pensioners and irresponsible lending

[Lipticpetal]

Morning,

Does anyone any advice regarding irresponsible lending? My mum is 76 and I have just discovered that she has racked up about £18k in credit card debt over the last 4 years.

At the time of applying she had a state pension income and a very small ( £150pm) private pension. She has been given 5 credit cards by 4 different lenders over the course of 4 years, the most recent one being at the end of 2023.

I accept that there has to be personal responsibility, however I am aware that there are rule regarding responsible lending. Does anyone know if it would be worth issuing complaints? I am particularly annoyed that the most recent cards were issued when they could see that she was accruing debt very quickly.

How did your mum apply for the cards? Does she understand what she was doing and how cards work?

You can and absolutely should make a complaint to each individual lender about irresponsible lending, based on the fact she had very limited income with no scope to increase that. They won't wipe the balances but they will remove/refund all fees and interest and agree payment plans. At her age, she could ever look at an IVA/bankruptcy, speak to StepChange for advice.

If the lenders reject the complaint, you can refer them for free to the financial ombudsman. www.financial-ombudsman.org.uk/businesses/complaints-deal/consumer-credit/unaffordable-lending

I get why you asked that, however if money has been lent irresponsibly then it doesn’t matter what the OP’s mum has spent it on.

If she's been making payments on all the cards, they might be able to argue that it's not unaffordable. Has she answered the questions about income and expenses honestly?

But if you read the link above above an unaffordable lending complaint, even if it is upheld it doesn't mean they won't expect her to repay the money that she's borrowed, just that some of the interest might be refunded.

If she cannot afford to repay her debts, that would be a separate matter. I expect that she's been using the money on her living costs. What is her actual income and is she entitled to any top ups? With an old style state pension and very small private pension, she might be entitled to pension credit, especially if she's not getting the full state pension. What's her housing situation? If she owns her home, could it be time to downsize to free up capital, some of which could be used to repay her debts and move somewhere smaller that's cheaper to run and easier to manage?

If the above is not an option, she'll need to review her budget and talk to her lenders about a repayment plan. But she will need help before she does this, so Moneysaving Expert is probably a good starting point.

https://www.moneysavingexpert.com/loans/debt-help-plan/