Paydayloan nightmare!!!

debthelp1983

Basically after 9months off on long term sick with 6months pay I've gotten myself into a very bleak paydayloan nightmare and its snowballed beyond ALL control.
I am in a situation where I'm paying off the PDL to take out another in the same day and then extending the other one.
It is a completely horrendous situation that I cannot see the wait out off. I'm wondering if there even IS a way out of...
Not to mention I have already a personal loan that I took out years ago that has around £3k on it
I have a few credit cards which just paying min payments are totalling 390
Its overwhelming and I think I must discuss this with CAB – but I love this site and would like as many opinions as possible on this subject.

So far this is the breakdown >:


WAGES A MONTH (NET)

= £1700

Overheads A MONTH (GROSS)

500—RENT W/Bills
390--CARDS
315-- Personal loan
= 1205 which would leave me with around £500 over

HOWEVER when I ADD my PayDayLoan amounts

£1000 – QuickQuid
£1100 - Wonga

MY OVERHEADS TOTAL comes to

=£3,305

Leavin me instantly short of cash which leads to me having to take out one to pay the other and then extend one and then take out another one to pay my basic overheads. I have been in this cycle for around 6 months now with no end in sight.

NOW I have been told that claiming bankruptcy and getting a 75% off ur debt IVA does horrendous things to your credit rating and I'm moving out next year and would wish to get a mortgage not to mention a car (Even though I'm already 29 I'm eventually going to have to attempt to become an actual real life grown up hahaha) so I'm extremely reluctant to do that – but if my: ‘Rob Peter to pay Paul’ cycle continues will I eventually go bankrupt anyway so really is it my only option anyway??

I felt that this board would have people unbiased and experienced enough to offer me some impartial advice – as usually the IVA companies stand to gain from my dilemma and are currently trying to get me to commit to their schemes anyway.

Any advice appreciated,
Yours sincerely
In debt and Confused
Manc!

whatsup7

citizens advice might be a good place to start

fm123

really feel for you. hope you get it sorted. citizens advice is a good start. Also depending on why you where sick in the first place, it might be worth asking HR to see if you could get the full company sick pay. a lot of time its dependant on your line manager if you get fully company sick pay. I saw a leaflet in the citizen's advice once, which says you might be able to claim the shortfall from the job centre plus.
good luck.

DVardysShadow

debthelp1983 wrote: »

So far this is the breakdown >:


WAGES A MONTH (NET)

= £1700

Overheads A MONTH (GROSS)

500—RENT W/Bills
390--CARDS
315-- Personal loan
= 1205 which would leave me with around £500 over

HOWEVER when I ADD my PayDayLoan amounts

£1000 – QuickQuid
£1100 - Wonga

MY OVERHEADS TOTAL comes to

=£3,305

The missing information is how much interest you are paying on your 2 payday loans.

Essentially, you are running a revolving door on the payday loans, so you are borrowing £2100 each month to pay off the previous month's £2100. So leave that £2100 out of your monthly statement and tell us how much interest you are paying on the £2100. That should be what goes on top of your 1205 to give your monthly overheads total.

Once you give that information, we will be able to decide whether you are actually floating or sinking and can advise accordingly.

OneLife_OneShot

I don't know about QuickQuid but I have twice set up repayment plans with Wonga I discussed it in another thread on here, it is possible to do so with them and I have found them to be helpful about it if you explain yourself properly.

The best thing to do is ring up on the day its due around 8am before the 5pm deadline and £20 missed fee and the start of interest, say you lost your job or card or something that would seem legitimate enough and say you would like to set up a repayment plan with them to sort it out.

If you even go for £100 a month it means you won't need to take out another Wonga loan next month to keep the cycle going.

I hope this helps but I have never dealt with QuickQuid so I can't comment on them.

mel12

There are options, but most of them will affect your credit rating in some way.

1) If you have the option then borrowing from a friend or family member to pay off the payday loan (and then paying the friend off at a lower interest rate over a longer period of time) is the only way I can see you might be able to avoid any impact on your credit rating. Occasionally credit unions are also able to offer this sort of loan, so it may be worth contacting your local one to ask (find one here).

2) Otherwise, you need to look at making reduced payments to the payday loan companies. A debt management plan (DMP) is a way to do this. You would pay off all the debt but over a longer time period. This looks like a viable option as you have £500 a month to put towards the debt. One of the free debt charities

can help you arrange this (don't bother going for the companies that charge to do this as they're only doing the same thing you can get for free). Some companies will freeze or reduce interest when you are on one of these plans, but its not guaranteed. This will have an impact on your credit rating.

