Sanity check ... is this right??

FattyBettyBoo

I've just found out my boyfriend has acted as a guarantor for a payday loan for a girl at his work. The idiot thought that his signature just confirmed he knew her, and he had no idea that he was ultimately responsible for the repayments (the fact that the money went into and repayments come out of his bank account weren't a clue apparently).

He has only confessed now as the girl has gone off on the sick and he's getting worried about the repayments. he says they are 5 months into it and she has paid each month so far. He has been paying it and she has had a DD going into his account to cover it. She cancelled the DD last week but has made a repayment today, so it looks like she does still intend paying it at this stage.

The problem is the the loan is with FLM quick for £500 and the repayments are £53 a month - is it me or does this not even cover the interest? I worked out that the payments need to be £82 to ever pay it off. is this correct?

Thanks for your help ...

DCFC79

FattyBettyBoo wrote: »

I've just found out my boyfriend has acted as a guarantor for a payday loan for a girl at his work. The idiot thought that his signature just confirmed he knew her, and he had no idea that he was ultimately responsible for the repayments (the fact that the money went into and repayments come out of his bank account weren't a clue apparently).

He has only confessed now as the girl has gone off on the sick and he's getting worried about the repayments. he says they are 5 months into it and she has paid each month so far. He has been paying it and she has had a DD going into his account to cover it. She cancelled the DD last week but has made a repayment today, so it looks like she does still intend paying it at this stage.

The problem is the the loan is with FLM quick for £500 and the repayments are £53 a month - is it me or does this not even cover the interest? I worked out that the payments need to be £82 to ever pay it off. is this correct?

Thanks for your help ...

Have you told him what a plonker he is ?

FattyBettyBoo

Yes, but using much more colourful language!

Georgia_Pa

My last loan repayments are going out on this pay day and what is left will not suffice for the rest of my month but I have decided I need to get out of these pay day loans!

They are a big black hole, and its a vicious circle, once you pop you cannot stop.

After my car/insurance/rent/phone/loan1/loan2/house carpet cleaning, I will only have £20 roughly. Yup, I will have to make it.

I cannot understand how your boyfriend agreed to this when it wasnt even his loan in the first place! Such a big worry in your mind, and he did it for someone else :-p

It's a bit silly, but shows he has big heart if he fell sorry for her. Bless him.

That will show him I guess...!

InsideInsurance

According to their site the interest in month 1 would have been £48.70 (assuming a 31 day month) and so the "repayments" of £53.30 (according to their site) will be covering the interest but making almost no contribution to the capital

FattyBettyBoo

He has a reasonable credit rating so I suggested he gets a normal bank loan to pay it off. With his bank he can get £500 over 12 months for less than £50 a month so its a win-win situation for him and for her.

He said he is reluctant to do this as he feels that then it is his debt not hers, at which point I gave up and just started banging my head against the wall instead as there seemed more point

sandraroffey

if they have HIS bank account details, and the payments are coming out of HIS bank, that isnt being a guarantor?????

has he taken out a loan in HIS name, for HER?????

either way, what a doughnut!!!!!!!!!!

tell_it_how_it_is

I have to be honest and confess I find it odd that your boyfriend has helped another girl, and said nothing about it until he felt he had to. If my missus had done the same for a bloke at her work, it'd make me think - but that might be just me! Sorry.

Anyway, further to your last post, methinks it WOULD indeed probably be best, and cheapest, for him to pay it off quickly now (it is already his debt too), and get the money back from her as fast as he can. And don't do anything as crazy as that again!

FattyBettyBoo

I have to be honest and confess I find it odd that your boyfriend has helped another girl, and said nothing about it until he felt he had to. If my missus had done the same for a bloke at her work, it'd make me think - but that might be just me! Sorry

If he had know what a guarantor was I would be suspicious, but given that he thought he was just vouching for her (i.e. that she worked at the company, had done for so long, and what she earned) I don't think there is anything fishy going on.

malkyh

FattyBettyBoo wrote: »

He has a reasonable credit rating so I suggested he gets a normal bank loan to pay it off. With his bank he can get £500 over 12 months for less than £50 a month so its a win-win situation for him and for her.

He said he is reluctant to do this as he feels that then it is his debt not hers, at which point I gave up and just started banging my head against the wall instead as there seemed more point

If the payments are coming out of his account, then surely it is his debt already. Are you sure he hasn't taken the loan in his name from the start and she is paying him back?

JimmyTheWig

sandraroffey wrote: »

if they have HIS bank account details, and the payments are coming out of HIS bank, that isnt being a guarantor?????

has he taken out a loan in HIS name, for HER?????

According to the website, they pay the money into the guarantor's account. They only collect the money from the guarantor if the person in question doesn't pay.
It seems like she hasn't been paying, but paying him instead.

Reading between the lines it seems like it is actually the guarantor that they are lending to.
Non-sub-prime lending at sub-prime rates. Good plan!