Specialist Motor Finance Limited · DRN-6072526

The complaint Mr O complains that Specialist Motor Finance Limited unfairly terminated his hire purchase agreement and failed to support him during his financial difficulties. What happened In November 2022, Mr O acquired a car through a hire purchase agreement with SMF. He was due to make 59 repayments of £394.06, followed by a final payment of £404.06. Mr O said his car was off the road and therefore wasn’t taxed, and it didn’t have a valid MOT in place. He said that despite experiencing financial difficulties, he didn’t receive any support or understanding from SMF. Mr O also said he needs the car to enable him to provide support to others with additional needs. He said he’s able to make some payments towards his agreement but doesn’t think SMF is considering his situation properly. In October 2025, SMF issued their final response to Mr O’s complaint. In summary, it said the terms of the agreement require the car to be taxed and to have a valid MOT, which at the time of the complaint it did not. SMF said it believed it had acted fairly, given Mr O sufficient time to bring the account up to date, and offered reduced payment arrangements—which were not maintained. SMF didn’t uphold the complaint and advised that the termination process had already been initiated. Unhappy with SMF’s outcome, Mr O brought his complaint to this service, where it was passed to one of our investigators to look into. In their file submission, SMF confirmed that the agreement had been terminated. However, Mr O hadn’t returned the car. In December 2025, the investigator issued their view and recommended that Mr O’s complaint should not be upheld. In summary, the investigator concluded that SMF had acted fairly in the support it offered Mr O. Mr O didn’t accept the investigator’s view and asked that his complaint be referred to an ombudsman for a final decision. He added that he didn’t think SMF had given enough consideration to his affordability, felt they should have done more before seeking repossession, and said he wasn’t given any alternatives. What I’ve decided – and why I’ve considered all the available evidence and arguments to decide what’s fair and reasonable in the circumstances of this complaint. Firstly, I acknowledge what Mr O has told us about his situation, and I’m sorry to hear about this. I recognise this would likely have made things more difficult for him. If he hasn’t already done so, Mr O may decide to seek further support from recognised organisations. Further

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information about this can be found on our website at the following address: https://www.financial-ombudsman.org.uk/accessibility/additional-support In considering what is fair and reasonable, I’ve thought about all the evidence and information provided afresh and the relevant law and regulations, regulators’ rules, guidance and standards, codes of practice and (where appropriate) what I consider to have been good industry practice at the relevant time. I’ve read and considered the entire file. However, I’ve focused my comments on the points I consider most relevant to reaching a fair outcome. If I haven’t commented on a particular issue, it isn’t because I overlooked it; rather, I didn’t consider it necessary to address it explicitly in order to reach my decision. Having carefully reviewed the circumstances of this complaint, I’m satisfied that SMF treated Mr O fairly. I explain my reasoning below. The statement of account provided by SMF shows that the agreement fell into arrears from May 2024 and again in January 2025. The system notes confirm that Mr O contacted SMF in early 2025 to discuss the arrears and asked for a payment plan. However, that arrangement broke down when the payment wasn’t received. I can also see that Mr O continued to indicate his intention to pay and to settle the account in full, but these payments didn’t materialise, and the arrears continued to increase. Under the Consumer Credit Act 1974, a business must issue notice to a borrower before it becomes entitled to take certain steps, including terminating an agreement or recovering goods. I can see that SMF issued Mr O with a default notice warning that the agreement could be terminated if the arrears were not cleared. When the default notice was not remedied, SMF wrote to Mr O again in June 2025, giving him seven days to respond. The agreement was subsequently terminated on or around 24 June 2025—the matter now under complaint. SMF’s system notes also show that on 11 June 2025, Mr O told SMF he was expecting a payout and intended to use part of it to clear the balance. SMF asked for evidence of this, but I’ve seen no indication that such proof was provided. The terms of the agreement, under the section “What happens if you miss payments?”, clearly state that failing to make a payment may have serious consequences, including making it harder to obtain credit in the future. The agreement also explains that SMF may be entitled to charge fees or interest or end the agreement—at which point the unpaid balance becomes payable and the vehicle must be returned. Given these terms, I don’t consider SMF’s actions disproportionate. I’m satisfied they acted fairly throughout. Mr O also said he didn’t feel SMF treated him fairly in respect of his affordability. I’ve thought carefully about this. The Consumer Credit Sourcebook (CONC), which forms part of the Financial Conduct Authority’s (FCA) handbook, requires businesses to treat customers in arrears with forbearance and due consideration. Examples include suspending or reducing interest, waiving charges, offering payment deferrals, or accepting token payments. From the system notes, I’m satisfied that SMF engaged constructively with Mr O throughout the arrears period and offered him repayment options to support him. I’m satisfied they demonstrated forbearance in the circumstances. This continued even after the agreement had been terminated. Considering the seriousness of the arrears and the vehicle’s status—

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being untaxed, uninsured, and without an MOT—I find SMF’s decision to proceed with repossession to be reasonable and in line with the agreement’s terms. I therefore don’t consider SMF acted unfairly. Overall, based on the evidence provided, I’m satisfied that SMF treated Mr O fairly in the circumstances and took reasonable steps to settle the agreement and recover possession of the vehicle. My final decision My final decision is that I don’t uphold Mr O’s complaint about Specialist Motor Finance Limited . Under the rules of the Financial Ombudsman Service, I’m required to ask Mr O to accept or reject my decision before 23 April 2026. Benjamin John Ombudsman

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