Breaking the Wonga cycle.... help please

MorbidX

So considering I'm posting this at 3:30am you can probably guess i don't sleep much because of all this mess.

To give you a quick background about 8 years ago i knackered myself up credit wise and have spent years paying it all off and finally have no "red marks" on my credit file and slowly started to rebuild my credit history (773 at its recent peak, crap i know)

Around May/June 2013 i had some issues with a dodgy landlord and I had to move but didnt have the cash to move so foolishly turned to Wonga for a payday loan.

Skip forward and Since June 2013 to April 2014 I now owe £1496. For the last 6+ months i pay the loan off then instantly retake the loan to pay my bills and cover basic living expenses.

So essentially I'm paying the loan then retaking the loan to live off of it. Normally my income is around £1250 month after tax, this is bonus month so i can cover the £1500 just but i'll be left with about £50 and will need to retake £750 for bills and cost of living + prob £50-100 for food through the month meaning that after Wonga's amazing interest rate i owe £1200 again which is all my wage for the next payday.

If Wonga doesn't pay out for 1 month I'm screwed and cant pay any bills or feed myself or heat my home.

I've calculated i may be able pay it off by retaking the loan each month but that will take 12months to do and i will have paid them probably another £2000 for the privilege.

My credit rating is shot to pieces at 535 as i took a card out recently to rebuild my credit rating (which is at the £250 max atm).

My options i see it are as follows.

1) Pay the loan, retake it and hope i can clear it and reduce it in monthly steps but this is very risky (also make min payments to my credit card)

2) Setup a repayment arrangement with them for £200 a month which would allow me to pay my bills, clear my credit card and have some spare money

Obviously option 1 while hammering my credit file for multiple loans again each month, wont make any real difference to the damage already done

Option 2 means i will smash my credit file for the next 6 years undoing all the work i've done but I'm free of Wonga but is there any hope for me rebuilding my credit rating with 1 credit card?

The outside option is somehow getting a loan to cover wonga with a realistic payment plan but given my credit rating this is going to be impossible.

Help thoughts and suggestions please... i know this is all my own doing but I'm willing to try anything and Wonga are claiming on Thursday

sazaccount

Good Morning

I don't really know if I can help or not but dropping in to say hi before someone more knowledgeable comes along...

But do you have anything that you can sell before thurs, not used electronics, gold, I've found fb selling pages are good and able to sell items quickly for cash.

If you post up a SOA theres a link somewhere on here or on one of the other theads.

If you head over to the old style board there are very lovely people who can help with food budgeting on a very low amount.

Can you ask the bank for an overdraft, evening with the fees it may be cheaper than the wonga loan?

Finally give one of the FREE debt charities a call, stepchange, christians against poverty etc they maybe able to help and give advise over the phone.

Best of luck
xx

vics1928

Hi

I know the feeling and the cycle you are in being hard to break I would call them and explain your position and work with them to create some kind of repayment plan - consolidated loan option if you sure you won't do the same again is an option

MorbidX

Cheers for the replies guys. I dont have anything of value sadly to flog for extra cash and with my credit rating an overdraft or any form of proper credit is going to be impossible to get.

Realistically without paying Wonga each month and after all bills but minus food expense I should have £500 spare each month but because i'm in this hole with Wonga its all in and all out.

I'm inches from setting up an arrnagement for £175 a month and paying off extra each payday that s left from the previous month. This way i can nuke the credit card and use it sensibly and not have to worry about cash the only downside is it slams my credit score harder

vics1928

Hi

Can you post up your SOA then I'm sure we can help you a bit more

MorbidX

In summary.
No savings/items of value

This months income is going to be around £1500-£1600 due to bonus

Normal Income:
£1250 after tax
Outgoings:
400 rent
45 elec
70 council
35 internet
35 water
65 travel
15 phone
15 misc
10 credit card (Min payments)

Subtotal: £690 (No food costs included and only me to feed, don't smoke and cant afford to drink!)

Remainder: £560

Through wonga's repayment plan tool i can setup £175 over 8 months with £74,34 as final payment in December this year.

I could always pay it off early with the remaining cash left over from the previous months wage

vics1928

You need to add in food costs.. what you afford last month? Have you any savings you can use to pay this down even a little but

MorbidX

Updated it as you posted. Food costs are negotiable i can live on next to nothing food cost wise if need be.

The only option i realistically see is repayment plan to get out the cycle and take the 6 year hit on my credit score

MorbidX

So it seems alot can change in 5 hours...

Just got off the phone with my bank and after a bit of pleading (and god knows how given my credit score) they have agreed a £1000 overdraft which means I can pay the PDL in full from my wages and tell Wonga to go **** themselves.

I can now pay all my bills and live off the overdraft this month until next payday and as i'm not paying £300 in interest to wonga each month i can clear my overdraft in 3-4 months and be entirely debt free but with more credit available... USED SENSIBLY

I've asked my bank many times before and they said no so I'm surprised they said yes this time. I was within inches at 4am this morning at agreeing to a Wonga repayment plan and knackering my credit file up for 6 years but now i've saved it and i can repair the damage repeated Wonga loans did.

Maybe i can put half a years worth of 2-3 hours sleep a night behind me

NEVER AGAIN

Pixie5740

That's good news about getting rid of the Wonga loans albeit that's a debt that's just been shifted elsewhere. It would still be a good idea to post a SOA:

http://www.stoozing.com/calculator/soa.php

so that MSE folk can give you some advice on what to cut back on to kick this debt into touch once and for all.

I found the snowball calculator helpful when tackling my debts:

http://www.whatsthecost.com/snowball.aspx

It will also help give you an idea of when you'll be debt free. :j

mandragora_2

MorbidX wrote: »

So it seems alot can change in 5 hours...

Just got off the phone with my bank and after a bit of pleading (and god knows how given my credit score) they have agreed a £1000 overdraft which means I can pay the PDL in full from my wages and tell Wonga to go **** themselves.

I can now pay all my bills and live off the overdraft this month until next payday and as i'm not paying £300 in interest to wonga each month i can clear my overdraft in 3-4 months and be entirely debt free but with more credit available... USED SENSIBLY

I've asked my bank many times before and they said no so I'm surprised they said yes this time. I was within inches at 4am this morning at agreeing to a Wonga repayment plan and knackering my credit file up for 6 years but now i've saved it and i can repair the damage repeated Wonga loans did.

Maybe i can put half a years worth of 2-3 hours sleep a night behind me

NEVER AGAIN

Well done. That's the sort of break you were after. Good luck with what you do next