Here is a post about how to stop the payday loan companies taking the money you need to live on out of your account while you get things sorted (again not making payments will affect credit rating though)

plum44_2

A DMP might be the answer for you but long term you must address your over-spending issues. Until you learn to live within your means, you will never rid yourself of the cycle of debt. Don't think about buying the car and the house until you can afford them.

daveg72

It's about time payday loans and the likes were banned.

tenbob84

payday loans are a good thing if used properly

Bravehearted_2

Last thing you should be worrying about is your credit rating. It isn't decent as it stands any way.

IDoDoodles

Hi,

I've been in your position too, and with a number of payday loans companies. Over the last couple of years I've found myself in all kinds of snowballing debt trouble with them.

However, I found that by speaking directly to them (as I was reluctant to enter an officially managed DMP if I could avoid it) and stating my financial difficulties, making a "reasonable" offer of monthly repayment, I got some great results.

By calmly explaining that I was having ongoing financial troubles, that I was keen to resolve my account as soon as I was able to and meet that obligation, and offering a monthly repayment that I GENUINELY thought I could manage (no matter how small/how much you think they'll reject it), 9 times out of 10 I was able to organise a structured repayment plan, often spread over the space of a 12 or 18months.
I truly believe that, although these companies get a bad rap and despite my own strife with them, that as a service provider - no more no less - they really do usually try to help out customers if they are having real difficulties repaying.

The key really is to try to speak to the same person each time you liaise with them (if possible). Here's some tips:

- Call them and simply state that you are having difficulties repaying, and that you'd like to discuss the possibility of a repayment plan. Done.

- You'll probably speak to someone in the relevant Collection department. Remain calm at all times, reassure them that you want to get the balance cleared as soon as you can, but within your current means. It is in neither your own, nor their best interests to be agreeing to repay amounts you really cannot manage.

- If they say that they can only offer a rollover, don't worry. This is 99% of the time NOT TRUE. Don't get angry or frustrated, but calmly say that you are simply unable to do that anymore, and you need to have a realistic repayment plan set up. They may refer the matter to a manager, but you'll usually get some joy from them at this point. Keep trying.

- If/when they agree to a repayment plan, ask how long they can spread the repayments over. 6 months is pretty standard, 12 months is not unusual. Some will put something in place for 3 months with a view to discuss your situation after that point, and either continue on the same track, or adjust as necessary. It will depend how much you can afford to offer in repayment as well.

- With regards to a monthly repayment offer, please please PLEASE do not offer any amount over which you think you can HONESTLY afford, no matter how good your intentions. Take into account everything you need to be able to cater for on a monthly basis, with a little room to breathe of possible - it's worth more than you can imagine if you're not completely pushed up to breaking point, financially speaking. REMEMBER! If you break a repayment plan, these companies can start to get sticky (trust me, made that mistake unwittingly a couple of times too).

- If you have little or no income, tell them you can only offer say £10, or £5 or £1 for the next 3-4 months or so. I was able to do this as long as checked in with them to let them know if/when my income situation improved. I think it went on for about 6 months before I could up the repayment, but at least then both they and I knew I was 100% able to do so.

- MOST IMPORTANTLY - ASK THEM TO FREEZE ALL FURTHER INTEREST AND CHARGES! It's not an unreasonable request, and they'll usually just do it without any hassle. It's worth sometimes asking them to actually REMOVE a recent amount of charges you may have just received as well. Sounds cheeky, but they're sometimes willing to do this as well, to a degree. If not, just ensure they're not adding ANYTHING MORE to your balance for the duration of your repayment plan.

- Don't be afraid and stay in touch with them. They really do appreciate hearing from you, whether checking a balance remaining, or speaking about the payments if you have a question. From a Collections point of view, it's nice to know that a debtor hasn't run away, and really wants to fix any problems they have. Trust counts for more than you'd expect. They're usually willing and able to help, but last-minute requests are harder to do, from a payments collection p.o.v, so give some notice.

- If you find yourself with any kind of miracle lump-sum later down the line, ask how much THEY could offer YOU as a reduced settlement figure. From my experience, the level seems to hover around the 30% - 60% mark on the original balance, but it does vary. There's no harm in asking ahead of time either "just in case". Then you can gauge how far you might have to go if you find yourself with that ability. If they ask for a figure you had in mind, be a bit cheeky. It can work wonders. Worst case? They still offer a lower figure than you owe, or meet you halfway.



More than anything, please try not to worry too much. I know it's nigh on impossible, and sounds stupid to say, but having been there myself more than I'd like I can honestly say that my own worrying was worse than any aspect of managing my debts. Try to believe that these companies actually want to help you out as much as they can, and you'll find a way through it.

Keep smiling, and speak to people on these boards for support and advice when you need it. This is actually my first post, I've been a long-time lurker, but your problem rung so many familiar bells with me.
I hope you might find my own experiences and advice useful too.

I myself am now all but £54 clear of nearly £4k's worth of payday loan hell through polite, personal and reasonable management/repayments. It can be done

Best of luck.