There are times when you are liable to compensation of the payday loan you took or didn’t even take. But not every lender is willing to compensate for the frustration or agony you went through. What you as a borrower need to understand though is that every lender is supposed to allow their borrowers certain ease of borrowing.
For example, they are required to let the clients know how much the total cost would be, including the interest rates and their own fee, the applicant would need to pay at the completion of the loan. What’s more, the lender also needs to tell the applicant of the loan that payday loans are not meant for long term and if the finances of the person are not in order, they should not get those loans. It is also the job of the creditor to check up the personal as well as financial situation of the borrower. This way, they can ascertain the fact that the client is able to pay the loan in time.
If these were the things that you as the applicant of the loan were not made aware of, or if the lender did not tell you of all the requirements and now you are in for a compensation but the lender continues to refuse, here is what you should do.
Write a Letter to the Lender
Before trying anything else, the very first thing you need to do is to write a letter to the lender. This is the letter that will contain the detail of all the things the lender did not inform you about or not do that needed to be done according to law. Mention what it is you want the lender to do. Tell them what compensation you require, or how much amount you can easily pay. If the lender does not answer within five days of the written letter, you have the right to take your case further. If they do take some action, they will inform you immediately.
Get in touch with Authorities
Since the lender is not responding to your complaints, you have the right to talk to authorities. Keep in mind though, you have to let the lender have 8 weeks before you take any legal action. The complaint can be registered at Financial Ombudsman Service, where they will consider compensations and refunds. The FOS will look at your situation and decide what is the best course of action. If they come out in your favour, the lender is required to do as told and pay compensation. If not, and the outcome is not in your favour, you have the choice of taking the lender to court.
You can also place your complaint with a trade association like the British Cheque & Credit Association as these are the ones all lenders are associated with. Check who your payday lender is associated with and file a complaint there. This way, you can also have your compensation paid.