MSE News: Wonga busted by the FCA: 330,000 to have their loan wiped

daveyjp

Monkeyballs wrote: »

Just reading the BBC News article and saw this, this is the sort of person who gives others a bad name;

Case study: 'I lied to get a £120 Wonga loan for a holiday'

When Elliott needed money for a holiday, he turned to payday lender Wonga.

He needed £120 and says he didn't have a problem convincing them to lend him cash by saying he worked full-time.

But the 20-year-old admitted lying on his application and told BBC Newsbeat it was "too easy" to be accepted.

He's now likely to be one of 330,000 people whose debts will be written off after a ruling that Wonga lent money to people who couldn't repay it.

"My bank couldn't give me an overdraft or anything, and so I went to [Wonga]," he says.

He received his money and went on holiday, but a few weeks later he says the firm started calling him and he says they were "constant".

"They were ringing me every day," he says. "They were telling me how much I owe and that there was added interest."

Elliot says that a few months later he was being told his debt had risen to more then £800 and it began to affect his day-to-day life.

He says the amount of the debt was making him feel depressed and that he had "no idea" what he would have done if this ruling hadn't come.

In Elliott's opinion, the whole process is too simple and he wants payday lending to be banned.

"It's so easy to go online and get one that you don't really look at the small print and they don't really tell you that much," he says.

This got me annoyed as it's typical of some of the posts which appear on this site in which the small print isn't read and the person lied in the first place! Grrr... No mention about whether help was either asked for or offered! Grrr...

MB

Th above story just shows that in this Country usury is now an acceptable method of earning a living. With a banking based economy it's not difficult to see how this has happened.

How difficult can it be to teach children from 6-18 that if you save you don't need to borrow?

gumpole

Is the tax man going to benefit from this write off of debt. Surely it is classed as un earned income.

dumpyboy

GaryBC wrote: »

As I understand it the Payday Loan industry is being forced to introduce loan 'affordability' checks. All current loans that would have failed such checks if they'd been in force at the time are being written off.

All well and good and a step in the right direction, but what about all the other lending institutions which gave out loans left right and centre in years gone by? Credit card companies who increased credit limits as soon as the old limit was reached? Mortgage lenders who agreed 'interest only' mortgages with no capital repayment plan agreed?

I've no doubt other's could add to this, but the question remains: are they going to be forced into line in a similar fashion?

There's loads of company's been in this postion sanction by a regulator I e the old oft then next thing held up shinning samples of the credit industry are we going to see the same here

lollybabe

I was so distressed at owing the massive interest because of a Wonga loan that I had to borrow money from my parents, who are not wealthy people, to repay this loan and today I found out they have written off loans for people who should not have been lent to in the first place. I repaid a part settlement of £306 of a £450 loan (the majority of which remained was interest fees).

I feel I am in that bracket as I have an extremely low income and should not have been lent so much. The worst thing is that even after struggling to raise money to part settle my credit file will still show the loan as being only partially settled and my credit rating will now suffer greatly. this is the only blemish on my credit file at this moment in time. I only paid this on 1st September. I would not expect the part settlement to be refunded to me but how is it fair that 300,000 get the loan wiped and erased from credit file but my credit file will show only part settled?

Monkeyballs

Hi Lolly,

At the end of the day I suspect that a lot of the 330,000 having their debt wiped will be people who are in the same boat that you were (and you wouldn't begrudge them would you?) or people who have no intention of paying back what they borrowed anyway.

Their debt will be wiped but their credit file will still show the default, they're not getting off so lightly.

MB

lollybabe

I don't begrudge that I have repaid, I was glad to part settle and draw a line under it, just feel a bit miffed that theirs will be wiped completely but mine will show as only part settled on credit file which doesn't look great does it?
Lesson learnt anyway - avoid Wonga lol

Monkeyballs

I'm in the same boat pickle LOL

MB x

aardvaak

so a lot of people are now just getting away without repaying what they originally asked for.

Monkeyballs

Not sure what you mean when you say "what they originally asked for"?

The statement released does say they are writing off a lot of debt, this will also include the debt of people who are repaying their debts - it's Wonga's decision to do this though.

MB

aardvaak

Monkeyballs wrote: »

Not sure what you mean when you say "what they originally asked for"?

The statement released does say they are writing off a lot of debt, this will also include the debt of people who are repaying their debts - it's Wonga's decision to do this though.

MB

The borrowers asked for the money originally they should have to repay some or most of it even at a lower or nil interest.

The companies fault was to have excessive charges and interest rates.

Without repayment of some or all the original amount the borrowers are getting away scott free.