Another 20 something in payday loan trouble.

jjex22

Hi all,

I've been reading around on this for a while, but thought I'd best just ask your advice directly!

Okay first the background; My debt - around £2300 shared between quick quid, payday express and the money shop. This comes to a roll-over interest of around £450 a month (that's the interest on the debt, not paying any off)

I know I shouldn't have got into this situation, and I knew at the time of taking out the loans it wasn't ideal, but after three years in jobs that took home less than 10K, I lost my job, wasn't eligable for anything other than JSA, and had to meet my bills, obviously I had nowhere to else to get cash, so took the gamble on getting a job before the payday debt got on top of me.

The good news is I'm working again, and I now take home around twice as much as my last job. The problem is that at £450 a month in interest, I'm realistically looking at maybe being able to pay down £150 a month tops... which of course means that if anything comes up the likely hood is that I'll have to re-borrow and won't go anywhere.

So I've been looking into ways of reducing my payments to clear the debt. I originally looked into getting a loan to cover it.. this was the point at which I discovered that the payday loans were on my credit report (despite being assured by one of them that this was not the case) So word of warning to people; even though I've not missed a payment with any of them, my credit rating is back to "poor" from "fair".

I'm now looking at debt management companies... this is where I really need the advice. I've spoken to money expert who are talking about clearing the debt in 9 month payments of £330. Rgiht now I can afford this, and it does clear the debt... I'm just really apprehensive as you always hear bad things about debt management companies... plus their advice is that I stop paying my payday loans companies immediatly even though they won't actually talk to them until I pay them at the end of the month.

Obviously this worries me that I'll really be agreeing to a payment scheme PLUS my payday loans, which would go into arrears and inccur fines.

Any advice?

bankhater_1965

jjex22 wrote: »

Hi all,

I've been reading around on this for a while, but thought I'd best just ask your advice directly!

Okay first the background; My debt - around £2300 shared between quick quid, payday express and the money shop. This comes to a roll-over interest of around £450 a month (that's the interest on the debt, not paying any off)

I know I shouldn't have got into this situation, and I knew at the time of taking out the loans it wasn't ideal, but after three years in jobs that took home less than 10K, I lost my job, wasn't eligable for anything other than JSA, and had to meet my bills, obviously I had nowhere to else to get cash, so took the gamble on getting a job before the payday debt got on top of me.

The good news is I'm working again, and I now take home around twice as much as my last job. The problem is that at £450 a month in interest, I'm realistically looking at maybe being able to pay down £150 a month tops... which of course means that if anything comes up the likely hood is that I'll have to re-borrow and won't go anywhere.

So I've been looking into ways of reducing my payments to clear the debt. I originally looked into getting a loan to cover it.. this was the point at which I discovered that the payday loans were on my credit report (despite being assured by one of them that this was not the case) So word of warning to people; even though I've not missed a payment with any of them, my credit rating is back to "poor" from "fair".

I'm now looking at debt management companies... this is where I really need the advice. I've spoken to money expert who are talking about clearing the debt in 9 month payments of £330. Rgiht now I can afford this, and it does clear the debt... I'm just really apprehensive as you always hear bad things about debt management companies... plus their advice is that I stop paying my payday loans companies immediatly even though they won't actually talk to them until I pay them at the end of the month.

Obviously this worries me that I'll really be agreeing to a payment scheme PLUS my payday loans, which would go into arrears and inccur fines.

Any advice?

you are doing the right thing in thinking of a debt management plan ,do not take out any credit to pay off the debt esp with it being so small, by taking out more credit for a £2500 debt will eventually go higher , and may spiral out of control later on , tackle the debt whilst its small

jjex22

you are doing the right thing in thinking of a debt management plan ,do not take out any credit to pay off the debt esp with it being so small, by taking out more credit for a £2500 debt will eventually go higher , and may spiral out of control later on , tackle the debt whilst its small

Thanks Bankhater,

I suppose that the debt management plan does increase my debt as 9*330=2970 including money experts fees, but this isn't really the problem; at the end of the day there is very little help available for payday loan debt (after all who wants to pick up a defaulting unsecured PDL?!) and this fee seems reasonable so long as the plan works as advertised. of course if anyone knows of anything cheaper, that's great!

What I worry about is that this is all alien to me, and I've been advised by ME to report my cards and cheque book as stolen and just tell the PDL companies who will be dealing with my debt and my reference number. I haven't signed yet, and I have until monday when their courrier comes for the documents, so I just want to check I'm doing the right thing and not making another PDL kind of mistake?

simon2010

Sorry have to disagree with bank hater on his advice here.

I would recommend that you try and get a loan to clear this debt. You are paying £450 per month and going nowhere with it.

- try your bank
- try employer / friends/ family, explain that u have f'up!
- try a credit union

You need to get out of this trap of PDLs and never ever go back!!!

Good luck.

Not having a pop at you but:

£2300 shared between quick quid, payday express and the money shop. This comes to a roll-over interest of around £450 a month (that's the interest on the debt, not paying any off)

This should be illegal to be able to do this to someone. They should report to credit companies and it should be regulated that you cannot get yourself into this situation. e.g. you should have say a £300 pay day loan limit. Ok, I am in dreamland with this but the countless times we read about this..............

Good luck!!!

