Amigo Loan Problem

worried_gran

I know its a hard time for us all, but my brother almost committed suicide last year. We bailed him out with money to get him back on his feet. But he is now laid off throughout this Lockdown, behind with his rent, and now has not been paying his Amigo Loan that I guaranteed a few years ago for him. So I have paid the past couple of months as guarantor. I thought I'd got the account frozen or whatever they do, last month as I emailed them. So I was shocked to find this morning I'd been debited again. Amigo didnt reply to my previous email, but I assumed I'd be OK. They obviously dont have anyone working now.
I was told last Monday that I will be redundant as of end June, but furloughed from end of May - 2 weeks time. I am 64, reasonable credit history and with my husband we own our own house - no mortgage. So bills are not huge, just both of us have credit cards to pay back each month, nothing over limit or pressing. But with neither of us working right now and husband in the hospitality industry that wont get back on its feet till next year, I could do without an extra bill of having to pay back my brother's Amigo loan.
Brother has nothing and his first priority is to avoid being evicted as like I said behind on his rent, not working. I intend going to my bank tomorrow to ask what I can do. Someone suggested changing my debit card then Amigo cannot debit my account. It might be that Amigo might be helpful, if or when they have staff to answer queries.
Does anyone have any idea please on what I should and/or should not do as I think there is over £2000 still outstanding on the loan - not that they will discus with me as its in my brother's name.

Jeremy535897

I think you must accept that as guarantor you will end up paying this loan off, so the sooner you do and stop more interest accruing, the better. If they expect you to pay as guarantor they will have to tell you how much is outstanding. But I would head over to the debt management forum as they will know a lot more than I do

gary83

I don’t think just cancelling a debit card is the answer, if it was that easy then everyone would just do that. 

Amigo’s business model is lending to people thats credit history would otherwise get a no. They then step up with a higher rate of interest knowing that if the repayments stop they’ll have a guarantor to fall back on. With the benefit of hindsight & appreciating nobody saw Covid coming,  it would have been cheaper for you to take out a loan at the interest rate available to you and then pass that on with the expectation that your brother pays you back, but knowing if he didn’t pay you back you’d be liable for the loan, something that’s happened now anyway. Head over to the loan specific forum on here for more advice on dealing with Amigo, good luck with it.

gizmo111

Is this a direct debit or continuous payment? 
https://www.fca.org.uk/news/news-stories/continuous-payment-authorities-it-your-right-cancel

What did you actually e-mail them - were you clear you couldn't afford to pay?  A payment holiday will end up costing you loads more.
 The problem you have is as guarantor they will come to you for payment and any payment not made will reflect on your credit report as well as your brothers.  Whilst I would never normally suggest it - is there any possibility that you could use your credit card to get a cash advance and pay it off and by doing so reduce the interest?  Or can you use emergency savings to get rid of this and sort repayment with your brother?
Advice to go to debt free board is good.

sharpe106

If you have good credit history can you not get a credit card with 0% interest that be far cheaper in the long run.

Fire_Fox

Definitely repost on the MSE Debt Free Wannabe board. You will likely need to write letter(s) rather than telephone or e-mail.

KimStyles

I complained to Amigo in 2019 and this was upheld due to the fact the loan was not affordable to me.  My Guarantor has now been offered a refund of the interest they have paid.  However, Amigo have now told me that I owe them £5,700 (the original loan was for £10k).  How can they uphold a complaint stating that the loan was unaffordable to me and then try and put me into more debt of £5,700?  Is this legal and can they uphold it please - Does anyone have any ideas?

KimStyles

PS:  The loan was settled in full so at the present time there is no money outstanding!

[Deleted User]

You'll need to ask Amigo.

Galloglass

Assume Amigo upheld their own decision?

Search the Financial Ombudsman site for decisions concerning these loans as there may be one or two that will give you insight on how to approach this.

https://www.financial-ombudsman.org.uk/files/238841/DRN2108651.pdf

And less than a month ago
https://www.financial-ombudsman.org.uk/businesses/complaints-deal/consumer-credit/guarantor-loans

The guy that started Amigo himself thinks Amigo has been lending where it shouldn't (“almost all their loans had been made irresponsibly”) and it has been reported elsewhere
https://debtcamel.co.uk/amigo-board-room-bust-up/

Can see COVID generating a lot of Amigo issues.