Borrower not able to understand the terms and conditions of a loan

Squareclean

Can you please help me resolve the following problem?

My friend's application for a loan was rejected on the grounds of them not being able to understand the rules of the loan agreement. They don't speak English very well.

I acted on the behalf of them, but after the provisional deal was agreed I could not proceed further with the application over the phone.

How can such a problem be sorted out? Can such a person hire an interpreter? I am not a certified interpreter myself, and am not related to the borrower.

The loan was from a firm that deals with unsecured credit and is authorised and regulated by the Financial Conduct Authority.

Thank you for your help.

MEM62

It is not unreasonable for the lender to expect that the terms and conditions of the loan are understood by the borrower.  You giving them a verbal translation of a complex agreement is neither acceptable or sufficient.  It is unlikely that your friend will be able to pursue this.    

Hoenir

Do you have the legal authority to act on your friends behalf? 

DullGreyGuy

MEM62 said:

It is not unreasonable for the lender to expect that the terms and conditions of the loan are understood by the borrower.  You giving them a verbal translation of a complex agreement is neither acceptable or sufficient.  It is unlikely that your friend will be able to pursue this.    

But they aren't "expecting" them to be understood they are "requiring". It's certainly a good, and surprising thing, hard to argue they are an irresponsible lender out the back of it. 

I'd suggest you speak to the company in question about how they would get comfortable with a non-english speaker taking a loan from them or apply online where the lender won't know/see if the applicant is reading the instructions themselves or having a friend interpret 

Squareclean

Hoenir said:

Do you have the legal authority to act on your friends behalf? 

No, I don't. My friend completed an online form and got a provisional agreement but then needed to proceed with the application over the phone. When I told the company that I am helping her with the application as she does not speak very well English, she was refused. I also offered that I will interpret with her sitting besides me and clarifying things, supporting her with her limited English but it didn't work. They just refused.

When using public services like NHS, council, HMRC etc or even some commercial ones like insurance or telephone companies, it usually helps to identify the person by giving details, then sometimes giving verbal permission that I can act on her behalf, and then I can interpret or carry on with the whole conversation until the problem is sorted out. But I admit in these cases some forms of contract have already been made in the past, so there is no problem.

In this case, however, when a new agreement was to be made, she was refused.

MeteredOut

I can understand why the lender is doing this. If they can't get confirmation that the terms of the loan are understood, and particularly now that the lender is aware that the loanees do not understand the terms of the loan, they would be opening themselves up to all sorts of irresponsible lending claims in future (eg, at a very basic level, the loanees could claim they were not aware they had to pay back the loan.)

I suspect your friend may have to look via an alternate route, perhaps via a broker, or a lender who will do a face-to-face application with an interpreter.