DRN-6242222

The complaint Miss S complains about the quality of a vehicle that was supplied through a motor finance agreement with BLUE MOTOR FINANCE LIMITED (BMF). Miss S is also unhappy about some aspects of the administration of the agreement. What happened In January 2022, Miss S acquired a used car through a hire purchase agreement with BMF. The car was about nine years old and, according to MOT records, had travelled around 84,500 miles when it was supplied to her. The cash price of the car was £5,995, with a listed deposit of £1,500. This meant the total amount financed under the agreement was £4,495, payable over 60 instalments of £104.51. Miss S said that, from the outset, she was never given a copy of the agreement and that the vehicle detailed on the agreement differed from the one she received. She also said her repayments were taken a month later than she expected, which resulted in her falling into arrears. As a result, in July 2022 BMF issued a default notice and terminated her agreement. Miss S said her credit file was affected and showed incorrect payment information. She said that over four years she had missed only three payments, rather than the 12 payments BMF reported. In April 2025, BMF issued a response to Miss S confirming that the vehicle provided to her differed from what was listed on the agreement. However, it said her continued use of the car and maintenance of monthly contractual repayments affirmed that the agreement existed. Miss S said this response brought into question the accuracy of the contract. Miss S said the car broke down in July 2025 and was taken to a garage. She said she transferred ownership of the vehicle to BMF, but it was not collected and was instead classified as abandoned. Storage charges were subsequently incurred, which Miss S said she should not have to pay. In August 2025, Miss S requested to voluntarily terminate (VT) the agreement, but this was denied. She said it was at this point that she realised the extent of the problems with the agreement. In September 2025, BMF issued its final response to the complaint, which it did not uphold. In summary, it said that as the issues arose more than six months after supply, it was Miss S’s responsibility to provide evidence that the faults were present at the point of sale. BMF’s system notes show that it issued a further final response in October 2025. This advised that the agreement had been signed by Miss S, reporting to credit reference agencies (CRAs) was accurate, the agreement had been defaulted and terminated fairly, and that Miss S had been informed of this. Unhappy with BMF’s outcome, Miss S brought her complaint to this service, where it was passed to one of our investigators to consider.

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Miss S told the investigator that she had been affected both financially and emotionally as a result of the issues, including having to pay for the agreement, recovery fees, and printing and postage costs. In February 2026, the investigator issued their view and recommended that Miss S’s complaint should not be upheld. The investigator confirmed that a previous complaint had already considered the validity of the agreement and the accuracy of the credit reporting. They also said Miss S had not raised a complaint directly with BMF about irresponsible lending, and that BMF should be given the opportunity to respond to this in the first instance. Overall, the investigator did not consider that BMF had acted unfairly or that the car was of unsatisfactory quality at the point it was supplied. Miss S did not accept the investigator’s view and asked for her complaint to be referred to an ombudsman for a final decision. She added that she did not agree to a payment arrangement and said her main concerns related to the validity of the agreement and the accuracy of the data being processed. 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. 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 whole file, but I’ll concentrate my comments on what I think is relevant. If I don’t comment on any specific point, it’s not because I’ve failed to take it on board and think about it but because I don’t think I need to comment on it in order to reach what I think is the right outcome. Miss S complains about a hire purchase agreement. Entering into consumer credit contracts like this is a regulated activity, so I’m satisfied we can consider Miss S’s complaint about BMF. BMF is also the supplier of the goods under this agreement and is responsible for a complaint about their quality. I’ve considered all the information provided about this complaint. Miss S has raised a number of concerns relating to the administration of her agreement. Following the investigator’s view, Miss S responded in March 2026 to say her main concerns related to the validity of the agreement and the impact on her credit file. In resolution, she said she would like the vehicle to be collected and her credit file corrected, including the removal of any adverse information. Miss S previously raised a complaint with this service about the validity of the agreement and the accuracy of her credit file. Those concerns were considered by this service, including issues relating to the signing of the agreement and incorrect details recorded on it. That complaint was not upheld and was closed. As part of the conclusion, it was found that by continuing to make repayments over the period she did, Miss S had accepted the terms of the contract. While I acknowledge that the agreement and Miss S’s credit file remain central to her concerns, it would not be appropriate for me to make further findings on these issues, as they have already been addressed and responded to by this service.

