Payday Loan for 17 year old

cosmeticjunkie

Hi,

I've just discovered that my 17 year old daughter has taken out a payday loan over the phone after being cold called on her mobile. They didn't ask for any ID and transferred the money £80 to her bank account.

She couldn't pay the money back and has been hiding the letters from the debt collector threatening baliffs etc. Some of these letters have been hand delivered and she was very scared and in a right state.

I've have very stern words with her about her actions and I hope she's learnt her lesson.

I've contacted the debt collectors and explained the situation but they say she took the loan fraudulantly and owes the money, however on one of the letters from them it shows her correct date of birth so they must have know that she was underage.

My argument is that they should never have lent money to her as she's under age but they are saying that 17 year olds can take out loans.

My question is can they enforce this debt, it's now over £300 or can I tell them to get lost.

Thanks

Clive_Woody

I believe that under 18 is still considered a minor and therefore legally they cannot enter into a credit agreement.

If she provided them with her correct DOB then I suspect that there is nothing they can do to enforce repayment of this debt. I would double check with your daughter what she told them her age was, yes they should have verified anything they were told but if they have a recording of her claiming to be 18 or older then this was a fraudulent application.

I should point out that I am not an expert (far from it) but I think they made a mistake lending to a minor. She may have had a lucky escape this time but she really needs to learn from this and never get a PD loan again or give her bank details to a cold caller.

ChopperST

I would speak to a solicitor who is versed in such matters but I would agreed at aged 17 she shouldn't have been able to access credit.

Do you have any legal cover on your home insurance that may offer assistance?

Do you believe the daughter in the cold call is the other matter?

Hezzawithkids

Here's a useful relevant CAB link:

CAB

Under the Consumer Credit Act a minor can't be taken to court for the repayment of debt (the definition of a 'minor' depends on where you live) as they can't legally be held to a contract. Someone more knowledgeable will be along in a minute but even if she did tell them over the phone that she was 18 they had every opportunity to check their facts so they shouldn't have loaned the money to her in the first place and she can't be made to pay it back. They can't even accuse her of fraud as a reason to pay up.

I'm torn between thinking your daughter has been a bit silly/gullible/foolish and needs to learn from this (I've been down the not-opening-the-letters route and never wish to go there again) and this story confirming all my fears that PDLs are scumbags for not even following the basic letter of PLUS misrepresenting the law.

sharp82

Cant believe they cold call people for payday loans!

Shocking behaviour

Herzlos

I'd also be pretty worried about her giving bank details to a cold caller; it could have been anyone.

macman

A 17 year old can take a loan, but they can't be held to any contract arising (so in practice no one would sensibly loan to a minor). Therefore the debt cannot be legally enforced.
Not that that will prevent the parasitical loan co. from attempting to collect it, or selling on the debt.

[Deleted User]

Have you checked to make sure that you she didn't provide your details as some form of guarantor? I'm not sure if that would change the legal status but may make it tricky for you.

Personally even if the loan cannot be enforced (because she's under 18) I wouldn't tell her that, explain to her that you have paid off the loan (or arranged for it to be paid) and make her pay you back over time (depending on if she earns money) and then put that money into some sort of savings account, that way she will feel the results of her actions and she'll learn to save

spacey2012

citricsquid wrote: »

Have you checked to make sure that you she didn't provide your details as some form of guarantor? I'm not sure if that would change the legal status but may make it tricky for you.

That would make the loan company the victim of a fraud, not the OP.

If she is only 17 unless she has committed some fraud or deception then all they have are nasty letters and door knockers to rely on to get the money back.

RuthnJasper

Bad luck OP.

If you DO end up having to repay the debt, I'd suggest taking it out of her pocket money/allowance (if she gets one) and/or birthday and Christmas money until you are repaid in full.

But it's not your fault OP. Your daughter is old enough to know better than to do this sort of thing and behave in such an appalling way. As others have said, however, I don't believe any contract can be enforced against a minor - and the PDL have proved that they knew your daughter was under 18.

Interesting article from The Daily Telegraph on this sort of thing from last year: http://www.telegraph.co.uk/finance/personalfinance/borrowing/loans/9606570/Wonga-faces-questions-over-borrowing-by-children.html.

Best wishes OP; hope you get it sorted soon. x

Hezzawithkids

citricsquid wrote: »

Personally even if the loan cannot be enforced (because she's under 18) I wouldn't tell her that, explain to her that you have paid off the loan (or arranged for it to be paid) and make her pay you back over time (depending on if she earns money) and then put that money into some sort of savings account, that way she will feel the results of her actions and she'll learn to save

So lie to her?? Not a good example to be setting.