How to complain about unaffordable lending

If a lender gave you a loan, credit card, catalogue account or overdraft you could not realistically afford, you may be able to make an unaffordable lending complaint. The core argument is not just "I struggled later." It is "the lender should have seen this was not sustainable if it had checked properly."

These complaints work best when you show the lender what your finances looked like at the time, not just how stressful things became afterwards.

Key takeaways

• The focus is what the lender knew, or should have known, when it lent or increased credit.
• Lenders are expected to assess creditworthiness, including the risk that repayments will not be affordable.
• Repeat borrowing can be important because it may show dependence rather than normal credit use.
• Bank statements and a borrowing timeline are often the strongest evidence.
• The Financial Ombudsman Service is free and independent.

Who this guide is for

This guide is for people who believe they were given credit they could not afford, including:

• payday or short-term loans
• guarantor loans
• high-cost instalment loans
• credit cards or catalogue accounts with high limits
• overdrafts that became long-term debt
• repeated loans or top-ups
• car finance or other linked finance where affordability was the problem

It is most useful if you can gather records from around the time the lending was approved.

What unaffordable lending means

An unaffordable lending complaint says the lender should not have lent, or should not have lent as much, because reasonable and proportionate checks would have shown the repayments were not sustainable.

"Sustainable" means more than making the payment once. It means being able to repay without repeatedly borrowing again, missing essentials, falling into arrears, or being pushed into financial difficulty.

The FCA's Consumer Credit sourcebook says firms must consider both credit risk and the risk to the customer of not being able to repay affordably. The Financial Ombudsman Service also looks at whether the lender carried out reasonable checks and whether better checks would have shown the lending was unaffordable.

Sources: FCA CONC 5.2A creditworthiness assessment, Financial Ombudsman Service unaffordable lending guidance for consumers, and FOS business guidance on unaffordable lending. Last checked: 23.06.2026.

Warning signs the lender may have missed

The lender may have needed to look more closely if, at the time:

• you already had several debts
• you were using short-term loans or repeat borrowing
• your income was low, irregular or already committed
• you were persistently in overdraft
• you had missed payments, defaults or arrears
• gambling or other high-risk spending was visible on statements
• the new repayment would leave little for essentials
• you received top-ups or higher limits despite earlier signs of strain

The point is not to prove you were perfect with money. The point is to show what proper checks would have revealed.

Common mistakes

• Starting with stress rather than evidence. Explain the financial facts first.
• Treating all borrowing as one event. Show each loan, top-up or limit increase separately.
• Not getting bank statements. Statements often show what a lender would have seen if it checked properly.
• Ignoring the timing. The case turns on what was knowable then, not only what happened later.
• Giving up after a first rejection. Many complaints turn on escalation and better evidence.

What evidence helps most?

Gather:

• credit agreements or account details
• dates, amounts, interest rates and repayment terms
• a borrowing timeline
• bank statements from around each lending decision
• income and expenditure at the time
• existing debts, arrears and overdraft use
• credit-file entries, defaults or missed payments
• evidence of repeat borrowing or top-ups
• the lender's final response

For repeat borrowing, a simple table can be powerful:

Date	Product	Amount/limit	Monthly payment	What else was happening?
3 March	Loan 1	£500	£160	Already overdrawn
10 April	Loan 2	£700	£210	Loan 1 just repaid

How to write the complaint

Use this structure:

1. Identify the lending: product, dates, amounts and account numbers.
2. State the complaint: the lending was unaffordable or checks were not proportionate.
3. Show what the lender should have seen: debts, income, repeat borrowing, overdraft use and other commitments.
4. Explain the harm: interest, charges, arrears, credit-file damage or worsening debt.
5. Attach evidence: statements, agreements and timeline.
6. State the outcome requested.

What outcome can you ask for?

Depending on the facts, people commonly ask for:

• refund of interest and charges on unaffordable lending
• interest on refunded amounts where appropriate
• removal or correction of negative credit-file markers linked to the unaffordable lending
• reduction of an outstanding balance
• fair treatment if the account is still active

Frame this as the outcome you are asking for, not as a promised result.

When and how to escalate

If the lender rejects the complaint, or eight weeks pass without resolution, you can escalate to the Financial Ombudsman Service.

The Financial Ombudsman Service is free, independent, and you keep any compensation it awards. You do not need a claims company. Mind the usual six-month window from the lender's final response, and check current time limits before waiting.

How HeyRefund can help

Unaffordable lending complaints depend on the pattern: what was borrowed, when, what your finances showed, and what the lender should have noticed. HeyRefund helps you build the timeline, organise statements and turn "I could not keep up" into a clearer evidence-led complaint.

You can complain free yourself. HeyRefund just makes the preparation less painful.