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In this decision, I’ve therefore considered the remaining issues addressed in the investigator’s view issued in February 2026. The Consumer Rights Act 2015 (CRA) is relevant in this case. Under a contract to supply goods, the Act implies a term that the goods must be of satisfactory quality, fit for purpose, and as described. To be considered satisfactory, goods must meet the standard a reasonable person would consider satisfactory, taking into account the description, price, and all other relevant circumstances. In cases involving a vehicle, other relevant circumstances may include factors such as the car’s age, mileage at the time of sale, and its history. Here, Miss S acquired a used car that had covered around 84,500 miles and cost approximately £6,000. I think a reasonable person would not have the same expectations of quality as they would for a newer vehicle with lower mileage. However, it would still be reasonable to expect the car to be free from major defects and to provide trouble-free motoring for a reasonable period of time and distance. From the information provided, I’m satisfied that the car developed a fault. Although I’ve not seen expert evidence such as diagnostic reports or job cards, BMF’s system notes record that Miss S reported a head gasket issue, which made the vehicle uneconomical to repair. I’m therefore satisfied there was a fault which caused the car to break down. Having established this, I’ve considered whether the vehicle was of satisfactory quality at the point it was supplied. Given the absence of expert evidence confirming the nature or cause of the fault, I’m not persuaded it rendered the car of unsatisfactory quality at the time of supply. I’ve considered Miss S’s use of the vehicle since January 2022, which is not insignificant given its age and mileage at inception. Miss S said the fault was a head gasket failure, and while this hasn’t been independently confirmed, I recognise that head gasket issues can arise for various reasons, including maintenance practices and driver behaviour. As I’ve seen no evidence of an inherent fault, I think it’s more likely the issue arose due to in-service wear and tear. On balance, I’m therefore persuaded that the car was of satisfactory quality when supplied to Miss S. From the system notes and Miss S’s account, I recognise there was some dispute regarding the collection of the car after it was taken to a garage. Miss S said she no longer wanted the vehicle, but storage fees were incurred. BMF did not consider it was liable for these charges and liaised with the garage regarding disposal. Miss S has since confirmed that the vehicle is now at her home, although she has expressed dissatisfaction about it remaining in her possession. BMF has advised that, in order to give up the vehicle, Miss S has the option to voluntarily surrender (VS) it. Given the circumstances, I don’t consider BMF acted unfairly in this respect. Miss S continued using the vehicle and making monthly repayments for a number of years. As the vehicle remained in her possession and use, it was reasonable for her to be responsible for ongoing costs such as road tax, MOT, insurance, and maintenance. I recognise that in her email to the investigator in March 2026, Miss S said she did not realise the agreement was terminated in 2022. However, BMF’s system notes show a default notice was issued with a deadline of 5 July 2022, followed by the issue of a termination letter on 6 July 2022. Based on this evidence, I’m persuaded Miss S would have been (or ought reasonably to have been) aware that the agreement was terminated.

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Correspondence sent to Miss S shows that an option was available, at BMF’s discretion, for her to continue using the vehicle post-termination. It follows that Miss S was dissatisfied when her later request to terminate the agreement was declined. BMF explained that as the agreement had already been terminated, the available option was to VS the vehicle. Given the history of the case, and the apparent concession allowing Miss S to continue using the vehicle (which she has not disputed), I’m satisfied that VS is a reasonable option if she no longer wishes to retain liability for the car. The system notes also show that, over a period of time, a payment arrangement was put in place to allow Miss S to continue using the vehicle post-termination, taking account of any arrears. This is supported by a letter issued by BMF in July 2022, which confirmed termination of the agreement but explained that, at its discretion, a further arrangement could be made to allow Miss S to retain the vehicle. The notes also show an expectation that Miss S complete an income and expenditure assessment, and that she discussed the additional amounts she had paid over and above her standard monthly payments. Considering this, I’m persuaded that a payment arrangement—whether formal or informal— was discussed and implemented by both parties. Miss S has also raised concerns about how her data request was handled and the manner in which information was provided. Complaints about data handling are not a regulated activity. While I can consider what is fair and reasonable in individual circumstances, broader concerns about data practices are more appropriately directed to the Information Commissioner’s Office (ICO). Miss S has further raised concerns about the way BMF handled her complaint. Complaint handling itself is not a regulated activity, nor is it a specified non-regulated activity falling within our compulsory jurisdiction (DISP Rule 2.3.1R). As such, I’m unable to consider the specifics of complaint handling in this decision. Having reviewed all the information provided, I acknowledge Miss S’s strength of feeling and her wish to hand back the vehicle. However, I’m satisfied that BMF acted fairly in light of Miss S’s actions, including her continued use of the vehicle and ongoing repayments. I’m also satisfied that BMF acted reasonably by reporting accurate information to the CRAs, as required under ICO guidance. I’ve seen no definitive evidence to suggest otherwise. In the circumstances, I don’t consider it fair to require BMF to take the vehicle back, stop all repayments, or amend Miss S’s credit information. Although incorrect details were recorded on the agreement, both parties entered into an arrangement to continue the agreement alongside use of the vehicle. It’s therefore reasonable, should Miss S no longer wish to remain liable for the car, that the agreement concludes fairly, which in these circumstances would be through VS. My final decision My final decision is that I don’t uphold Miss S’s complaint about BLUE MOTOR FINANCE LIMITED. Under the rules of the Financial Ombudsman Service, I’m required to ask Miss S to accept or reject my decision before 25 May 2026. Benjamin John Ombudsman

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