Amigo Loans is a UK-based guarantor lender that caters to those who have poor credit ratings or are unable to secure personal loans from traditional banks. The company has been operating for over a decade, and it has gained a reputation for delivering quick and accessible financial solutions to its customers.
In recent years, however, Amigo Loans has been receiving an increasing number of complaints from its clients. The complaints range from poor customer service to exorbitant interest rates. If you’re interested in applying for a loan from Amigo Loans, it’s essential to understand these complaints and know how to avoid them.
Here are some of the common Amigo Loans complaints and what you need to know about them.
1. Unaffordable Loans
One of the most significant complaints against Amigo Loans is that it offers unaffordable loans with high-interest rates. This is particularly worrying because Amigo Loans mainly caters to borrowers with low-income backgrounds, who can hardly afford the loans they receive.
The company’s guarantor loans come with an APR of 49.9%, which is significantly higher than the industry average. This high-interest rate means customers often end up paying back way more than the loan principal over time.
To avoid this complaint, always read the terms and conditions of your loan agreement. Ensure that you understand the interest rate, the total amount payable, and how long you’ll be paying back the loan. If you’re not sure about the terms and conditions, do not hesitate to ask for clarification from the lender.
2. Poor Customer Service
Another common complaint against Amigo Loans is their poor customer service. Customers have reported waiting for long periods on hold and not receiving adequate support from customer care agents when they finally speak to them.
If you’re considering getting a loan from Amigo Loans, it’s crucial to know whether customer support is one of their strengths or weaknesses. Speak to other people who have borrowed from the company and read online reviews to gather as much information as possible.
3. Mis-Selling of Guarantor Loans
Amigo Loans are guarantor loans, and as such, the company requires your guarantor’s signature on the loan agreement. However, some customers have reported that Amigo Loans mis-sold these loans by not informing their guarantor about the risks involved.
If you’re considering an Amigo loan, ensure that you choose your guarantor wisely. This should be someone that trusts you and understands the risks involved in guaranteeing a loan.
4. Affordability Checks
Amigo Loans are required by law to carry out affordability checks before granting loans to their customers. However, some customers have reported that the company doesn’t do thorough checks, leading to unaffordable loans.
If you suspect that your loan might be unaffordable, it’s essential to speak to Amigo Loans to re-negotiate your payment arrangement or loan terms. If the lender’s customer care agents do not offer you much help, you can reach out to the Financial Ombudsman Service to report the issue.
5. Debt Collection Practices
Amigo Loans has also faced criticism over their debt collection practices. Some customers have reported receiving incessant and harassing calls from the company or its debt collection agency.
It’s vital to remember that debt collectors should not harass, intimidate, or threaten you. If you feel that Amigo Loans or its debt collection agency is harassing you, you’re well within your rights to report them to the Financial Ombudsman Service.
Conclusion
If you’re considering an Amigo loan, it’s crucial to understand the complaints raised against the company and how to avoid them. Always read the loan agreement thoroughly before signing and understand the terms and conditions involved. Choose your guarantor wisely and know the risks involved in guaranteeing a loan.
Additionally, seek to gather as much information about Amigo Loans as possible before committing to a loan agreement. Read online reviews, speak to other people who have borrowed from the company, and assess their customer service levels.
By doing these things, you’ll be well on your way to avoiding some of the most common Amigo Loans complaints.