresponsible, even if it was in error.

I think that we need to complain. I’m not expecting the debt to be written off- she’s spent the money after all, however I think it’s reasonable to ask them to reduce it remove the interest if the card was issued in error. Do you think this is an example of irresponsible lending?

You need to get it asap. It will take a while to come through. It has to be done while she still has capacity. If she has a fall or a stroke - bam she can’t get into her accounts and neither can you.

The interest charges will mean that she has less to spend on her basic living costs.
is she going to be without the means to pay her basic bills? or just not the standard she is used to?

So she's been getting two statements each month presumably. So she knew about the credit cards but has buried her head in the sand? How does she pay the credit card bills - direct debit minimum payment or what? What has she spent the £8k on? Is she entitled to pension credit as a widow on a reduced income but hasn't applied? I used to handle complaints in a bank. In my experience, even if your mother was accepted as being lent to irresponsibly (and that relies on the facts, they'll check what she said on applications etc), she's had the benefit of the capital spending so that's somewhat unlikely to be wiped. If she has used both cards to within the credit limit, that suggests she knew each card had its own credit limit and has stuck to the limit so understands finances. They might mitigate some interest depending on the individual circumstances. I think your bigger worry really is in just over year she's racked up £8k debt - that's quite a lot. I hope you manage to help her resolve her problems

The bank has possibly made a mistake, if the second application was approved without knowledge of the first application due to a system error, would they have given her a credit limit of £8,000? If the answer is no, then that is irresponsible lending and is rightly so the banks responsibility to sort out!

Issuing 2 credit cards that have been applied for is not automatically irresponsible lending

You are correct, I never said it was though!

@Orangefantastic unfortunately, your mother has spent £8k. You and she will now have to figure out how to pay it back.

They might mitigate some interest (depending on individual circumstances). Unlikely in my experience they will write off the capital the credit card holder has spent. Financial Ombudsman doesn't generally require a lender to write off money/capital a borrower has spent

I think there’s a bit more to it than that!

@Orangefantastic No one else does. Why didn’t she hand a card back? She wanted £4,000 limit. So why spend £8,000? Have you actually asked why she didn’t know what she was spending? I’m not far off her age but it’s easy enough to keep tabs on your cc bills. She must have known she was spending on two cards. One of which she didn’t apparently want but spent up to the limit anyway!

I think some people just do get a bit irresponsible when they see easy money.

They forget they have to pay the credit card back at some stage.

These expenses (roof repair, ill dog) would have fallen on your mum whether she had credit cards or not so they are her expenses to pay, I'm afraid. Has your father's financial affairs been sorted out now (I hope so)?

Exactly.

Whether they sent her one card or 10 cards, it's up to her to keep track of how much she is spending. Absurd to think she is exempt from interest charges because she is elderly.

She had the option to live within her means and chose to go on a credit binge. Don't blame the bank for that.

Why is she "vulnerable"??

I'm sorry, what more is there to it? Your mother has capacity, she has built up debt. Debt has to be repaid.

You will have to sit down with her and help her work out a budget and how to cut her cloth. She may have to make economies. If your father sorted all the money stuff, has he not provided for her at all? Do you perhaps need to help her downsize.

Some of the responses to this thread are unbelievable and show that there is a real lack of understanding regarding irresponsible lending.

Regardless of whether the OP's mum should or shouldn't have spent the money is irrelevant. I work for a mainstream bank and we would NEVER issue 2 credit cards in short succession, let alone on the same day!! There is absolutely no way that this would have been done intentionally - it's an error and that it banls fault.

When a customer is approved for credit, there is an assumption that appropriate checks have been carried out and that the level of credit that he been offered is affordable. This will not have been the case for OP's mum.

The bank are responsible for this and whilst we may have our own opinions of the OP's mum spending on both cards, they were cards that she was given by the bank, with available credit on each one. This is exactly what irresponsible lending is

I would be very surprised if the bank don't offer some sort of support. I would be asking for a total interest freeze on the second card as a minimum.

Thank you. We’re going to call this morning and start the ball rolling.

How is the bank responsible for the client's spending??

Did she not review the amount of every bill or purchase before tendering the card? Did she not receive periodic statements?

She spent and spent and spent; the number of credit cards used is irrelevant.

The first thing I would do is call the bank with her next to you as they may need authorisation for them to speak to you. Just explain what has happened and hope they are sympathetic and you can come to some sort of arrangement. She is vulnerable - she has lost her husband and not used to dealing with financial affairs. Finally and most importantly cut up her credit cards asap. Good luck and hope it sorts itself out.

I would say it’s futile going into a branch as the credit card companies operate seperate from the Bank.
Phone the CC company up with your DM present, and ask for the vulnerable customer team - she will need to pass security and give permission for you to speak on her behalf.
I’m pretty sure they will be able to help you here, perhaps by converting the debt to a loan with a lower interest rate. Meanwhile, cancel those cards!

The bank are responsible for the amount of credit that that make available to a customer. Allowing mum 4kX2 in the same day was irresponsible on their part

Having available credit doesn't mean one is forced to use it.

I probably have £20,000 available on my American Express account but I don't spend a fraction of it and pay in full every month.

The bank didn't force her (or any other client) to offer the card as payment for her roof, veterinary bills, etc. was she not keeping track of those costs? How is that the bank's fault?

Because the bank issued 2 identical cards on the same day with identical credit limits. Mum was going through a rough time and was widowed shortly afterwards. She was under financial stress so used the cards. She’s now had to reach out for help from us.

i agree that using the cards was unwise and I’ve discussed this with her at length. She’s explained that she panicked and that she’d manage the payments. She’s also explained that it was easier to use second card than to
reach out for help for help from her children.

if the duplicate card hadn’t been issued then she wouldn’t have had access to that much credit and this would have meant that she would have reached out for help earlier.

regardless of whether she should or shouldn’t have used the cards, Lenders are meant to ensure that any borrowing is affordable.

Those credit limits might be perfectly ok though. Plus it’s not a duplicate card. It’s a second card, hence the £8,000. I’m afraid your DM is just plain wrong. It’s interesting that she was savvy enough to apply for a card but not savvy enough to realise she had two cards and not one. She spent the money, not the bank. I think she needs to accept she spent money that wasn’t hers. There’s more to this story I think. No one accepts two new cards and doubles what they spend without knowing what they are doing. Can she sell what she bought?

It’s also typical of people today that you immediately think it’s someone else’s fault that she spent £8,000 because she could and neither DM nor you take responsibility for her spending actions.

So you think it’s ok to issue an elderly customer with 2 identical cards with 2 identical credit limits on the same day? No, she can’t sell her roof unfortunately.