THOUSANDS of Amigo Loan customers are one step closer to getting their money back.
Amigo have been accused of making bad loans that customers have been unable to repay – but now they are slowly closing in on the compensation owed them.
Court hearings were held on May 23 to approve the New Business Scheme, which Amigo wanted to pay back to its customers.
Commenting on the outcome of the hearing, Amigo Chief Executive Officer Gary Jennison said, “We are pleased that the court has decided to allow creditors the opportunity to maximize their recovery from Amigo.
“The court’s ruling is good news for creditors, customers and employees, and it brings us one step closer to paying compensation and putting an end to past mistakes.”
We asked debt expert Sara Williams, who runs consumer advice blog Debt Camel, what it means next.
She said: “Now the court has approved the Amigo scheme. The next step is for Amigo to announce when the program will start and set up a page where customers, both borrowers and guarantors, can enter a claim.”
If a borrower wins their claim at that point, they’ll get back a portion of the interest they’ve paid, which can be as high as 41%.
But most of the claims relate to affordability, Sara explained.
She said: “An Amigo loan is only affordable for the borrower if, at the time the loan was made, the borrower was likely to be able to make all the repayments required without being able to pay their other debts, bills and living expenses, and would not have to borrow more.” .
“Many people will have been desperate to protect their guarantor, so they may have gotten payday loans, topped up their credit cards, or defaulted on bills to pay Amigo.
“Even though the Amigo loan was repaid on time, it may still have been unpayable.”
Amigo warned last year that it could collapse under the weight of customer refund requests.
Established in 2005, the loan company offers loans of up to £10,000 over 12 to 60 months at an interest rate of 49.9% to borrowers who have typically turned their backs on traditional lenders.
It would also lend to people with bad credit, as long as a friend or family member agrees to make repayments if they can’t.
But in March 2020, the company’s founder claimed customers received “irresponsible” loans.
That’s what started the compensation fight on the way to thousands of customers after this latest update.
But even though the program has been approved, customers still have to wait for Amigo to create a damage page.
Once it goes live, they could have just six months to take action, according to Debt Camel.
You can still make a claim even after you’ve repaid the loan if you were having trouble making the payment at the time.
If you’re still paying off your debt, you can still complain if you’re having a hard time paying off the cash package.
To file a complaint with Amigo, you should contact us as soon as possible.
Send a short email to [email protected] with COMPLAINT in the subject line.
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