Payday Loans Do's & Don'ts

Small_Loan_Turns_Big_Debt

Hello All,

I just thought I would take the time to write this so anyone that is thinking of taking out a payday loan, should really THINK AGAIN on doing so. If it is the only available route to help your financial situation then it's the only answer. However there are numerous reasons why it should only be a LAST RESORT.

I have been in a very bad situation before where I had at least 8 Payday Loans at once; yes it was stupid of me, but I have learned the hard way and now I'm currently paying mine with only 2 months from paying the whole lot off!

My payday loan spiral started in 2010/11 I took a payday loan out (thinking I needed the extra cash) and in the end I didn't really need it and could of spoke directly to the company I owed money to, to sort my finances out.

It started with 1 payday loan, which I failed to repay on the repayment date due to an unexpected bill that came out of my account. I then thought stupidly I will borrow from another lender (you can see what is starting to happen). I again couldn't afford the repayment, as with interest you have to keep borrowing more and more from different lenders. Eventually I owed a debt that I couldn't pay off that involved several different lenders oweing different amounts. (the interest was even as high as 27,000%)

To to top it all off the amout I borrowed was only £1000 from different lenders. Which in the end costed me over £4000.

You may think I'm stupid, but it happens and you can't control it, once you have one you have started a virus that will slowly eat its way into your life and your bank account; it makes you feel helpless and depressed, you don't know whether you will be able to afford you rent, or feed yourself (or your family) it gets overwhelming and people have even broke down because of it. In the end I had to speak with my family about it all, and they were a rock to me and happily could afford to pay my debts off for me (which I am paying back now). Although some people aren't as lucky as me and can't get that help, so before you do take out one of these ludicrous loans, that could possibly destroy your finances then stop and think... Do I really need that money?...



However if their are no alternatives in my experience there are only a few that I would consider helpful (what I mean by helpful is that they were willing to set up repayment plans and FREEZE interest, which they are not obligated to do) they are:

Quickquid
Wonga
Pound Access
Payday UK

These were the only understanding and helpful companies, however I would not consider taking a loan out with any of them to be honest.

Ones to stay clear off:

MCO Capital (Supposed to of been shut down, but do trade under different names)
Speed Credit - Also under different names - I believe that they may even be MCO Capital. CHECK there licenced name!!!
247 MoneyBox - Interest is unbelievable!
Tooth Fairy Finance - Basically the company and people have no heart and soul and will try and take you for every penny you have got. They will send your details to a company called Northern Debt Recovery, which inevitably the one and the same company.
CFO Lending - Interest rate is extortionate!

I personally believe that payday loan companies should be made illegal, they are and always will be legalised loan sharks.

Again stop and think... Do I really need that money?...

:think:

SergeantB

Small_Loan_Turns_Big_Debt wrote: »

However if their are no alternatives in my experience there are only a few that I would consider helpful (what I mean by helpful is that they were willing to set up repayment plans and FREEZE interest, which they are not obligated to do) they are:

Quickquid
Wonga
Pound Access
Payday UK

These were the only understanding and helpful companies, however I would not consider taking a loan out with any of them to be honest.

I agree with you here. I regret ever taking out payday loans as they ruined my life for far too long.

It the past 2 days both Wonga and Quick quid have agreed to repayment plans for me. So on Friday instead of paying £1566 I will be paying £260.

I urge anyone who has a payday loan they are struggling with to try talking to the company, what harm can it do?

Small_Loan_Turns_Big_Debt

In 2010/11 they were really helpful, I fell out of work and they did do everything they could to help me; which I did find suprising considering I had borrowed the money and promised to pay it back!

There are some decent companies out there, you just need to talk to them, ignoing the debt is the worst thing to do!

All I can say is SergeantB never use TOOTH FAIRY FINANCE I had to many problems with them! Its hard to get them to set up a payment plan!

sefton

Small_Loan_Turns_Big_Debt wrote: »

In 2010/11 they were really helpful, I fell out of work and they did do everything they could to help me; which I did find suprising considering I had borrowed the money and promised to pay it back!

There are some decent companies out there, you just need to talk to them, ignoing the debt is the worst thing to do!

All I can say is SergeantB never use TOOTH FAIRY FINANCE I had to many problems with them! Its hard to get them to set up a payment plan!

I don't think there are any decent payday loan companies. It's usary pure and simple. Some are worse than others which leads people to think the others are not bad but that is not true.

Wonga may be "more understanding" but their business model is still one of lend money to sub-primes at an extortionate rate of interest and when they predictably fall behind accept a payment plan rather than not receive full payment.

Capital Finance One have seemingly taken a different view and that is to be as sneaky as possible and loan money to sub-primes who even Wonga will not touch. They know these people are almost certain to default and even if they don't default they will offer to increase a £250 loan by £100 two weeks into a one month loan. If you agree they will charge you a months interest on the £250 straight away and add the £100 to that total so two weeks later you will owe about £470 plus a whole months interest. Probably over £700 in total.

