Persistant Debt - Opus Newday

careRC

Earlier this year I was put on a persistant payment plan at a staggering interest rate of 40.0005% over 4 years for a credit card debt of £11,400,  This has arisen because I have mostly just paid minimum payments over the years, I am not in arrears and never missed a payment.  
I am currently absent from work signed off by G.P, while  shielding / caring for elderly parents both aged in their 90s, because of covid-19 restrictions.  I also am not in good health, stress (medicated) heart and previous cancer patient - I have contacted Opus 3 months ago with no response though Resolver.   Recently I applied for 3 month payment holiday - only to discover that in those 3 months the interest alone was being added at approx £380 - £400 per month.  Over 3 month payment freeze, I will have paid approx 10% of my total outstanding balance, in covering the interest alone, how is this helping? - Opus won't talk to me, they and ombudsman have not replied with any response other than generic terms, I cannot phone because of costs, and huge waiting times. 

eskbanker

careRC said:

Recently I applied for 3 month payment holiday - only to discover that in those 3 months the interest alone was being added at approx £380 - £400 per month.

Yes, this is explained at https://www.moneysavingexpert.com/news/2020/03/uk-coronavirus-help-and-your-rights/#loanhelp and should have been covered in similar terms when you arranged it with the card company:

You'll still be charged interest during the payment holiday. This means you'll likely end up paying slightly more overall. So it's best to do this only if you need to – if you can pay, it's best to keep doing so.

Maybe worth posting on the debt-free wannabe board for ideas about how to get after your debt?

https://forums.moneysavingexpert.com/categories/debt-free-wannabe

jjames1985

Having you pay interest only reduces the amount you need to pay them, freeing the money up for other things like rent, mortgage payments or food. How is that NOT helping?  Also worth noting that they're doing what they've been told to here, there's nothing out of the ordinary about interest still being liable.  I don't think it's helpful to be complaining about the interest accruing on a debt you ran up, with an interest rate that was clearly stated in advance.

Maybe you should speak to a debt charity, although realistically the only way they are going to stop charging interest is if you default or declare yourself insolvent.  Obviously those have potentially long-lasting effects so speaking to a debt charity and asking for advice is probably a good idea.

MEM62

A payment freeze is a payment freeze, not an interest freeze.  This has been widely published.  As advised already, you need some proper help with your debts.  Get in touch with one of the debt charities and let them guide you.   

jet01

Djjames1985 said:

Having you pay interest only reduces the amount you need to pay them, freeing the money up for other things like rent, mortgage payments or food. How is that NOT helping?  Also worth noting that they're doing what they've been told to here, there's nothing out of the ordinary about interest still being liable.  I don't think it's helpful to be complaining about the interest accruing on a debt you ran up, with an interest rate that was clearly stated in advance.

Maybe you should speak to a debt charity, although realistically the only way they are going to stop charging interest is if you default or declare yourself insolvent.  Obviously those have potentially long-lasting effects so speaking to a debt charity and asking for advice is probably a good idea.

A little bit harsh on the OP. For sure New Day have acted within the law but at the end of the day their customers go to them in the first place because they don’t have access to mainstream cards with a lower APR. No one signs up for a card with 40% apr unless they are desperate. The OP is a career and in poor health with a limited income. I think the likes of New Day should be more proactive in working out a payment plan for customers like the OP instead of continuing to charge 40% on the debt. It is a very sad state of affairs especially in the current climate that people like this have to go to debt charities and the like before the card companies will agree a realistic affordable repayment plan. After all these cards have such an high APR because their customer base is likely to have a high default rate so this should be reflected in the way they respond to customers in difficulty. 

diggingdude

MEM62 said:

A payment freeze is a payment freeze, not an interest freeze.  This has been widely published.  As advised already, you need some proper help with your debts.  Get in touch with one of the debt charities and let them guide you.   

I never cease to be amazed how many don't understand they will continue to be charged interest

[Deleted User]

jet01 said:

Djjames1985 said:

Having you pay interest only reduces the amount you need to pay them, freeing the money up for other things like rent, mortgage payments or food. How is that NOT helping?  Also worth noting that they're doing what they've been told to here, there's nothing out of the ordinary about interest still being liable.  I don't think it's helpful to be complaining about the interest accruing on a debt you ran up, with an interest rate that was clearly stated in advance.

Maybe you should speak to a debt charity, although realistically the only way they are going to stop charging interest is if you default or declare yourself insolvent.  Obviously those have potentially long-lasting effects so speaking to a debt charity and asking for advice is probably a good idea.

A little bit harsh on the OP. For sure New Day have acted within the law but at the end of the day their customers go to them in the first place because they don’t have access to mainstream cards with a lower APR. No one signs up for a card with 40% apr unless they are desperate. The OP is a career and in poor health with a limited income. I think the likes of New Day should be more proactive in working out a payment plan for customers like the OP instead of continuing to charge 40% on the debt. It is a very sad state of affairs especially in the current climate that people like this have to go to debt charities and the like before the card companies will agree a realistic affordable repayment plan. After all these cards have such an high APR because their customer base is likely to have a high default rate so this should be reflected in the way they respond to customers in difficulty. 

Of course it's difficult for the OP but the bank are not a charity. If every customer took the money and accepted the APR then came up with a story about how it was all so unfair and can they pay no or little interest, the bank wouldn't exist.

The way forward, as others have said, is for the OP to actively manage their debt problem and take ownership of it. 

Too many people (not the OP) expect everyone else to sort out problems they themselves have created. Life is tough sometimes, and banks are already asked and expected to approach debt issues for customers in a sympathetic way. However, the responsibility lies with the supposed adult who made the decisions to get into debt in the first place. Some people are quick to grab the money but moan they shouldn't have been given it when it suits!

jonesMUFCforever

How does one get a limit of £11400 with a Newday card?
I thought it was a low limit high rate card?

[Deleted User]

Opus are mostly old Citi cards. Most of those customers were mainstream with reasonable limits.

It's only recently been opened up for acquisition.

The OPs post suggests that it's a long standing account.

Malkytheheed

jet01 said:

A little bit harsh on the OP. For sure New Day have acted within the law but at the end of the day their customers go to them in the first place because they don’t have access to mainstream cards with a lower APR. No one signs up for a card with 40% apr unless they are desperate. 

Really? I have an excellent credit file and I went to NewDay and took out a very high APR card. I'm certainly not desperate. I chose that card. 

sleepyjones

The only thing you can really do is try and talk to them again, explain your situation and ask for an Interest freeze, if they were to agree they'll likely put a hold on your card completely so you won't be able to use it (which probably won't be a bad thing).
Failing that you'll need to go chat with StepChange or someone like that and see if they can get an Interest freeze in place.

**This is not advice** - Just asking the forum, is it ever worth deliberately getting a default in order to freeze interest?