MSE News: Government in payday loan crackdown pledge

Apples2

Too many people simply cannot grasp the simple concept of borrowing eg. £200 and repaying £220 a week later.

I think some of those unable to grasp this concept play golf...in Scotland.

The false sense of security comes with offering to lend £200 at a mediocre return on the understanding the borrower will repay on time.

Maybe they charge too much for non payers - that is a different argument from bannig them altogther.

We can argue until the cows come home that the apr is not relevant to this type of lending, people will not attempt to understand the process but would rather just take the loaned money and forget all about the repayments.

The alternative is not pretty - cutting off the supply, does not cut off the demand.

ditzydanni

Hi,

I wonder if someone could help me.

i recently found out my brother who was already in about £3500 worth of debt already due to credit cards and what no. I found out last night that he had taken out 4 of this stupid payday loans and now cannot afford to pay them back and keeps rolling the months over. what happens if he dont pay the bill for these totalling about 1600 over the 4. Surely these sorts of websites should be illegal they pray on vulnerable people who cannot afford to pay for these sorts of things. Any responses would be muchly appreciated on this as i try to figure a way out of this mess.

Peelerfart

ditzydanni wrote: »

Hi,

I wonder if someone could help me.

i recently found out my brother who was already in about £3500 worth of debt already due to credit cards and what no. I found out last night that he had taken out 4 of this stupid payday loans and now cannot afford to pay them back and keeps rolling the months over. what happens if he dont pay the bill for these totalling about 1600 over the 4. Surely these sorts of websites should be illegal they pray on vulnerable people who cannot afford to pay for these sorts of things. Any responses would be muchly appreciated on this as i try to figure a way out of this mess.

Might get more of a response if you start a new thread.

You might not like the response,but you will get one.

Naf

scotlandgolfer wrote: »

The government needs to make it harder for those that are vulnerable to get access to money

Yeah, this makes sense. ?!

scotlandgolfer wrote: »

Wonga with their 4000+% interest are maybe not technically breaking the law but morally are the dregs of society feeding on misery and causing misery IMO

The interest rate is irrelevant when you're considering this. Just like it is with overdrafts these days: i.e. if you're £1 overdrawn for 20 days a month, every month you'll be charged up to £240 by your bank if its authorised, and £1200 if it's not. That's 2400% or 12,000%. Who is charging immorally now?

scotlandgolfer wrote: »

Yes folk should read the terms but the terms are laid out in a way to lull people into a false sense of security.

Hardly. Its laid out to say you borrow £100, and give us back £120 in 30 days. Seems quite straightforward and clear to me.
And to Apples here...:

Apples2 wrote: »

Too many people simply cannot grasp the simple concept of borrowing eg. £200 and repaying £220 a week later.

I've used them, and I recently paid the final £100 back. Had I not taken them I'd have had arrears on my Credit Card (charging me £12 per month over limit fees, and another £12 late payment), overdraft fees in excess of £100 per month as well as black marks and possibly defaults on my credit file. As it is it cost me up to £80 per month (vs. £120+ it doesn't sound so bad as just saying £80pm on its own) and avoided all the other nasty effects.

Its a way of getting funds in a last ditch emergency, not a way to get a quick loan to buy something you just kinda want. Problems arise only when people take it without considering if they really can pay, and the companies just aren't geared up to cope with people defaulting and not paying back in full.

geoffky

They bottled it. Not one of them has a backbone...if i had my way every mp would hang from a lamp post.

paddyrg

ditzydanni wrote: »

Hi,

I wonder if someone could help me.

i recently found out my brother who was already in about £3500 worth of debt already due to credit cards and what no. I found out last night that he had taken out 4 of this stupid payday loans and now cannot afford to pay them back and keeps rolling the months over. what happens if he dont pay the bill for these totalling about 1600 over the 4. Surely these sorts of websites should be illegal they pray on vulnerable people who cannot afford to pay for these sorts of things. Any responses would be muchly appreciated on this as i try to figure a way out of this mess.

I suggest you start a new thread for this topic, so you don't get overlooked. Your brother needs to contact CAB or CCCS (both free) who will help him manage the debt companies. And he needs to get a second job and get these paid off pronto as when he starts/continues defaulting, he will start getting court summonses, much better to deal with it head on than have a CCJ against him!