Payday loans - discuss the MSE guide

John1993_2

barrrrr wrote: »

How dare you accuse me of being underhand...


...reason I left England. Full of people who think they're better than everyone else, unaware that they're the lowlife.

Nice, you get all angry at people saying bad things about you, then you throw in the above xenophobic bit of hatred.

We have a word for that here in the UK, hypocrisy. I suspect it's the same word where you are, actually. Maybe you should look it up.

[Deleted User]

IMO, doorstep lenders, eg. Provident, are a less bad option (I won't use the term "better option"), than PDLs.

A doorstep lender takes far smaller payments, on a weekly bases, hence you aren't skinting yourself next month, to pay this month's loan.

While the interest rates are high, you do have the option to repay early, thereby reducing the interest via an "Early Settlement Benefit"

Also, they don't have the same damaging effect, on access to mainstream borrowing.

worried48

I have used Wonga twice, each time for only five days - which makes the interest payment lower than the returned direct debit fees would have been. On both occasions it was to meet a short term cashflow problem in my husband's business. The second time, the payment returned would have been our VAT payment which would have caused further problems. One of the joys of self-employment is that you cannot know for sure what income you will have in any one month. In our case, we often know three days in advance that there will be money going into our account, because a customer has made a card payment. That still leaves three days when we may need money urgently.

Yes these loans certainly need to be used with extreme caution but I do think they have a legitimate place in the market. Or would, if they did not automatically ruin your credit rating

cazzy123

I have been struggling with payday loans for several years now, I have just been informed from Wonga that due to an admin error in 2010 they owe me £300 and interest at 8% per annum so £372 which they have put back into my account.
I have had many loans with them since that time (practically every month) and paid back at their whopping rates of interest. My argument is that as they owed me money I shouldn't have been paying the interest on my loans (and want it back). Thus if I borrowed £300 why should I have paid interest on it cos they had £300 belonging to me anyway. Plus would I have needed the loan if they had repaid me. I feel really upset by it and their answer is each loan is a different account. Does anybody know where I stand on this?

Herbalus

cazzy123 wrote: »

I have been struggling with payday loans for several years now, I have just been informed from Wonga that due to an admin error in 2010 they owe me £300 and interest at 8% per annum so £372 which they have put back into my account.
I have had many loans with them since that time (practically every month) and paid back at their whopping rates of interest. My argument is that as they owed me money I shouldn't have been paying the interest on my loans (and want it back). Thus if I borrowed £300 why should I have paid interest on it cos they had £300 belonging to me anyway. Plus would I have needed the loan if they had repaid me. I feel really upset by it and their answer is each loan is a different account. Does anybody know where I stand on this?

I would ask how, if you needed payday loans, you did not notice a missing £300!

Also, if they have informed you of their mistake (when you clearly didn't know about) and put money in your bank account (which you weren't expecting) then you are very very lucky.

If you have savings and a credit card with a bank and don't pay back the credit card, you can't use the excuse "you have my money in the savings account so I shouldn't pay you interest on the credit card". It doesn't work like that.

I would consider yourself extremely lucky to have a £372 windfall and try not to use Wonga again.

cazzy123

Well seeing as you asked in 2010 my loan was referred to a debt collector who hounded me in work etc. then Wonga asked if I wanted to repay them over 3 months which I did, as I had already paid the debt collector £300 I asked them at the time if this would be taken off my loan and was told no. Now they have realised their error and repaid albeit 3 years too late so although I am always grateful for money I do not consider myself lucky!!!

lfrank

I think this guide is pretty sensible and seeing as PDLs are out there, then they most high profile consumer money site on the UK web should be addressing them.

My own PDL experience is that I used them for the first time around July 2012, borrowing about £200. The reason I started to use them is that I had maxed out my two credit cards (12k and 2K) over the course of the 12 months previous to that. The reason I did that is because I was a cocaine addict, which cost me somewhere in the region of £800 - £1000 a month to finance. I earn decent money (48k), and have an additional income stream from a sports website I run which brings in about £200 per month.

