Payday Loan

blueberry5

I was wondering if anyone could tell me where I stand please?

In 2013 I took out a payday loan, now controlled by Kapama Ltd. The loan amount was £200. I had several other payday loans at that point as I was awaiting benefits for mental health reasons and they took months to come through. I was even using a food bank at this time. When I applied I put the payment date in wrong by mistake. I didn't notice until after they had paid me the money. When I tried to change the date, they wanted the initial money back plus £35 on top to change the date. I didn't have this. So I defaulted. This within 2 months brought the debt up to £860 where it has remained.

Do I have any rights to be able to get this amount down to closer to the amount I borrowed or do I not have a leg to stand on? I was under a psychiatrist at this point too.

Thank you

sourcrates

Hi,

Are you currently been chased for this debt, if so who by ?

After 4 years I assume a debt collector has written to you ?

blueberry5

Yes. The original loan was Toothfairy finance but now it is Kapama Ltd. They never write to me though, only email me and previously phoning me endlessly (multiple times a day) I would like to clear the debt but £680 on top for a £200 loan seems a bit excessive, and I am still only on ESA so can't afford £860

BrassicWoman

Mental health would be very tough to apply unless you were actually sectioned at the time of the loan (in which case, probably could not have applied)

Have you spoken to one of the debt charities?

blueberry5

It wasn't so much my health, more the fact, that they gave a payday loan to someone on benefits and yet it is just to add 340%(ish) on top when they can't afford to pay

fwor

It seems that Toothfairy were under investigation by the FCA at roughly the time that your loan was taken out, and there was some concern about the fact that some of their charges were unfair and/or illegal.

I would expect that one of the debt charities would know about this and be able to advise on the latest status. Unfortunately the FCA work was mainly looking at late payment charges after default - which may only partly cover your situation. And as I understand it they went into administration before the FCA report could be completed - so I'm not sure what that means for people in your situation.

blueberry5

Actually, I just googled it. It wasn't toothfairy finance it was mini credit which no longer exists. Sorry for the confusion

Clive_Woody

Give one of the free debt charities a call and they can help you deal with this. Step Change is the charity I have heard of and should be able to help

https://www.stepchange.org/Howwecanhelpyou.aspx

blueberry5

Clive_Woody wrote: »

Give one of the free debt charities a call and they can help you deal with this. Step Change is the charity I have heard of and should be able to help

But surely, they will just help me make an arrangement to pay the £860 back. I have just been through the historic transactions on my account and saw that on the 30th September 2013 I received £120.50 from Minicredit. They were closed down on the 1st April 2014 for illegal/unjust charges. How can it be just to charge someone £760 in charges for a £120 loan???

blueberry5

I just looked up how much that is, and that is 570% increase of fees and charges on a loan of £120.50. That is ridiculous. How can they enforce those kinds of charges???

IAmWales

blueberry5 wrote: »

I just looked up how much that is, and that is 570% increase of fees and charges on a loan of £120.50. That is ridiculous. How can they enforce those kinds of charges???

Your calculation is wrong. Compounding over four years it is approx 37%. The reason it appears so high is because you've ignored it for so long.

How much can you afford to pay each month, have you made an offer to pay by instalments? They may ask you to complete a statement of income and outgoings to assess what you can afford.