Tixy

If you are considering a DMP - make it a free DMP from either one of the debt advice charities or Payplan - no point paying a portion of each month's payments to a DMP provider for their fees when you can instead have it all go towards your creditors.

IMPORTANT - Where to seek professional impartial advice about your debts.

Presumably you understand that being on a DMP will seriously impact your credit file - and means you must not take on any more credit at all until the DMP is repaid.
Thats not to say its not a sensible option for you but just not something to be taken on without understanding the implications.

The other option would be to try to set up repayment plans with the payday loan companies yourself - some feel they can manage this themselves, other like help. If you do go for the DIY approach, first open a new bank account with an unconnected bank to your current account - and have your salary paid into that.
Only then when your money is safe from being raided by the pdl companies should you contact them to try to arrange repayment plans - some advice on this thread - Dealing with Payday Loan Companies

Bravehearted_2

simon2010 wrote: »

Sorry have to disagree with bank hater on his advice here.

I would recommend that you try and get a loan to clear this debt. You are paying £450 per month and going nowhere with it.

- try your bank
- try employer / friends/ family, explain that u have f'up!
- try a credit union

You need to get out of this trap of PDLs and never ever go back!!!

Good luck.

Not having a pop at you but:

£2300 shared between quick quid, payday express and the money shop. This comes to a roll-over interest of around £450 a month (that's the interest on the debt, not paying any off)

This should be illegal to be able to do this to someone. They should report to credit companies and it should be regulated that you cannot get yourself into this situation. e.g. you should have say a £300 pay day loan limit. Ok, I am in dreamland with this but the countless times we read about this..............

Good luck!!!

Dude quit with this regulation/limiting lending bull-droppings.

All these borrowers have brains, werent forced and agreed to Ts&Cs.

Your school of thought are those begging the govt to think for us. "govt regulate x and y so that I dont have to do the thinking or have accountability or responsibility"

And I bet if the pdl are forced to stop, we'll get people here moaning that the govt is forking it up for them and stopping them getting loans from all sources!

Apples2

A fee paying DMP company will take the first two complete payments for themselves, your debt will rocket for two months when none of them receive a penny.

NEVER pay for a DMP.

bouncydog1

Read the post from Tixy again and take that advice, making sure that your fully understand whichever path you decide to take.

Is there anyway that you could sell stuff to raise some funds and borrow the balance from your parents? Alternatively could you speak to your bank and explain the position you are in and why to see if they would loan you the money.

You should also post over on the debt free board to see where you can cut costs and up income over the next few months - second part time job shelf stacking, bar work etc. 9 months is not long to get yourself out of debt but you have to really knuckle down and make the effort.

LeedsLS8

I fell into the trap of PDL's a couple of years ago. Started with wonga, then quickquid, then loads of others. They were pestering me all the time. It was worse when they started calling my employers and advising them of my financial situation. It got to the point, where I got so stressed that I packed my job in. They havent contacted me for a while, but because im on benefits Im tempted to do a Debt relief order with CCCS.

DCFC79

Do you live on your own ?

Can see you have mentioned it. Could you not rent out a room to help with the repayments. Definitely dotn go for a fee paying DM company as the free ones are just as good. You don't owe that much, its only just shy of 2.5k what you owe but without knowing more of your finances I dont know if its achieveable on your salary. Maybe post a SOA on the debt free board to see where your money is going and what you can cut down on.

arcon5

jjex22 wrote: »

Hi all,

I've been reading around on this for a while, but thought I'd best just ask your advice directly!

Okay first the background; My debt - around £2300 shared between quick quid, payday express and the money shop. This comes to a roll-over interest of around £450 a month (that's the interest on the debt, not paying any off)

I know I shouldn't have got into this situation, and I knew at the time of taking out the loans it wasn't ideal, but after three years in jobs that took home less than 10K, I lost my job, wasn't eligable for anything other than JSA, and had to meet my bills, obviously I had nowhere to else to get cash, so took the gamble on getting a job before the payday debt got on top of me.

The good news is I'm working again, and I now take home around twice as much as my last job. The problem is that at £450 a month in interest, I'm realistically looking at maybe being able to pay down £150 a month tops... which of course means that if anything comes up the likely hood is that I'll have to re-borrow and won't go anywhere.

So I've been looking into ways of reducing my payments to clear the debt. I originally looked into getting a loan to cover it.. this was the point at which I discovered that the payday loans were on my credit report (despite being assured by one of them that this was not the case) So word of warning to people; even though I've not missed a payment with any of them, my credit rating is back to "poor" from "fair".

I'm now looking at debt management companies... this is where I really need the advice. I've spoken to money expert who are talking about clearing the debt in 9 month payments of £330. Rgiht now I can afford this, and it does clear the debt... I'm just really apprehensive as you always hear bad things about debt management companies... plus their advice is that I stop paying my payday loans companies immediatly even though they won't actually talk to them until I pay them at the end of the month.

Obviously this worries me that I'll really be agreeing to a payment scheme PLUS my payday loans, which would go into arrears and inccur fines.

Any advice?

When their fees start getting out of hand and disproportionate to the principle debt imo this isn't necessarily bad advice. At the end of the day they want their money and more back, after 2 or 3 missed payments they will soon get interested in helping you. Although this will further damage a credit report so not suited for everybody