How to pay off loans

ent_moot

I'm trying to sort out my parents finances.

They have a bunch of high-interest loans that I would like to pay off; however, I'm having real trouble tracking down who they are with.

Should I just cancel the direct debts and see who comes calling, or is there a better way?

[Deleted User]

Only if you want to completely kill their credit files. That may or may not matter to them.

Try tracking down the companies via the DD references

ent_moot

Killing their credit rating sounds like a good idea and may help to protect them. As far as I'm concerned, other than a mortgage, offering any type of credit outside of a business context is exploiting vulnerable people.

And to be honest, if they ever take out any type of loan or buy something on credit again, I may be forced to disown them.

I'm currently paying their full mortgage for them, and covering their loans to save them from losing their house.

I've tried tracking down the company from the DD statement; however, they are being shirty with me and won't allow me to pay off the loan without her account number which she no longer has.

ViolaLass

Your parents were, presumably, not forced to take out the loans.


The account number may be given as a reference number with the DD payment. Try looking on your parents online banking, assuming they have it.

PeacefulWaters

ent_moot wrote: »

As far as I'm concerned, other than a mortgage, offering any type of credit outside of a business context is exploiting vulnerable people.

While I'm not in anyway a fan of using interest charging credit for myself, to suggest that everybody taking out credit is vulnerable and being exploited is bonkers.

ent_moot

While I'm not in anyway a fan of using interest charging credit for myself, to suggest that everybody taking out credit is vulnerable and being exploited is bonkers.

I am a little bit bonkers, and the first to admit it.

However, I stand by my statement. I believe it to be a common psychological vulnerability that people believe that they need possessions now to survive or to be happy. Quite to the contrary: much greater happiness and satisfaction is gained my making do without and then buying the possession with money saved.

But of course, you are absolutely right: there are genuine scenarios where one might stand to save or earn considerable money by borrowing to be able to afford something with extremely high utility (e.g. a car). However, this is a tiny minority of cases.

[Deleted User]

It's also quite hard to save up for a house.

ViolaLass

ent_moot wrote: »

I am a little bit bonkers, and the first to admit it.

However, I stand by my statement. I believe it to be a common psychological vulnerability that people believe that they need possessions now to survive or to be happy. Quite to the contrary: much greater happiness and satisfaction is gained my making do without and then buying the possession with money saved.

Still doesn't mean those people are vulnerable.

Are you angry with your parents but taking it out on lenders?

Westminster

If you are really concerned about their access to further finance then I would consider their agreement to a Power of Attorney a condition to your continued assistance.

I've never had to use it so not 100% certain it's right for you but could be worth looking at?

ent_moot

If you are really concerned about their access to further finance then I would consider their agreement to a Power of Attorney a condition to your continued assistance.

Thanks, this is useful information. I won't go down this path yet, but it may be an option in the future if they take out another loan while I'm paying their mortgage.

I don't think they will. Until now, it's just been my advice that they've ignored. They are definitely trustworthy, just not very wise when it comes to money. Now that I'm paying their full mortgage, I think they will keep their word. They have also now given me sole access to their internet banking and have promised that there will be no more loans.

The account number may be given as a reference number with the DD payment. Try looking on your parents online banking, assuming they have it.

Thanks, this was helpful. Although it wasn't included against the DD line, in the DD setup, it was possible to find the account number of a couple of the loans.

Your parents were, presumably, not forced to take out the loans.

Obviously they were not physically forced to do so, but they were definitely exploited.

Are you angry with your parents but taking it out on lenders?

I'm disappointed in my parents, yes. However, the decision-making that led them to their situation was naivety. Lenders who lend at a rate approaching double figures are making a calculated decision to exploit the psychological vulnerabilities of the average person. And typically, the greater the vulnerability, the stronger the exploitation.

I actually put credit cards into the same category. Why do you think credit card companies can afford payment protection and bonus points and still make a profit? Because the average person loses considerably more on a credit card than they gain.

Yes, because I'm more disciplined than the average Joe Bloggs, I could own a credit card and save a few pounds here and there. However, I would then be taking part in what is a scam to exploit vulnerable people. Being able to tell the victims of credit cards that I don't own one and am better for it is of much greater value to me than the few pounds I might save.

Now, chances are you have a credit card and you don't like being called vulnerable. Well, sorry to hurt your feelings, but statistically speaking, you've probably lost money by owning that card.

[Deleted User]

ent_moot wrote: »

Being able to tell the victims of credit cards that I don't own one and am better for it is of much greater value to me than the few pounds I might save.

What a thoroughly unpleasant person you are. Makes me glad I don't have financially incompetent parents like you do.