In May 2023, Kai applied for a business credit card with his lender. Kai used his business credit card for purchases between May 2023 and December 2023. By late December 2023, he fell into hardship and stopped making payments. The balance owed was $8,403.39.
While discussing a hardship payment arrangement with the lender, Kai complained that one of the lender’s employees had altered details on his application form so that he would qualify for the business credit card. Kai complained to FSCL.
Dispute
Kai said that when he signed up for his business credit card, the lender’s employee told him that his annual salary of $45,000 wouldn’t qualify, so the employee changed his income on his application form to $60,000. Kai said that this was irresponsible lending.
The lender explained that Kai had provided financial statements to them showing that his income was $60,000 per year.
Review
We could see that Kai signed the application listing his income as $60,000 per year on two separate occasions. He first signed the document normally, and he signed it again a few days later to make his hand-written date clearer. Kai had received the benefit of using the business card, had made a number of purchases and managed to make repayments, and there was a financial statement confirming his income for the 2021 to 2022 year as $75,000 before tax.
In light of Kai’s hardship, we suggested the parties should enter into a repayment arrangement. To resolve the complaint, the lender offered to freeze Kai’s debt at $8,403.39 and not require any payments for three months. After those three months, Kai would then be able to contact the lender to discuss his financial situation and possibly set up a payment plan.
Resolution
Kai accepted the lender’s offer, so we closed our file.
Insights for consumers
This case highlights the importance of reading documents before signing them. There was insufficient evidence that the lender’s employee changed Kai’s income amount on the application form. However, even if the employee had changed the amount on the application form, Kai had still signed the document which he said incorrectly recorded his income.
