Amigo Loan Gone Bad

Poppy24

Hi All, I know a lady who was duped into thinking she could trust a relative and agreed to guarantee a loan via Amigo Loans. This works by the money actually being paid to the guarantor who then pays it to the person who needs the loan. Said relative now seems to have no intention of paying her back and is becoming increasingly difficult to contact. The lady in question has since taken out a personal bank loan (at a much better interest rate) to pay off Amigo and rid herself of their extortionate loan rate with but is still left with a big debt. Can she do anything to get her money back?
Cheers.

tell_it_how_it_is

If you've read through some of the posts on the Amigo Loans topic you copied your post onto, you'll see similar tales of woe.

That's what the guarantor is there for, so she is equally responsible. She has done the right thing taking another loan to pay it off and save herself a shed load of cash.

However, I'm afraid the best she can do from hereon in is badger the relative and hope they will do the right thing and make an attempt to reimburse some or all of the money.

Sadly, often in these cases, that just isn't going to happen, and more than likely this will serve only as an expensive lesson. Sorry.

Poppy24

Thanks for your reply. Pretty much as I feared.

ConsumerWizkid

If it was 5k she could threaten small claims court? I'd imagine that wouldn't be something she'd be happy to do but sadly there is no other recourse.

~Brock~

It makes me laugh how Amigo market themselves as a 'good old fashioned loan' when in reality they are simply taking advantage of the general lack of availability of affordable credit.

Banks may well have occasionally requested a guarantor for their loans back in the mists of time, but they certainly did not raid the guarantors bank account the second a payment was missed.

There is only one reason they insist that a guarantor is a homeowner.....so they can eventually get a charge on their property.

The only way this type of lending should be allowed is if the guarantor confirms that they have received appropriate legal advice beforehand.

Pixie5740

ConsumerWizKid is right. Your friend could take this relative to the small claims court to try and recover the money.

However, even if the court finds in your friend's favour the relative could be ordered to pay back some token amount like a £1 as they probably don't have much money hence the Amigo loan.

The relative could then stop paying the £1 a week, your friend goes back to court and maybe a CCJ is awarded against the relative. Would they really care? This person probably already has a CCJ, they will almost certainly already have a crap credit file if Amigo was one of the only lines of credit available to them.

As galling as it is, your friend might just need to chalk this one up to experience. Maybe tell other family members in case they to get talked into guaranteeing a loan or a rental agreement for this A-hole.

BillJones

~Brock~ wrote: »

It makes me laugh how Amigo market themselves as a 'good old fashioned loan' when in reality they are simply taking advantage of the general lack of availability of affordable credit.

There is no lack of ability of affordable credit. What we do have, though, is a set of people who banks are not willing to lend to, because they look unlikely to repay it on time, or at all.

As is always recommended on here, these people should stop trying to borrow more money, but they won't, hence Amigo exist to profit from them.

Pixie5740

BillJones wrote: »

There is no lack of ability of affordable credit. What we do have, though, is a set of people who banks are not willing to lend to, because they look unlikely to repay it on time, or at all.

As is always recommended on here, these people should stop trying to borrow more money, but they won't, hence Amigo exist to profit from them.

I agree with Bill.

If people are at the stage where the only people who are willing to lend them money are outfits like Amigo then they need to STOP borrowing money as they are obviously crap at it.

This kind of borrowing reminds me of the old adverts on television for the likes of Ocean Finance.

"Are you a home owner with lots of debt at CCJs? Then borrow even more money. Take out a £25,000 loan for only £180 a month."

I wonder how many home owners that took out these secured loans are now regretting it. I would reckon over 90% of them.

Poppy24

Thanks everyone. The amount is around £7000 and now that my friend is trying to chase the money it transpires that her relative has already fleeced closer family members for quite a large amount. If only she'd spoken to them beforehand....

superbigal36

For me the next 2 steps would be as follows.

Social networks and full public humiliation if at all possible.

Employing a suitable debt collector who engages in breaking bones etc.

27col

Obviously the relative knew a great deal more about the implications of a a guarantor loan than the guarantor did.