Pay Day Lending - is it ever ok?

gingeralan

Pay day loans are not good. I see the potential argument that they are good for one off situations but I know very few people who use them this way. Don't use PDL's ever. Not good not clever. If the boiler goes and you can't afford it wear another layer until you are in a position to pay for it yourself. No justification to use them save up and have an easy access emergency fund for these emergencies.

Peelerfart

gingeralan wrote: »

If the boiler goes and you can't afford it wear another layer until you are in a position to pay for it yourself. No justification to use them save up and have an easy access emergency fund for these emergencies.

If there was just me, then yes you are correct and that is what I would do.

Mrs PF on the other hand would want the effin boiler fixed

OK yeah we have savings.some don't,and more importanty some with no savings have small children.

crisis loans,sure if offered,but under some circumstances ...would you take the w4nga option??

Person_one

dealer_wins wrote: »

Its a shame that more people dont have an emergency savings fund to cover lifes unexpected expenses.

My parents always told me to put away 10% of my net income into an instant access account to cover any sudden expenses.

And if I couldnt afford to put away 10% I was living beyond my means and should adjust my lifestyle accordingly.

Best advise I ever had, and stick to it to this day 25 yrs on, and I would recommend it to everyone!!

10% of my net income is £88.

That has the dual problems of being a pretty big chunk of a small income but not very much in a savings account, only about £1000 if you don't touch it for a full year.

Saving is great, i do it as much as I can and I'm lucky to have low outgoings, but not everybody has enough to cover every rainy day that might come along.

endora

Dabooka wrote: »

It was a cheeky tongue-in-cheek comment about the "unforeseen circumstance" brigade who don't appreciate that car tax is an annual event, or the 23yr old Baxi was going to conk out one day!

I look forward to the day we genuinely get "I needed to replace my iPad so I went to Wonga" thread. Or did I miss one already?!

Whilst I agree that PDLs should be avoided like the plague (and I have never ever had a PDL), there's a big banner at the top of the debt forum saying it's intended for HELP NOT JUDGMENT!

Posters come here looking for SUPPORT AND SUGGESTIONS. Once they are in trouble with Wonga, QQ or whoever, it makes no difference whether they took out the loan to keep their seriously ill newborn warm or to buy a new gadget. What they need is help and useful tips to deal with the lenders, not judgment. Many people come here because they don't want to tell their partners, parents, children, siblings or best mates about it. They don't come here to be judged. We all have our reasons to do what we do, this is not a moral discussion forum, it's a HELP forum!

Johntea

As someone who got into £6,000 worth of debt with them by the age of 23 - 1p or £1,000,000 I wouldn't ever dream of touching them again!

I admit my story is maybe slightly different to a lot of people. I was a gambling addict and these were just 'another way to feed my addiction'.

But the principle is the same. Visit Lender X, apply for £400, end up getting £200 as you're a new customer. Not too much of a problem to pay off, you get paid in under a week so it is just a small loan so you can have a night out with your mates instead of being a party pooper.

Before you know it, they're allowing you to apply for up to £1500 in a few clicks, and can't pay it back on payday? No problem! You can just roll it over until the next pay day. Oh look, I can do that again!

Then I've found Lender Y. Surely they'll see I've got a £1500 loan out with Lender X and have had it for quite a while now just 'rolling it over'. Maybe they have, but they're still going to offer me some money anyway!

Rinse and repeat until you get yourself in a VERY bad mess.

How did people survive before the advent of the Internet and Payday Loans? It doesn't really matter. But they did.

In the 7 months since admitting all to my parents, I've managed to surrender control of my wages to them for 2012, so they give me money for going out etc. In that time, I've managed to clear 2 credit cards, pay them off monthly for the £6,000 that they used to clear the PDL companies for me (So I'll have repaid them by the end of the year), given in the gambling apart from a couple of very minor slips, saved up for a new iPhone, had just a good social life as I had before (in fact, probably better!) and been able to sleep at night.

My parents also came to the conclusion that the only loan needed in life is a mortgage. Any others and you're living beyond your means and need to find out why.

KingElvis

The problem with all these grotty loans is the stain they leave on your credit history, it's like buying a new car a finding a human turd in the boot.

I suppppose though that as they're aimed at the financially baffled, the fact they appear on their credit history is not an issue.

I would just steer clear, do without, make do or save.

debtcutter

Credit unions are always used as an argument for an alternative to paday loans, but don't you have to save for ages before you can borrow with credit unions>?

Not much use if you're a low income, single parent family who's boiler and oven both broke in the same month.

Dabooka

endora wrote: »

Whilst I agree that PDLs should be avoided like the plague (and I have never ever had a PDL), there's a big banner at the top of the debt forum saying it's intended for HELP NOT JUDGMENT!

Posters come here looking for SUPPORT AND SUGGESTIONS. Once they are in trouble with Wonga, QQ or whoever, it makes no difference whether they took out the loan to keep their seriously ill newborn warm or to buy a new gadget. What they need is help and useful tips to deal with the lenders, not judgment. Many people come here because they don't want to tell their partners, parents, children, siblings or best mates about it. They don't come here to be judged. We all have our reasons to do what we do, this is not a moral discussion forum, it's a HELP forum!

Of course you are right Endora, however this thread is regarding the bigger debate of pay day loans. At no point can I see anyone on this thread being judged, can you?

And I'm sorry to disagree with you about making " no difference whether they took out the loan to keep their seriously ill newborn warm or to buy a new gadget"; it makes a HUGE difference. The former would be signposted to potentially more relevant help other than PDL, the latter would be told to stop being a numpty and not get into debt over a shiney thing.

To rationale that advice on financial matters should not be judgmental is a joke. I believe the kind of advice received by posters wishing to pay for their first years car insurance etc on a PDL or loan are being done a disservice by not having the implications of their actions made clear.

Just my tuppence worth

CLAPTON

debtcutter wrote: »

Credit unions are always used as an argument for an alternative to paday loans, but don't you have to save for ages before you can borrow with credit unions>?

Not much use if you're a low income, single parent family who's boiler and oven both broke in the same month.

how are PDL any use in such a situation either?

gingeralan

Peelerfart wrote: »

If there was just me, then yes you are correct and that is what I would do.

Mrs PF on the other hand would want the effin boiler fixed

OK yeah we have savings.some don't,and more importanty some with no savings have small children.

crisis loans,sure if offered,but under some circumstances ...would you take the w4nga option??

Maybe if in this situation and your other half would rather borrow at excessive rates perhaps you should advise them it is not desirable to borrow. if you do not think you will have sufficient spare cash for such emergencies get one of those home emergency cover Insurance policies, cost less than 50 quid a year and you never have to pay the capital of any repair. 50 quid is probably less than the interest that may be due on such a loan fir this kinds of work.