Trapped in Wonga

t1mmy

First, I accept responsibility for this debt and have every intention to pay it back, but its also true that it feels like I'm trapped because of interest & fees. I originally borrowed £200 but now it has absolutely exploded.

Almost a year ago I borrowed £200 for 30 days from Wonga. When the debt was due, I admit I should have paid down more of it, but it was around the holidays and I was sort of short of cash, and they had just taken more from my paycheck, so I re-borrowed £250 for 60 days. This was a really bad idea because it started me on a cycle of really big debts that there is no way I could pay back at once. They wanted more than £400 after 60 days, and I tried cutting it down to £200 and paying £200+ out of pocket, but it wasn't going to work, I ended up topping it off twice once for £50 and once for £100, by the end of the 45 days I owed more than £500. The next time, I owed more than £700, and I found that they had even reduced the time I could borrow back to 30 days which made it even harder to pay.

Finally in June I ran into an even bigger problem as the amount they had charged my account for was greater my entire paycheck, so my entire bank account was drained and they hit me with a late fee. They let me extend since I had paid more than interest + fees, but since my bank account was seriously negative what other choice did I have but to take out another "top-off" just to get me through the next 2 weeks?

So what do I do now? Since June my Wonga balance has been £912 and some change. I either have to extend it for another month for more than £275, or let it charge, get a late fee of £30, let my balance go negative, and end up having to top off making my balance bigger than it was in the first place. Is there any way out of this hole? I have already paid off my original £200 loan in more than quadruple. I don't even have a problem paying off the £912 if they would just give me time to do it, its the insane fees on top of everything they charge me with that has me stuck.

Tixy

Hi

To get out of this mess you really need to default on your repayments, and then work on setting up a repayment plan.

To do this the first thing is to cancel the CPA (continuos payment authority) with you bank so that Wonga can no longer take money directly from your account. Once you have done that then you will be in a much better position to negotiate a repayment plan.

You can either negotiate that yourself with Wonga, or talk to one of the debt advice charities.

Realistically how much could you afford to repay a month? e.g. could you afford to pay over 6months perhaps?

Useful reading here - https://forums.moneysavingexpert.com/discussion/4713607 and http://www.nationaldebtline.co.uk/england_wales/factsheet.php?page=41_payday_loans

Wonga have signed up to the Good Practice Customer Charter for payday loans - see their own site here http://www.wonga.com/money/downloads/pd&stl_charter.pdf
Key quotes

If you are having problems
repaying your loan, we will:
> Deal with cases of financial difficulty
sympathetically and positively and do what
we can to help you manage what you owe.
> Freeze interest and charges if you make
repayments under a reasonable repayment plan
or after a maximum of 60 days of non-payment.
> Tell you about free and independent debtcounselling
organisations who can also help you.

*Foolish*

Wonga will set up a repayment plan, it can be done through your account on their website, however sometimes their figure is unrealistic. The advice for Tixy is spot on and I would follow that.

retepetsir

As Tixy says, set up a payment plan. You'd had this loan for over a year now? You really should have tried to set one up asap!

uberfrugal

Adding onto what Tixy has said I've found a potential problem; that is you cannot remove the CPA until you have paid off the loan:

Once you’ve repaid your loan, you can also delete your card details by logging into the ‘my account’ area of our site. You can have up to 2 cards registered to your account. If, by removing your card details, there are no card details left on your account, you’re effectively cancelling the continuous payment authority set up on your account. This means your loan repayments will no longer be automatically deducted from your debit card. You’ll have to find another way to repay to avoid any missed payment charges.

dinky201

give this a good read too http://www.actcredit.com/OFT-Debt-Collection-Guidance.pdf

see if they broke rules

eg... unresonable charges, unrealistic demands when they aint even looked income etc....

happycamel_2

über frugal, as it says, you'll have to find another way to pay. That way is negotiating a repayment plan. It'll trash OPs credit rating but that's the least of their worries at this point.

fermi

dinky201 wrote: »

give this a good read too ***link removed***

see if they broke rules

eg... unresonable charges, unrealistic demands when they aint even looked income etc....

Hi. If you want to link to the OFT guidelines, can you please link to the Official copies on the OFT site or the one here.

3rd party sites hosting copies are not always up to date.

Thanks.

Official: http://www.oft.gov.uk/about-the-oft/legal-powers/legal/cca/debt-collection

Here: https://forums.moneysavingexpert.com/discussion/3558031

eyeopener2

uberfrugal wrote: »

Adding onto what Tixy has said I've found a potential problem; that is you cannot remove the CPA until you have paid off the loan:

Sorry, but you cancel the cpa so they can no longer dictate what you pay or, as they did with me, clear your an account.

Tixy' s advice is sound and will work. You have to be a tough with them as they are with you.

Good luck.

E2

Tixy

Just to reiterate - you contact the bank to cancel the CPA, not Wonga.

The bank have to agree to this - as per the links in post #2

t1mmy

I am not quite sure what CPA is, is this have to do with accepting payment from wonga? Don't worry, I'm not going to borrow any more. I just want help with getting out of the debt I already have.

I already have been paying the full £200 required per month that is not the problem. I mean obviously I am stretching myself thin making the payments but the problem is that the payment is just extending the loan, not actually reducing the balance. I can keep up £200 payments for a few months, but another one is due soon for September and this one I don't think I can make, so the balance will grow. What I need is to get a way for them to stop or at least lower the fees so that the £200 will actually go to reducing the money I'm paying interest ON.