bail on the bank ???

antony85

i have £2850 in payday loans and have finally realised i cannot afford to pay them anymore, heres who i owe to.

HTP - 400 (was 600, currently agreed to pay £25 a week and have paid back so far 200 with no interest applicable)

money shop - £750 - £112.50 interest only rollover payment

albermale & bond - £700 - £98 interest only payment

cash generator - £600 - £100 interest only payment#

cash convertor - £400 - £40 interest only payment

(all payments are per 28 days)

i have spoken to a few dmp companies who all want to rip me off and charge a set up fee, and then 17.5% each month, and cccs payplan etc (the free ones) wont help me as my debt isnt high enough.

i was however advised somewhere (cant remember where) that because all my payday loans are secured by guaranteed cheques, that i should get a new bank account and just stop paying them, and when all cheques have been to the bank, my debt will be with the bank ( i have been advised the bank wont bounce them as they are guaranteed) then once my debt is all with the bank (will take upto 1 month for all cheques to clear) to make a payment plan with the bank.

i have set up a new bank account with halifax (my old bank is natwest)

i wont be paying any of the payday loans except htp, as htp helped me out when i first turned to them about my financial dificulties, so i will continue to pay them as agreed interest free. all the others said they wouldnt help unless a cheque bounced (how will they bounce when their guaranteed ? stupid T***S - basically they dont want to know)

i also went into natwest and spoke to my advisor about it, and she advised i dont pay anything into the account and to come see her when all the cheques have cleared, she also said with my account being so far over its agreed limits (£250) it would probably be past onto their debt collecters.

so what im wondering is am i doing the right thing ? (also bit late to change as ive now missed a couple of my cheque renewal dates as of thursday, and they will come out the bank monday or tuesday!)

and has anyone ever had any dealings with natwests debt colecters?? are they reasonable??

also the most i would be able to offer the bank to pay the aproximate debt of £2,900 is £80 a month, is that appropriate?

£2,900 broken down but only at a guess

£2450 in guaranteed cheques
£250 overdraft already at its limit
£200 in charges due to be added, and incurred because each cheque will charge me £15 cos its increasin my unarranged borrowing limit, and because cheques are guaranteed (max 6 charges per period or sumfin)


any help or advice will be extremely appreciated,

antony


p.s im paid in cash (all legit) so dont have to worry about my salary still being paid into my account, and can pay it into my new account whenever i want.

firestronaut

I'm sorry, but if you can borrow money, you can pay it back. You can't just cut and run because you don't feel like paying it back.

Post a SOA and we'll see what we can do to help you make cutbacks and pay off what you owe.

You may be able to claim the charges back from the bank under the hardship claims if you're really struggling. Until then, you'll have to put up with it.

I'm sorry to sound harsh, but it's because people take money and run that interest rates are high and companies are less willing to help the people who want to pay what they owe but are struggling to do so.

DarkConvict

You should setup a new bank account and pay your salary into that one instead. Just incase hailfax tax your salary and reduce your overdraft at the same time when you pay it in.

You could let them bounce and pay the bank instead. But think hailfax charge £1 a day for an arrange overdraft and £5 for unauthorised. As your going over £250 you could well have some high charges in interest by having it all with the bank. See if you can find some credit unions in your area and talk to national debtline

antony85

-no i dont mean bail and never pay it, i mean stop paying money into my natwest let all the guaranteed cheques clear plus any charges, claim financial hardship and make an agreement to pay it back

pepe2008

Am I being thick?

If the cheques are 'guaranteed' they would NOT be guaranteed by the Bank but by the Lender.in which case the debt will be with them,no?

The only cheques 'guaranteed' by the Bank are those issued under the protection of a Cheque Guarantee Card, those presented through the clearing system under 'special clearance', or a Bankers Draft.

If you are issuing cheques that you know you dont have the funds for then that is fraud ( even if issued with a Cheque Card ).

If you've used tha Payday Loan money to buy a Bankers Dfaft then I understand, but I just dont see how you thik that the Bank are GUARANTEED to pay a cheque for which you dont have the funds and them to carry the debt??

Tixy

antony85 wrote: »

also the most i would be able to offer the bank to pay the aproximate debt of £2,900 is £80 a month, is that appropriate?

Well its not a very high amount as even if they stop charges and interest it will stick take 3years.

But whether they will accept it or not will depend on whether you can demonstrate that it is the maxmimum you can afford and also on them believing you are not spending on unnecessary luxuries.

They will expect to see a detail income & expenditure account showing your income versus your basic living costs and any secured debts and then will expect you to pay the remainder to your unsecured debts. If this is the only unsecured debt they would rightly expect it all.

How have you come up with the figure of £80?

Do you have any other unsecured debts aside from the payday loans and overdraft?

antony85

the cheques were guaranteed by a cheque guarantee card, which guarantees the shop the bank will pay the cheque no matter what as long as the cheque is no higher the the guaranteed amount, in my case, £100

and £80 is what i have worked out to be all i have left over each month, after paying basic living costs, and a secured debt of £147.50 a month.

not even left myself any money for cigs an lunch for work, ive cut everything i can in that

pepe2008

See previous post. Issuing cheques under the protection of a 'cheque guarantee card' when you know your balance or overdraft facility is/will as a consequence be insufficient can be regarded as Fraud...very risky!

Ames

But Pepe, that's how payday loans work - when he issued the cheques he was assuming his wages would be in the bank to cover them. Now he realises that that will lead to no money for living costs and so he'll have to take out the loans again. A vicious circle. Now the bank are saying to let the cheques go through without money to cover them as a way of avoiding that circle - and making the bank lots of money in charges.

That's the way I see it anyway.

A way out depends on your other circumstances, so stick up an SOA and people can see the whole picture.

pepe2008

Is it me being thick again then? If the cheques are drawn on the Posters personal Bank Account and he/she does not have a sufficient Credit Balance or Agreed Overdraft then how can anyone (other than the Bank) Guarantee the payment of the cheques.
If the poster has got themselves into a cycle of borrowing and reborrowing from Payday Loan providers then that is his/her problem, not the Banks.

DarkConvict

The OP will owe money either way, be it to the bank or to the payday company. The guaranteed cheques aren't going to ring fence any funds, they will just be paid regardless. The debt will then land with the bank if they are cashed, which may cost more or less in terms of interest and charges.