I have read so many stories on here where people end up rolling over the interest for over a year until they break and default. CFO are happy with that as they know there is a good chance that person will apply for another payday loan sometime in the future and they will rinse their account,

nonnatus

And people then wonder why the PDL companies chgarge such high interest!! Judging from the stories on here, no-one EVER manages to pay them off simply. It always seems to snowball, ending up with people changing bank accounts and arranging repayment plans. It's a wonder the PDL makes any money at all!! :cool:

thehig

I have 2 Currently, Wonga and Payday UK.

I owe Payday UK about £150(can afford full amount so I defer and pay parital balance every month, about £10 per month goes.

I pay Wonga back in full but need to re apply before the next month is up, I'm stuck in this cycle for now until my main debt is gone.

My debt free estimation is April 2013

SergeantB

thehig wrote: »

I pay Wonga back in full but need to re apply before the next month is up, I'm stuck in this cycle for now until my main debt is gone.

I owe Wonga £660 on Friday. But on Sunday I emailed them explaning my difficulty in paying and asking if I could pay £30 a month until I was able to afford more.

They came back yesterday with a 20 month payment plan of £30.12 a month. I never in my wildest dreams thought they would agree to the original offer but I am so glad I tried.

Try speaking to them, it can't hurt.

Small_Loan_Turns_Big_Debt

sefton wrote: »

I don't think there are any decent payday loan companies. It's usary pure and simple. Some are worse than others which leads people to think the others are not bad but that is not true.

Wonga may be "more understanding" but their business model is still one of lend money to sub-primes at an extortionate rate of interest and when they predictably fall behind accept a payment plan rather than not receive full payment.

Capital Finance One have seemingly taken a different view and that is to be as sneaky as possible and loan money to sub-primes who even Wonga will not touch. They know these people are almost certain to default and even if they don't default they will offer to increase a £250 loan by £100 two weeks into a one month loan. If you agree they will charge you a months interest on the £250 straight away and add the £100 to that total so two weeks later you will owe about £470 plus a whole months interest. Probably over £700 in total.

I have read so many stories on here where people end up rolling over the interest for over a year until they break and default. CFO are happy with that as they know there is a good chance that person will apply for another payday loan sometime in the future and they will rinse their account,

I agree all Payday Loan companies are terrible, I can't think of any good points to them. But for some people they are the only wat they can get credit.

People with a Fair/Poor credit file cannot get credit from anywhere else, so in this instance if it is for an emergency you have no way off getting out of, I think they can be of use.

I do believe the interest rate is extortionate and you pay far too much for a small loan, but some people have no choice.

I find any sort of credit ridiculous, secured or unsecured; but these days there are many people looking for a quick buck and this can be the only chance.

thehig

SergeantB wrote: »

I owe Wonga £660 on Friday. But on Sunday I emailed them explaning my difficulty in paying and asking if I could pay £30 a month until I was able to afford more.

They came back yesterday with a 20 month payment plan of £30.12 a month. I never in my wildest dreams thought they would agree to the original offer but I am so glad I tried.

Try speaking to them, it can't hurt.

I need the influx of cash from them, I can afford to pay them back in full on each payday.
I only need to do it another 4-5 months before extra funds clear up as my DMP will end. (an extra £407 per month

ifstar

I would be very interested to hear if anyone has actually taken one out and paid for it back in a months time. I suspect that very few people do this and will end up getting a different one evey month.

If you are thinking about taking out payday loans then STOP, look at your financial situation and do a full SOA. I bet most people could cut back on things rather than resort to these horrible loans.

How they are allowed to even operate is a mystery, they are quite clearly aimed at people in debt crisis knowing full well they will plunge them into more debt. People are taking these loans out but not dealing with the problem and spending beyond their means and continuing to do so.

[Deleted User]

All my own fault (that's no 1 of the do's! accept responsibility along with 'fess up coming close 2nd) Enough's enough I said in 2011 out of the 6 companies I dealt with only 1 lender agreed to freeze account/not charge more on a repayment plan I also paid quite a substancial amount back thanks, before ending up insolvent. (The only goodish one lost out too as allowed me to long to pay back maybe that should be one of the PDL's don't)

Sneaky is also where these companies write and say your account is frozen then wham bam, few months down the line you find it actually wasn't ! but of course it is 2012 and today the payday lenders cannot be cursed that much - majority have bank details displayed on their website to take control of paying them back so it all looks rather civillised and if someone is so stupid as to try taking another loan well, that is without it being common knowledge now how these types of lenders operate

I'll never understand debtors who go into default with these loans, quite a serious/worrying thing to do but then go on to try borrowing from further payday loan lenders !:eek: most of the times their connected/friends/operate under other names and still how many fall for it

Another point is while payday loans are this looming evil to people who REALLY can't afford them, there's credit cards and I'm not aware that they are obliged to "help" either, along with most other forms of credit - which is worse a provident loan or a payday loan?

Anybody who thinks payday loans is a soft/easy option - good luck to them I'd say - you should know what your getting yourself into - small loans (I didn't take out thousands like I've seen) but a lot of trouble comes to mind