Have you recently taken out a payday loan and feel that you are owed compensation? According to the Financial Ombudsman, the number of complaints that were being made about payday loan companies rose by around 178% in the year to March 2017, showing that plenty have started their applications for a mis-sold payday loan claim already.
Six steps to receiving your mis-sold payday loan claim
There are six steps to take that will help you to receive compensation for your mis-sold payday loan. Each of these steps will ensure that you are fully prepared to go through with the claim and will help you to have the correct information relating to your loans and then claim that you will be making.
Most claims end either by reaching out to the lender and receiving compensation from them, or from following through your claim with a claim service that will help you if you were unhappy with the response from your lender. These steps will help you to be prepared for both options, so you won’t struggle when fighting for your compensation.
Step 1: Check that you’re eligible to claim
When you make your claim you need to be able to prove that there was “unfair lending” involved in your case, and that your loans couldn’t be repaid without any “undue difficulty”. The FCA states that any payday loan you take should be affordable for you, so you shouldn’t have had any difficulty repaying the loan the following month, and should have been able to pay your rent/mortgage, food, bills, transport and any other debts you may have had.
If you found that you had to keep borrowing money or were making late payments for your payday loan, or you couldn’t make other payments then your payday lender(s) were lending irresponsibly – which is how you could be entitled to receive compensation.
Step 2: Gather your facts
You’ll need to have a list of your loans prepared to prove that you were treated unfairly – you might be able to get this from your online accounts that you have with the lenders themselves, or your bank statements or credit report may also have these available.
Step 3: Build your case
Building a strong case can help you to prove that your payday loan was unaffordable, which will hopefully convince the lender that they need to settle with you before you have to take your claim further.
Once you’ve made your list of payday loans that you took out you’ll also need to add details like your monthly/weekly income, and your expenses – this will include things like rent, council tax, gas and electricity, telecoms and broadband, transport, clothing, insurance, supermarket shopping, childcare and other debt payments.
Step 4: Contact your lender(s)
Once you’ve compiled your list of loans and your income and expenses, you can submit your claim(s) to your lender(s). Writing a letter or email is the best way to contact them (as it can help you to track time passed since sending), and helps you to lay out your claim clearly to the lender.
Your claim should state that you wish to complain that you received “unaffordable loans”, and that you want a refund of all of the interest you paid, as well as any charges that you paid on the loan – plus the 8% statutory interest on top. You should also ask for your loan to be deleted from your credit record it it is still there, as you don’t want this to continue damaging your credit score.
Step 5: Wait for (up to) 8 weeks
Your payday lender will have 8 weeks to respond to your mis-sold payday loan claim, and may be likely to respond with a rejection letter or a small offer of compensation. You don’t have to accept their offer, especially if you are sure that you paid significantly more in interest than they are offering you.
Many payday lenders offer a ‘goodwill gesture’ to reduce the amount that they have to pay back in claims, but you shouldn’t feel that you have to accept this – you should make sure that you’re receiving the full amount of compensation that you are owed.
If you’re given an offer then don’t worry about losing it if you don’t accept straight away – make sure you sit down and think about if this is enough money for you before you sign anything.
If you’re sent a letter of rejection, don’t worry, as you still have the right to take your complaint to a claim service 8 weeks after you first raised the issue to ensure that you’re getting fair compensation.
Step 6: Find a claim service
If you’re not happy with your offer of settlement, or your claim was rejected – or your lender failed to writer back to you at all – then you can still forward your claim to a claim service. Once you find a reliable claim service to help you further your claim, you shouldn’t struggle to make your mis-sold payday loan claim.
If you have more than one lender then you should put in separate complaints for each lender. From here an agent will investigate your complaint and they’ll reach an opinion based on the information you include – so make sure your claim is fully researched.
If your claim is upheld then you should get a full refund of interest as well as charges paid, plus a statutory interest of 8% on top.
If you are struggling to find a reputable claim service that will help you to investigate your case for your mis-sold payday loan claim, you shouldn’t look much further – by simply filling out your details here on Consumer Rights you’ll be able to get in contact with a trained agent who will know exactly how to handle your claim. In no time you’ll know whether your claim will be pursued, and you’ll be working with a knowledgeable agent who can help you receive exactly what you’re owed.