Avoid pay day loans!

davec1960

UsetheFORCE wrote: »

A lender should assess risk properly and lend accordingly....

I would have thought that they already do this, as shown by the rates of interest they charge.

The suggestions would result in less people being able to borrow. This may on the face of it seem to be a good thing, certainly in my case being refused a consolidation loan was in hindsight the best thing that could have happened to me as it forced me to sort out my debt problems.

However some people will end up borrowing from the non-regulated sharks who will move in to fill the gap in the market.

The other result would be that the loan companies would adapt.
We could see a rise in guarantor loans, posts appear on here regularly about the problems they cause.
Interest rates could rise, but other "admin" fees could be introduced with the sole aim of making more money from a smaller customer base.
The people who would suffer could be the people who have used payday loans responsibly.

Don't believe it could happen? Look at credit cards, penalty charges were limited so CC companies increased interest rates.
Bank charges, again penalty charges were limited so banks came up with daily overdraft fees.

Perhaps the answer lies in education, both in understanding the costs and consequences of expensive credit and also in budgeting and living within your means

Apples2

Maybe they won't send as many emails now that people are raising awareness of their name through internet forums.

Apples2

UsetheFORCE wrote: »

Stop using Continuous Payment Authority's to collect payment..why do other companies not use them???

You seem to think PDL companies are the only ones doing this.

My Mobile contract changes each month (unless I don't exceed my allowance), EON change my monthly fees at a whim after "ensuring I am on the most efficient tariff", my car insurance is renewed automatically taking a completely different figure to the previous year unless I opt out.

a CPA is much more common than you think it is.

Introduction

A Continuous Payment Authority (CPA) authorises a business to withdraw sums from a customer's account without having to seek repeat authorisation for each payment. [see note 1] CPAs are often used to collect payments for the purchase of goods and services such as vehicle breakdown services, insurance policies, broadband and mobile phone services and magazine subscriptions.

http://www.oft.gov.uk/business-advice/treating-customers-fairly/cpa-principles/#.UN10j3ccTqU

UsetheFORCE wrote: »

A lender should assess risk properly and lend accordingly....

It could be argued that they already do precisely this.

If the risk is low, the applicant is accepted by a mainstream lender and offered a rate which is better than their competitors (they WANT his business)

If the risk is high, decline the applicant. The only people who will take on the risk will charge the earth for it and will be well versed in chasing up the "take it and leg it" brigade.

jobdone1

Apples2 wrote: »

Maybe they won't send as many emails now that people are raising awareness of their name through internet forums.

Thank you MARA69 clearly thinks i want to advertise.

I am sick of the adverts on t.v, the spam emails etc.

I would love to see some hard action taken on this but it just seems that nothing is being done.

If you need cash before payday 9 times out of 10 this would be because you are not budgeting correctly and you are living out side of your means.

We all have to adjust our finances regularly because of above inflation increases. Payday loans are not the answer.

Brains64

jobdone1 wrote: »

My point is the shock at how many more of these sharks that are coming to the market. Surely something should be done to try and stem the flow.

This country is in enough s**t financially that's going to affect the next generation because of the culture that people have got used to of live for today don't care about tomorrow.

The market is saturated and what's worse, I bet this "Busy Bees" lot are not even real lenders, I bet their one of those brokers fronting up as a lender, then if you give your details presuming they will make the decision they then search out a lender for you which has no connection with "Busy Bees" apart from them getting a commission from the lender out of finding you for them, I've never used them but they sound like other brokers that I have used in the past, brokers are fine so long as they don't charge, then it's a micky take, especially when you desperately need a loan and the last thing you need is to be dishing out more money.

UsetheFORCE

davec1960 wrote: »

Perhaps the answer lies in education, both in understanding the costs and consequences of expensive credit and also in budgeting and living within your means

Indeed but it clearly would help if lenders don't lend to people who are likely by their record/situation to be getting them into an even worse position.

Apples2

I like the picture of their happy customers on their homepage

Meet Julie

Julie over-stretched herself one month and was left with little cash to see her through to next pay day. After quickly applying online, she was accepted by one of our trusted payday loan lenders for a £500 loan and funds were transferred online without the need to post back any documents. Julie repaid £625 when she was next paid.

Julie looks remarkably like the Happy Woman here:
http://www.istockphoto.com/stock-photo-6039301-happy-woman.php

Also remarkably similar to this Genital Hiatus woman here
http://healthewoman.org/2008/11/11/the-genital-hiatus-what-is-it-and-why-should-you-care/comment-page-1/

They put glasses on here here


Julie advertises her Fasion Hairstyle here
http://happynappyhead.blogspot.co.uk/2011/10/easy-hairstyles-02.html

Even Rob the other satisfied customer from the homepage seems to have a little German about him
http://www.experto.de/b2b/Marketing/online-marketing/social-networking/facebook-profilbild-optimal-auswaehlen.html

UsetheFORCE

Apples2 wrote: »

It could be argued that they already do precisely this.

If the risk is low, the applicant is accepted by a mainstream lender and offered a rate which is better than their competitors (they WANT his business)

If the risk is high, decline the applicant. The only people who will take on the risk will charge the earth for it and will be well versed in chasing up the "take it and leg it" brigade.

If the risk is high then they still go about reckless lending.... If someone's Credit Report shows you currently have 3 or 4 Payday Loans which you are rolling over then clearly lending another is madness. I wouldn't consider that to be a proper assessment of risk...

opinions4u

UsetheFORCE wrote: »

If the risk is high then they still go about reckless lending.... If someone's Credit Report shows you currently have 3 or 4 Payday Loans which you are rolling over then clearly lending another is madness. I wouldn't consider that to be a proper assessment of risk...

If I lend £200 to 10 people who promise to repay £260 a fortnight later, and at least 8 of them do, I make a profit.

Any assessment of risk by a lender is on the basis of "will this subset of customers make me a profit?" - PDL companies make money out of rollovers. They have assessed the risk. Just because 10% to 20% ail to repay doesn't mean the risk hasn't been assessed.

jobdone1

Well apples2 so very quick and good research, How can they get away with claiming that this Julie is a real borrower when its clear its a lie. Or am i missing something hear.