Is this a good plan (Given the circumstances!)

barmy_jimbob

Hi all

Ok so i, like many others it seems has fallen into the trap of payday loans, thus becoming dependent on them and im currently losing about £350 per month on interest alone on the ones i have out. Basically i want this to stop, How im looking at doing this is by taking out a longer term loan with a Company called pounds to pockets, basically if i borrow £700 (near as dammit enough to wipe off not only the payday debts, but the reliance on them) i will pay back £109 per month for a year, I know its an apalling rate of interest but given my apalling credit rating i dont really have alot of choice where i can go.

I earn a fairly decent wage and i can take on a repayment of £109 per month, to me it just seems a bit more logical than borrowing around £700 every month from these vultures and then paying back £1100 every month

Any thoughts or help greatly appreciated

Cheers
Jimbob

originalmiscellany

I think more info is needed:

How many debts, how much for, how long for, interest rate etc.

Is it just one debt you have?

shakespeare12

Hello,
I did exactly this about 4 months ago, because I was in the same situation as you - I ended up being dependent on a Wonga loan. I think given the circumstances it has worked out ok, though the Pounds to Pocket didn't cover my other debts so for a while I still struggled.

I'm now managing without a payday loan but only because I spoke to an independent debt advice service and they helped me to prioritize and make a 6 month plan - not exactly because I took out a 12 month loan! I reshuffled my 'top' bills and debts and realised with a bit of patience I could sort myself out.

So I would suggest speaking to someone first (I spoke to CCCS) to make sure you know all of your options, because P2P interest is extortionate and I can bet 6 months in you'll be sorry you're still paying even though you've paid off what you originally lent (like me!).

Good luck.

barmy_jimbob

originalmiscellany wrote: »

I think more info is needed:

How many debts, how much for, how long for, interest rate etc.

Is it just one debt you have?

Payday loan wise is currently have outstanding

QQ £437 (Borrowed £350)
Wonga £275 (Borrowed £170)
PDUK £412 (Borrowed £300)
PDEX £280 (Borrowed £280)

Thats what will be leaving my account on payday this month, so how my mind is working is that if i take a longer term loan with one repayment per month of £109 which i can handle a month. Obviously without that ammount of money leaving my account i can then begin tackling, the Credit Card i have (£2400), increase my DD payment up to the £150 mark...

Anything else you need to know, please ask!

Jimbob

fantastiyk

Hi,
Have you thought of trying borrowing from your local credit union to clear all the pay day loans? The interest rates are a lot lower and you can renegotiate with them if things get tough in the future.
I don't have any experience with pound to pound or any pay day companies but believe the rates are extortionate as someone else has posted above.
It would probably benefit you to put a list of all your loans and income up - perhaps completing an SOA and posting it on here - for people to give you feed back.
My debts are different to yours - cc and overdraft but there are so many on here who have been where you are that can give you great advice with the benefit of having been there and done that.
Good luck with it, you will resolve it, I've seen so many successes on here.

Jenny0050

Dear Jimbob

I'm sorry to hear of the situation you find yourself in and can sympathise with you...

A possible problem with your plan might be that, I have found from personal experience, that Quick Quid and Pounds to Pocket are actually 'sister' companies- and so you can't borrow from them both at the same time.

You will need to pay off the Quick Quid payday loan before you take one out with Pounds to Pocket.

I hope this information helps!

Best Wishes!

quantic

Generally speaking it is not advised to pay off debt with more debt, because what often happens is people then start borrowing off the original people again, thus having double the amount.

As previously suggested I would speak to someone like CCCS:

http://www.cccs.co.uk/

Benitomomo

Hi Jimbob,

Go to your local credit union with every document you have (payslips, bank statements etc).

They do not look at your credit history, but base the loan on your income and if you can make the monthly repayment.

I agree a larger longer term loan to pay off all your debts sounds sensible, but make sure you can pay this larger loan and do not ever take credit again.

I hope this helps.

billinghamfan

I borrowed from P2P to pay off my payday loans then christmas came along and I took out a payday loan now I own £4500, I would be very careful before you consider P2P.

Toomuchdebt

Why don't you try reducing the loan amount you borrow each time?In other words pay off all your payday loans as you should, then reborrow but 50 pounds less on each?then 50 less again the next month etc.OK it'll take longer but you will eventually get them paid off and won't struggle as much as if you'd tried to pay it all at once.