Guarantor Loan Refund Calculator

A successful guarantor loan affordability complaint produces redress designed to put you back in the position you would have been in if the unaffordable lending had not happened. This page explains how the redress calculation works, gives a rough estimate you can apply yourself, and shows how outcomes vary depending on whether the lender is still trading, in a Scheme of Arrangement, or in administration.

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In this guide

• What a successful guarantor refund includes
• A worked example
• Where the lender is still trading
• Where the lender is in a scheme or liquidation
• How to estimate your own refund
• When the calculation gets complicated
• Frequently asked questions
• Related guides
• Our Partner's Fees Explained
• Check If You Could Be Owed Compensation

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What a successful guarantor refund includes

For a borrower whose loan is found to have been unaffordable from the start:

• Refund of all interest and fees paid — every pound paid above the principal amount you originally borrowed is refundable.
• 8% simple statutory interest — added to each refundable payment, calculated from the date you made it to the date redress is paid.
• Removal of adverse credit-file entries — defaults, late payment markers, and the loan account itself are corrected or removed where the loan was unaffordable.
• Balance offset — if a balance is still outstanding, refundable amounts are applied against it first; any surplus is paid as cash.

For a guarantor who paid on the borrower’s behalf:

• Refund of all payments made — including 8% simple interest on each.
• Release from the guarantee — for unaffordable lending, the guarantor is no longer liable.
• Credit-file correction — entries reflecting payments under the guarantee are removed.

A worked example

Take a borrower who took out a £5,000 guarantor loan in 2017 over 60 months at 49.7% APR, repaying about £197 per month. Total amount payable was around £11,820 — interest of around £6,820. They repaid the loan in full by 2022.

• Interest paid (refundable): £6,820
• 8% simple statutory interest on each monthly payment from when made to redress date: roughly £1,500-£2,000 depending on payment timing
• Indicative redress before tax: around £8,500

Of the 8% statutory interest element only, basic-rate (20%) tax is deducted at source by the lender. Non-taxpayers and those with unused savings allowance can reclaim this from HMRC using form R40, within four years.

Where the lender is still trading

For active lenders like 1Plus1 Loans and Bamboo Limited, successful complaints produce 100% of the calculated redress. The standard route applies — complaint to the lender, eight-week response, escalation to FOS if needed.

Where the lender is in a scheme or liquidation

Several major guarantor lenders are subject to schemes that pay out only a fraction of the calculated redress:

• Amigo Loans — final payout 18.51p in the pound (12.5p initial + 6.01p second). Scheme completed 28 August 2025; Amigo Loans Ltd entered solvent liquidation September 2025. Customers who did not update bank details by 17 May 2025 had funds paid into the High Court and must apply to release them under the Trustee Act 1925.
• NSF Group (George Banco, TrustTwo, Everyday Loans) — Scheme of Arrangement court-sanctioned 22 June 2023; £14m fund; estimated 22-28% recovery. Claim deadline 31 December 2023 has now passed.
• TFS Loans (TrustTwo) — administration February 2022. FCA fine of £811,900 (June 2022) related to affordability failures. Recovery limited to administration distributions.
• Buddy Loans (Advancis Limited) — administration September 2021. No money for cash refunds; redress applied via balance adjustment on transferred loans only.

How to estimate your own refund

A simple manual estimate:

• Step 1 — Find the principal: the amount you originally borrowed.
• Step 2 — Find total paid: add up every payment you (and any guarantor) have made on the loan.
• Step 3 — Subtract: total paid minus principal = interest and fees paid (potential refund before statutory interest).
• Step 4 — Add 8% simple interest: roughly 8% per year on each payment, from the date you made it to today. A rough rule of thumb adds another 20-30% on top of step 3 for older loans.
• Step 5 — If the lender is in a scheme, multiply by the scheme’s pence-in-the-pound rate.
• Step 6 — If you have a current balance, redress is applied against it first; any surplus is cash.

When the calculation gets complicated

The simple estimate above works for a loan that was unaffordable from the start. Several situations need more careful treatment:

• Multiple loans with the same lender — top-ups and refinancing can produce overlapping refunds.
• Partial uphold — if some loans were affordable and others not, the calculation runs only on the unaffordable ones.
• Guarantor calls — where a guarantor made some payments and the borrower made others, the refund splits between them.
• Defaulted loans never repaid — different treatment depending on whether the debt has been written off, sold to a third party, or is still active.
• Tax — basic-rate tax is deducted at source on the 8% interest element only, not on the principal refund.

Frequently asked questions

Will the calculator give me an exact figure?

No — exact figures require the lender’s payment data and the application of the Financial Ombudsman’s standard methodology. The estimate is useful for deciding whether a complaint is worth pursuing.

What if I still owe a balance?

Any successful redress is applied against the outstanding balance first. Where the redress exceeds the balance, the surplus is paid as cash. Where it doesn’t, the balance is reduced (and may be written off entirely if the redress is large enough).

Can I claim 8% interest on the principal?

No — the 8% statutory interest applies only to amounts being refunded (interest, charges, payments above principal), not to the principal itself which you actually had the use of.

Related guides

• How redress is calculated
• Guarantor loans claims hub
• What if the lender has gone into administration?
• Do I have an unaffordable lending claim?
• How a claim works step by step

Check If You Could Be Owed Compensation

You may be eligible to complain if a lender gave you credit you couldn’t afford. Start a free check in minutes — no paperwork needed. No win, no fee if you choose to proceed.

Check your agreements on Recoup, our claim partner’s site