Guarantor Accepts Miss Sold Loan via Amigo following the borrower putting in the claim. 12 May 2021 at 10:47PM in Loans 8 replies 535 views

Waa

If a Guarantor accepts the Amigo Loans miss sold settlement sum following the borrower actually putting in the claim can the guarantor still legally accept the settlement if the borrower had settled their dept with the guarantor? 

sparklep0ny

If the guarantor is no longer out of pocket, not the interest at least.

I suppose there is an argument to be made they could accept any amount offered as compensation.

It's the borrower who is out of pocket and reimbursement of interest should go to them.

Waa

sparklep0ny said:

If the guarantor is no longer out of pocket, not the interest at least.

I suppose there is an argument to be made they could accept any amount offered as compensation.

It's the borrower who is out of pocket and reimbursement of interest should go to them.

Thanks, in the circumstance part of the settlement figure clears the Borrowers debt with the Guarantor after 9 plus years of it being owed, should the interest be divided between both parties fairly based on %’s held after the Guarantor had paid back the difference to the Borrower from the payments made part of the refund? Ie Borrowers debt with Guarantor was say £1000, settlement figure was £3000 (made up of £2000 of payments made by Guarantor and £1000 interest), G pays the B £1000 difference in debt owe from the payments made section, should the interest be split fairly at 50/50 or should the B be entitled to all of it? Can the Borrower threaten legally action and take the Guarantor to the small claims court over the interest? 

sparklep0ny

Waa said:

sparklep0ny said:

If the guarantor is no longer out of pocket, not the interest at least.

I suppose there is an argument to be made they could accept any amount offered as compensation.

It's the borrower who is out of pocket and reimbursement of interest should go to them.

Thanks, in the circumstance part of the settlement figure clears the Borrowers debt with the Guarantor after 9 plus years of it being owed, should the interest be divided between both parties fairly based on %’s held after the Guarantor had paid back the difference to the Borrower from the payments made part of the refund? Ie Borrowers debt with Guarantor was say £1000, settlement figure was £3000 (made up of £2000 of payments made by Guarantor and £1000 interest), G pays the B £1000 difference in debt owe from the payments made section, should the interest be split fairly at 50/50 or should the B be entitled to all of it? Can the Borrower threaten legally action and take the Guarantor to the small claims court over the interest? 

Guarantor loans are a mess because often times the "guarantor" is essentially the borrower.  The money gets paid to them and this is probably why the redress is being paid to you.

Ultimately you should end up no better or worse off than when you started, so if splitting the interest 50/50 achieves that, then fine.  As you've been reimbursed by the "borrower" I'd say that anything other than compo should go to them.

SeanG79

The thing is if you failed to make repayments on time, the guarantor's credit file will have been trashed. If I was the guarantor, I would be keeping the compensation if it was paid to me. Whatever mistakes the lender made, the borrower led the guarantor to believe the payments were affordable (else they likely wouldn't have been a guarantor), ultimately it is the guarantor who has been mis sold by both the lender and the borrower...

MattMattMattUK

If I had screwed someone over by failing to make payments on a loan that they were guarantor for I would not be looking to take any compensation for myself.

Waa

SeanG79 said:

The thing is if you failed to make repayments on time, the guarantor's credit file will have been trashed. If I was the guarantor, I would be keeping the compensation if it was paid to me. Whatever mistakes the lender made, the borrower led the guarantor to believe the payments were affordable (else they likely wouldn't have been a guarantor), ultimately it is the guarantor who has been mis sold by both the lender and the borrower...

I’m the guarantor, the borrower paid some back at the time but in the end owed money from this and other money lent to them. I’ve recovered the debt owed now from this repayment from Amigo but they believe they should be entitled to the whole compensation/interest. I’ve offered to work a fair percentage split based on the difference but they believe this is unfair and they are threatening small claims court unless they get the whole 100%, I can’t see how they can do this but I’m no legal expert, surely I should be entitled to interest on my money held up in this account for the 10 years or so, well that’s how I see it. I could have invested the money else where rather than helping a friend out of a hole, which ultimately effected me financially. 

MattMattMattUK

Waa said:

SeanG79 said:

The thing is if you failed to make repayments on time, the guarantor's credit file will have been trashed. If I was the guarantor, I would be keeping the compensation if it was paid to me. Whatever mistakes the lender made, the borrower led the guarantor to believe the payments were affordable (else they likely wouldn't have been a guarantor), ultimately it is the guarantor who has been mis sold by both the lender and the borrower...

I’m the guarantor, the borrower paid some back at the time but in the end owed money from this and other money lent to them. I’ve recovered the debt owed now from this repayment from Amigo but they believe they should be entitled to the whole compensation/interest. I’ve offered to work a fair percentage split based on the difference but they believe this is unfair and they are threatening small claims court unless they get the whole 100%, I can’t see how they can do this but I’m no legal expert, surely I should be entitled to interest on my money held up in this account for the 10 years or so, well that’s how I see it. I could have invested the money else where rather than helping a friend out of a hole, which ultimately effected me financially. 

The losses and costs incurred by you entitle you to the compensation. If you have offered to them, in writing a proportional split of the interest/compensation then that is more than reasonable, due to the impact it had on you. Let them take you to court, they will lose, it will have cost them. Make sure you get rid of this toxic and selfish person from your life. 

sparklep0ny

MattMattMattUK said:

Waa said:

SeanG79 said:

The thing is if you failed to make repayments on time, the guarantor's credit file will have been trashed. If I was the guarantor, I would be keeping the compensation if it was paid to me. Whatever mistakes the lender made, the borrower led the guarantor to believe the payments were affordable (else they likely wouldn't have been a guarantor), ultimately it is the guarantor who has been mis sold by both the lender and the borrower...

I’m the guarantor, the borrower paid some back at the time but in the end owed money from this and other money lent to them. I’ve recovered the debt owed now from this repayment from Amigo but they believe they should be entitled to the whole compensation/interest. I’ve offered to work a fair percentage split based on the difference but they believe this is unfair and they are threatening small claims court unless they get the whole 100%, I can’t see how they can do this but I’m no legal expert, surely I should be entitled to interest on my money held up in this account for the 10 years or so, well that’s how I see it. I could have invested the money else where rather than helping a friend out of a hole, which ultimately effected me financially. 

The losses and costs incurred by you entitle you to the compensation. If you have offered to them, in writing a proportional split of the interest/compensation then that is more than reasonable, due to the impact it had on you. Let them take you to court, they will lose, it will have cost them. Make sure you get rid of this toxic and selfish person from your life. 

It seems to me (and I may be wrong) that as guarantors and borrowers are both entitled to make their own claims for misselling/irresponsible lending  (as a loan may have been affordable to the guarantor and not the borrower or vice versa) the OP, if they wish to have a payout, should be making their own claim with anything that takes them past the point of being square going back to the borrower.

I understand the reluctance to do that but I certainly don't think the compensation is legally the guarantors in this instance.