Clients left in the dark unless lenders explain rejections

After learning that the Financial Services Authority does not want lenders to justify declined cases I was reminded of a recent case where my client was turned down. The lender was uncooperative but I was able to determine that it was a credit-worthiness problem.

However, the client had never had any credit problems. It took over a month and many frustrating letters and telephone calls to establish that the lender had viewed information held by Experian relating to someone with the same first and last name who had lived in the same apartment block at some point during the three years my client had lived there.

We have a system in the UK where anyone can deposit information on the systems of credit firms. This information is then searched by banks, credit card companies and utility firms to establish an individual’s creditworthiness.

In one case the lender had viewed details of someone with the same first and last name as my client and who had lived in the same block

When lenders refuse to lend clients are left in the dark about why they have been refused and it can be impossible to clear their name because they have no idea which company has made an error about them.

Sometimes a lender will ask a client to check their financial records to try and identify the source, but this is pointless if the client has been mis-identified by the company. It can also be hard to extract information from firms like Experian. The Information Commissioner’s Office has a lot to answer for and the Data Protection Act allows everyone access to personal information. It provides institutions with the capability to file unchecked, inaccurate information while the ICO does nothing.

To add insult to injury, the firms then use the information to send e-mails trying to flog their products. It is an unacceptable state of affairs.

Bill Wells