Just abit of assistance!

michael001

Hello.

I have made the mistake of getting payday loan after payday loan over the last few months. I now owe over £2500 in total JUST on the 8 payday loans - ontop of that I have 2 credit cards and 2 personal loans.

Untill recently I have just about kept my head above water, having to take out a new loan every few weeks to pay the others off and pay my rent!

I have decided to do something about it - I went to my local CAB and they are preparing an income and expenditure to be sent to all of the companies.

Im going to go back in a weeks time to work out an offer of payment with CAB.

In the meantime I have been told not to talk with my creditors and to just send a very simple letter asking for my account to be frozen and saying that I am not making any futher payments untill they hear from the CAB with my offer of repayment.

Up untill now I havent missed any payments... but im abit worried about stopping paying (even though i cant pay without futher borrowing!).

Looking at the T&C's of the contracts (especially the Payday loans) they are really strict about missing payments and charge all sorts of fees and say my account 'may be passed to a Debt Collection Agency' etc etc.

Im not fusssed about my credit rating, as that is way out of the window anyway... but just dont want to end up with anything really scary like baliffs or a CCJ

Im just after abit of advise. Do I take the CAB route, STOP all payments and fingers crossed they dont pass me to a DCA and hopefully come to a manageable plan...

The CAB seem to think that that is fine and they will definately freeze the interest and we can all nicely agree a happy payment plan!!?

Im really confused - Please help. I would have thought they would just take me to court - at the end of the day I signed the contract saying I would pay the amount back..

Please could you give me your opinion on what you think this best way to go with this one is?

Lastly, I know that this is my complete own doing i'm in this mess - noone else to blame, and I do trust the CAB but a littlebit reluctant on just stopping paying alltogether untill this plan is set up. And does anyone know how the whole thing works? I'm due to go back to cab on friday. I'll keep you all updated!

Thanks so much for your time

Mike.

RAS

Mike

DID Cab recommend that you start by getting a new basic bankl account, so that the PD loan people cannot just raid your bank account?

michael001

Nope they havent actually - I didnt even think of that :eek:

As all the PDL companies have my card details AND my credit card details so they can just dip in anytime to keep trying to get some money out... But is that really bad to jsut get a basic account without giving the PDL companies my new card details? Will they charge me even more for a declined payment?

Again, I was fully aware and I know it was stupid but the interest on these things are like 3000%!

For example I owe one £250 and JUST the interest/charges Alone monthly are near £80 without even reducing the loan balance. But on the other hand I know theses are designed to be paid back in one go

I really just dont know what to do with this mess! I was fine 3 months ago!

DarkConvict

Im surprised your not owing £1000's in interest alone with so many payday loans, its not uncom to be like 100+% interest per month + charges..

You need to go into a DMP as a minimum as you can't afford it and are in debt crisis.

Post up an SOA and we'll see what your finances are like. If they are in a dire situation then bankruptcy maybe an option. http://www.makesenseofcards.com/soacalc.html

RAS

OK, so the first thing you need is a new bank account. Tomorrow.

Then you need to see if you can close the existing account, is it in credit at all, or overdrawn?

michael001

wow. So helpful... thanks guys. Ill do the SOA tonight (in about an hour and post it up here).

My bank account is with Barclays at the mo, about £3 in credit. I go to the cashpoint at midnight on payday and withdraw £300 so I have it in my hand in cash so those PDL companies cant take it out the following morning!

Thanks so much guys for your help, Ill post up my SOA ahortly..

RAS

Ok

So if possible, get a new account, then close the old one and destroy the card several days before payday.

Then you can send the letters to the PD companies and start getting it osrted.

