Pay day loans - breaking the cycle?

OldGregg1889

Hi all

Having lived far more extravagantly than my income allows for the last 2 years i finally realised at the weekend that i need to sort my life out.

Reading other peoples stories on here has made me ashamed of myself, i've got myself in a mess basically through my own financial recklessness not through desperation as many others clearly have so i certainly don't deserve symathy but would be extremely grateful for any advice.

My biggest problem is that i've foolishly got into a rut of pay day loans. Basically each month i'm paying out most of my salarly on repayments then having to borrow days later to pay my other outgoings which costs me about 300 a month in fees that i could be using to pay off my credit cards.

I tried to get a loan of £1000 from black horse earlier that i could have used to stop the need for any more pay day loans but was refused. I've already got all the low credit profile credit cards (cap1, barclay initial, vanquis, aqua) so using a credit card isn't really an option. I'm guessing if black horse turned me down it's unlikely that anyone else will give me a loan.

Has anyone got any practical advise that would help to get me out of this money-sucking cycle? My ultimate goal is to get out of this mess and use the money pay off credit cards then to start saving up for a deposit for my first house (admittadly probably a good few years off) so if at all possible i need to do something that would have as minimal impact on my credit rating as possible.

Like i said, i've only got myself to blame for being in this situation but i'm genuinley determined to face up to it and have well and truly learnt my lesson.

Peace and love.

property.advert

I got into this but with serious credit card limits and a 6 figure annual cashflow but the principals are all the same. I'm just saying that I'm no saint.

You know the problem, its the massive interest rates on your credit card balances and then you're paying probably 25% a month on your pay day loans. It sounds as though you are past the critical point where you can't even make your monthly repayments.

If you cannot raise income, then you'll have to cut costs. No nights out, plan your shopping, only buying what is on the list and that list must be linked to what you are going to cook for the week. No mid week top up shopping and cut way back on expensive processed foods like ready meals. Not easy to do but possible. Have a look at the BBC's Economy Gastronomy for some ideas. Channel 4 have Gordon Ramsey on video and I swear, his lasagne is top class, the best I've ever made for my self. I do put extra cheese in the sauce though ! http://www.channel4.com/food/recipes/chefs/gordon-ramsay/gordon-s-lasagne-recipe_p_1.html

Obviously, cut out booze and cigarettes if you smoke (and can - not advisable when stressed).

If you are up to date with repayments, then your credit file will be poor but healthy. If you have missed payments, even by days, then you have already blotted the copybook and you might want to think about asking your creditors for time. I would have a look at your file and see where you are.

You have to stop the pay day loans. You cannot afford 25% of your salary going out (or whatever figure it is). You don't give any figures but you have to find some way to at least cut down this amount and reduce it to nil eventually.

One thing which does work is to not take cards with you and work with cash whilst limiting your ATM withdrawls.

It doesn't look like you've a simple fix but rather you'll have to cut back all over to get back to a point where you are not using pay day loans.

dougyd

Please can you post a list of what you owe and who to (payday loan wise).
I've been in the same situation and am familiar with most of them out there so feel I can advise how to handle certain companies.

WASHER

Welcome to MSE and the DFW board.

We need additional info, like an SOA (a list of incomings and outgoings) before we can offer any real advice.

Please do not try and apply for any more credit cards/loans etc, it will affect your credit rating.

The lovely peeps on this board will not judge you on your past spending, (most of us have done just what you have).

Look forward to seeing your SOA, and in the meantime take a look at the CCCS website, its a debt charity, the website has a wealth of info, it could really help you. DO NOT UNDER ANY CIRCUMSTANCES USE ANY FEE PAYING COMPANY TO HELP YOU WITH YOUR DEBTS. Others you can try are: payplan or the National Debt Line (both fee free and many peeps on this board use them).

Do you have anything you can sell on Ebay? Or at a carboot...Every little does help.

bluebag

Hi, can't offer any advice as there are far more experienced and qualified people on here to help, but I do know that feeling of 'kicking yourself'. You've taken the courage to post on here and that's a very positive thing. Time to stop being hard on yourself and allow others to help.

OldGregg1889

Big thanks to you all, I'll post a soa and details of what i owe to who later today.

OldGregg1889

right here goes then,

pay day loans i owe:(all these figures include the fees)

Payday UK (aka month end money)
£500

Quick Quid
£625

Wonga
£300

In addition Ive got credit cards as follows: Barclaycard £1250, Ulsterbank £1000, Capital 1 £500, Vanquis £500, Aqua £500. There all pretty much at the limit but i am up to date with payments.

Loans: A&L about £3300 outstading at 192.5 a month, Blackhorse £800 outstanding at £102.02 a month.

Overdraft from smile = £1000, always at that by the end of the month.

I moved back into my mum's a couple of months ago to try and save but up till now have been frittering it all. So my monthly ins and outs look at bit like this:

In: £1300-£1350 take home pay

out (i've done this without the pay day loans):

loans: 294.53

cc at minimum payments: 150

board: £250

phone: £40

petrol: £200 (this seems excessive but i have a 70 mile daily commute so is pretty unavoidable)

breakdown cover: £12

This should leave me with a bit each month to pay extra off the c.c's but like i say it's all being swallowed by the pay day loan fees.

sorry this is a bit hotch potch but i hope it's enough to go off and i genuinely am really grateful for the help.

can i also just ask, what do organisations like CCCS actually do? i've heard a few names but am unfamiliar with how they work.

tealady

Hi. Can you complete a full SOA so we can help you sort this out. You really need to know where every penny is going. These a template somewhere you can use.

property.advert

If you are paying all the cards and not missing any payments, then I'd really consider keeping that up and just get the balances down.

Very simply, you get £1300 and you are paying out £950 with the remainder going on the presumed 25% charge for pay day loans 500+625+300=1425/1.25=1140

That is effectively saying you have £150 to £200 a month spare.

OK, can you get someone to lend you £1000 for 3 months ? If so, you can bin off the pay day loans in one month. That would bring you another £300 or so to go towards paying off your debts and you should be near back to even keel after the 3 months (paying your £1000 back at £333 a month). Then you've circa £450 a month to pay down your high % cards.

LeeSouthEast

Try completing this. It's in a format we are all used to