Financial ombudsman gets tough on guarantor loan firms

The financial ombudsman has upheld four in every five complaints about guarantor loans in its latest financial quarter, showing a toughening stance towards the product.
The ombudsman upheld 83 per cent of complaints about the loans, which involve a family member or friend being liable to repay a debt if the borrower cannot. This was up from 32 per cent last year. Critics say the rate of interest on the loans is too high given that they are underwritten, and that they prevent those with poor credit histories from improving their situation.

Source: The Times
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