Martin Lewis reveals how thousands of Satsuma and Provident borrowers could see their debts wiped out after Christmas

MARTIN Lewis’ MoneySavingExpert has revealed how thousands of borrowers could see their debts wiped out after Christmas.

Those who have taken out payday loans and borrowed money through home loans with Provident or Satsuma will have had their debts forgiven by the end of the year.

This is a welcome clean slate for many who will have splurged during the holiday season, and generally find January to be a tough month with various bills and direct debits lined up and looming.

Provident and Satsuma used to help struggling Britons by providing short-term, guarantor and home loans with interest up to 1,557.7% APR in some cases.

They offered loans ranging from a minimum of £100 to a maximum of £1,000.

But after being hit by claims of mis-selling for badly issued loans, the providers will shut down for good at the end of the year.

Martin Lewis called the loans “wrong conceptin the MoneySavingExpert guide, warning that many borrowers would find themselves on a slippery slope and taking on more debt.

The money experts on The Martin Lewis Savings Team reminded borrowers that they can still submit claims for these mis-sold loans, but it’s a race against time before providers are shut down for good.

Provident announced in May this year that it was closing its home loans after nearly 150 years in business with Satsuma, shutting down the company’s online payday loan operations.

Since then, he hasn’t taken on new clients, but anyone with an existing loan still had to make repayments.

But now Martin Lewis’ team of experts has reminded Provident and Satsuma customers with outstanding loans that they won’t have to repay the money they owe.

If you still owe money on your loan, the amount will be reset to zero by December 31.

This also means that the loan will appear as partially settled on that date as well.

So any payments you make after New Year’s Eve will simply bounce back and be refunded to you.

The MoneySavingExpert team advised to cancel direct debits scheduled after this date, in case of problems.

It’s a different story if your loan was sold to another company because you fell behind – you still owe money and MUST continue to make repayments, so keep that in mind so you don’t get out of it.

How do I claim a badly sold loan, and how long do I have?

Anyone who took out a loan from Provident or Satsuma between April 6, 2007 and December 17, 2020 could be eligible to claim a mis-sold loan from the providers.

But the deadline for filing complaints is February 28 next year, which seems a long way off, but it’s only two months away.

The MoneySavingExpert team said it’s best to file your complaint as soon as possible in case any issues arise when you submit your claim.

There could be up to 4 million customers who owe money after being mis-sold.

The amount you get back will depend on how much you borrowed in the first place and how long your loan is.

To get a refund, your loan must be deemed “unaffordable”.

Provident received most complaints due to a lack of proper affordability checks, so for many this will be the case.

A loan is only affordable if you can make the repayments while still being able to pay all your regular bills and living expenses.

But if paying off your loans meant you took on more debt, that could also be considered unaffordable.

You can register to claim online, but don’t forget to do it before the deadline.