I maxed out my cards by drawing cash to pay for drugs, then said I would stop using. Continued to use and then had to get extra income from somewhere as my salary would not cover my drug expenses on top of my normal expenses, this was when the PDLs started. I built up to owing £1000 quite quickly, took a payment holiday on the mortgage to pay that off, told myself I would stop using, continued to use, ran up the PDLs again, took another payment holiday to clear them and so it went on... Until 2 months ago when I finally realised that I could not stop using cocaine alone, I was addicted and had no control, and so went to Cocaine Anonymous. I have been clean and sober since then and am rebuilding my life and finances.

I only share this personal story in case anyone on here is masking the real reason they are using PDLs, i.e. to purchase a substance they are addicted to. PDLs in my experience facilitate addiction and allow the addict a way of continuing to use beyond the normal point where rock bottom would be hit - at least financially speaking. They do not check any spending habits, they do not ask why a person like me would need £1000 (40% of my take home pay) in one month, they simply give you the money as they know they can take it off you when you are next paid. I don't blame the PDL companies for my predicament, I was the addict and I borrowed the money, but I hope if anyone here relates to my story and are in a similar boat they can heed this warning:

Get help for your addiction now; compounding it with owing more money and convincing yourself that you will stop tomorrow and sort it out is going to fail. You WILL use drugs or whatever you're addicted to again; you WILL borrow more money and you WILL end up in a deeper hole.

KittyBoo_2

I know this might sound a bit odd but my son has been borrowing from Wonga for a long time.
I assume he is a typical customer, who start with a small loan and then increase it until paying nearly all their wages to them.
He received a text from them yesterday but it didn't have a message.
He paid them £600 today:eek::eek: and went to borrow some more :eek::eek: but they turned him down.
He says he always pays on time but they said they were not willing to lend him anymore.
Is there a limited time/amount they will lend?
He can't pay his direct debits/rent etc and has now got no money at all.
It seems he paid them in full and they just stopped the loan extension.
I know this is probably going to be a good thing but I know he is paying the Inland Revenue a lump sum each month off a tax bill and I'm worried what will happen if he can't pay that.
Hopefully this will be the lesson he needs about the hook of pay day loans.

matttye

KittyBoo wrote: »

I know this might sound a bit odd but my son has been borrowing from Wonga for a long time.
I assume he is a typical customer, who start with a small loan and then increase it until paying nearly all their wages to them.
He received a text from them yesterday but it didn't have a message.
He paid them £600 today:eek::eek: and went to borrow some more :eek::eek: but they turned him down.
He says he always pays on time but they said they were not willing to lend him anymore.
Is there a limited time/amount they will lend?
He can't pay his direct debits/rent etc and has now got no money at all.
It seems he paid them in full and they just stopped the loan extension.
I know this is probably going to be a good thing but I know he is paying the Inland Revenue a lump sum each month off a tax bill and I'm worried what will happen if he can't pay that.
Hopefully this will be the lesson he needs about the hook of pay day loans.

It almost looks like they're being responsible lenders for a change.

Nah, can't be. :rotfl:

marilyna

KittyBoo wrote: »

I know this might sound a bit odd but my son has been borrowing from Wonga for a long time.
I assume he is a typical customer, who start with a small loan and then increase it until paying nearly all their wages to them.
He received a text from them yesterday but it didn't have a message.
He paid them £600 today:eek::eek: and went to borrow some more :eek::eek: but they turned him down.
He says he always pays on time but they said they were not willing to lend him anymore.
Is there a limited time/amount they will lend?
He can't pay his direct debits/rent etc and has now got no money at all.
It seems he paid them in full and they just stopped the loan extension.
I know this is probably going to be a good thing but I know he is paying the Inland Revenue a lump sum each month off a tax bill and I'm worried what will happen if he can't pay that.
Hopefully this will be the lesson he needs about the hook of pay day loans.

They have changed the way they operate with the new regulations, responsible lending as Mattye says.