They will bleat, loud and loads but other here have come to an accomodation in time.

michael001

Statement of Affairs and Personal Balance Sheet
Household Information
Number of adults in household........... 2
Number of children in household.........
Number of cars owned.................... 2
Monthly Income Details
Monthly income after tax................ 1000
Partners monthly income after tax....... 0
Benefits................................ 0
Other income............................ 0
Total monthly income.................... 1000
Monthly Expense Details
Mortgage................................ 0
Secured/HP loan repayments.............. 113
Rent.................................... 240
Management charge (leasehold property).. 0
Council tax............................. 45
Electricity............................. 15
Gas..................................... 10
Oil..................................... 0
Water rates............................. 30
Telephone (land line)................... 0
Mobile phone............................ 50
TV Licence.............................. 10
Satellite/Cable TV...................... 0
Internet Services....................... 11.5
Groceries etc. ......................... 85
Clothing................................ 10
Petrol/diesel........................... 200
Road tax................................ 15
Car Insurance........................... 97
Car maintenance (including MOT)......... 20
Car parking............................. 10
Other travel............................ 0
Childcare/nursery....................... 0
Other child related expenses............ 0
Medical (prescriptions, dentist etc).... 7.2
Pet insurance/vet bills................. 0
Buildings insurance..................... 0
Contents insurance...................... 0
Life assurance ......................... 0
Other insurance......................... 0
Presents (birthday, christmas etc)...... 15
Haircuts................................ 0
Entertainment........................... 0
Holiday................................. 0
Emergency fund.......................... 0
Total monthly expenses.................. 983.7

Assets
Cash.................................... 0
House value (Gross)..................... 0
Shares and bonds........................ 0
Car(s).................................. 2400
Other assets............................ 0
Total Assets............................ 2400

Secured & HP Debts
Description....................Debt......Monthly...APR
Mortgage...................... 0........(0)........0
Hire Purchase (HP) debt ...... 4500.....(113)......50
Total secured & HP debts...... 4500......-.........-
Unsecured Debts
Description....................Debt......Monthly...APR
Quick Quid (PD Loan)...........137.5.....31.7......2000
Payday UK (PD Loan)............150.......25........2000
Capital One....................480.......21........39.6
One Capital (PD Loan)..........250.......85........2000
Wonga PD Loan..................193.84....45........2000
Speed-e-Loans PD Loan..........350.......90........2000
Halifax Personal Loan..........1700......97........21
Cash Genie (PD Loan)...........197.......45........0
Payday Express.................280.......85........2000
Vanquis Visa...................285.......15........45
Total unsecured debts..........4023.34...539.7.....-

Monthly Budget Summary
Total monthly income.................... 1,000
Expenses (including HP & secured debts). 983.7
Available for debt repayments........... 16.3
Monthly UNsecured debt repayments....... 539.7
Amount short for making debt repayments. -523.4
Personal Balance Sheet Summary
Total assets (things you own)........... 2,400
Total HP & Secured debt................. -4,500
Total Unsecured debt.................... -4,023.34
Net Assets.............................. -6,123.34
Created using the SOA calculator at **********.
Reproduced on Moneysavingexpert with permission, using IE browser.

ok... heres my SOA.. On the Payday Loans, I really dont know the exact APR - all I know is that its over 2000%...

Also I have actually got 7 PD loans - I had a small one that I paid at the beginning of the month (they just took it from my debit card - I didnt even know untill I just looked at my statement online!)

My rent looks quite low I know - but I split it with my partner, same with the utilities. With the minimum payments to all of the PD loans that is just the monthly CHARGES - doesnt touch/cleear any of the actual balance.

So will the CAB just contact them all and deal with the offer of repayment?.. and what do I say in the letter to my creditors (I dont want to say anything incriminating!)

elfen

Gettting the new account is the most important thing!
Then sending the letters offering an amount of payment per month and see if they accept; DO NOT PRIORITISE OTHER DEBT; all must be paid fairly i.e. if one is for 800 and one is for 300 then you offer the bigger debt more.

michael001

ok.. What is the normal reaction from them? Are they likely to take futher action?

michael001

Right, Ive got my basic bank account sorted out now - HSBC.

Im going back to the CAB tommorow so I guess Ill just wait and see what they say!