Reckless Lenders

Richard_S

moneysaver1980 wrote: »

thats not really answering the question Richard is it

No it's not, but this is:

It's taken me a while to think about that, but the honest answer is that I never said anything that wasn't true. I'm sure you won't believe me, but I really don't mind. With the benefit of hindsight I should have borrowed more and just stashed it out of reach; followed the example of politicians and our revered captains of industry.

Richard

cinnabar

Richard_S wrote: »

Hi cinnabar,

I'm rather weary of people saying that bankrupts make borrowing more expensive for everybody else.

So am I, actually - I'm just regurgitating what I've heard other people say! The general consensus among the people I know who talk about this subject (who may not be representative of society as a whole, it's true LOL) is that bad debtors make it harder/more expensive for everybody else. I would have thought that money lenders are making so much money from everyone that the amount they lose through defaulters is fairly insignificant compared to their profit, or why else would they continue to lend? If everyone stopped paying them at the same time, it would be different of course, but in general people borrow money and expect to pay it back - yes, even bankrupts!

As I said, I've been led to believe (and I think it suits creditors if we do as it probably has the effect of making us more likely to repay them) that bankrupts and other 'bad' debtors push the cost of borrowing up. I'm ashamed to say, I know little about economics, and have swallowed whole what I've been told

nearlyrich

To be fair if I went out tomorrow and spent all the credit on my credit cards I wouldn't be able to meet the payments, maybe the minimum payments but definitely not pay it all off in a reasonable time. I could probably spend 3 times my salary without too much trouble and without having to ask the banks to give me more.

I'm not saying the banks have been reckless opening up these lines of credit because I know I won't be tempted to use them but if I was made redundant a week before Christmas or my children were in need of shoes who knows?

It's really easy to judge people without ever having been in that position....

Richard_S

cinnabar wrote: »

So am I, actually - I'm just regurgitating what I've heard other people say! The general consensus among the people I know who talk about this subject (who may not be representative of society as a whole, it's true LOL) is that bad debtors make it harder/more expensive for everybody else. I would have thought that money lenders are making so much money from everyone that the amount they lose through defaulters is fairly insignificant compared to their profit, or why else would they continue to lend? If everyone stopped paying them at the same time, it would be different of course, but in general people borrow money and expect to pay it back - yes, even bankrupts!

As I said, I've been led to believe (and I think it suits creditors if we do as it probably has the effect of making us more likely to repay them) that bankrupts and other 'bad' debtors push the cost of borrowing up. I'm ashamed to say, I know little about economics, and have swallowed whole what I've been told

I don't think anybody has all the right answers cinnabar, otherwise how can the country's top economists sitting on the BOE board have different ideas about interest rates?

You're just as likely to be correct as anybody else.;)

Richard_S

nearlyrich wrote: »

To be fair if I went out tomorrow and spent all the credit on my credit cards I wouldn't be able to meet the payments, maybe the minimum payments but definitely not pay it all off in a reasonable time. I could probably spend 3 times my salary without too much trouble and without having to ask the banks to give me more.

I'm not saying the banks have been reckless opening up these lines of credit because I know I won't be tempted to use them but if I was made redundant a week before Christmas or my children were in need of shoes who knows?

It's really easy to judge people without ever having been in that position....

Hi rich,

It's nice to see you making a contribution and you raise some very good points. The pressure, especially on parents, to spend money is intense, banks and financial institutions by pressurising their staff to keep selling financial products are exacerbating the situation.

Governments need an expanding economy; comapnies have to sell their products; the media has to sell advertising space; banks have to lend money; consumers would have to be automatons not to respond to that sort of pressure.

We're all part of a process that is bigger than any of us, and when a few "fall of the wagon" into debt or bankruptcy, it's really not to be wondered at.:D

wherediditallgo

moneysaver1980 wrote: »

I dont think thats true, are you saying you were 100% honest on all the credit you ever got ?

Yes. When I first got credit, it was to have the credit facility, not to get more credit than I was eligible for. When I hit financial difficulties, my applications for credit were 100% honest too. Perhaps I'd have got more credit by lying, but my intention was to get credit quickly, not to get it fraudulently.

sortofsilver

I am sorry to say that you cannot blame someone else for your own debt problems. I like many others are constantly being sent offers of loans and credit cards with my bank statements, but at the end of the day the choice is mine. It's a choice to sign on the line and it's a choice to spend the money and have no one to blame but myself for money foolishly spent.

betterlatethannever

..and after you sign on the line Silver, then lose your job (unexpectedly) or suffer an accident/illness..........
Its called life, and no one knows whats round the corner, not the banks nor the person taking the credit out. Whats supposed to happen then?
An honest answer would be good.
If you were made prime minister and could abolish bankruptcy. what would you replace it with? how would you make those that can not pay, pay? i truly would like to know the answer. I know BR has its faults, and that they are many, but so does the benefits system/the imigration system etc etc.
I'd love to hear how this could be resolved and made more balanced for both those that were unable to pay and those that choose to pay, there IS a difference.

wherediditallgo

I'd be interested in the solution too. The first credit I ever had was a store card from Debenhams - I was in there shopping with money I'd got for my 18th birthday & the person on the till offered it to me. Being able to shop without using actual cash was a new thing to me, & it had its attractions. I don't think any info about interest rates was given in those days, but even if it had been I don't know how much it would have meant to me then - being 18 now is different from being 18 over 20 years ago, & I wasn't the gobby worldly-wise teenager that we so often come across today. Thus started my descent into debt hell.

None of my debt has been fraudulently obtained or to fiddle a system. I didn't deliberately rack up credit, then deliberately not pay the bills then saunter off to the court to have the slate wiped clean. It hasn't been either, as I pay a monthly IPA towards my debts. At 18, I wasn't to know that I'd end up with a partner who worked but couldn't see we should be working together, someone who thought nothing of blowing £2k at a poker night but would freak if I wanted some money from him because the gas bill needed paying. I wasn't to know that I'd be severely ill for years, restricting my ability to earn any extra money to help with the debts. You can't predict some things in life, especially when it comes to the actions of others. It makes me wince that some debts are seen as socially acceptable, such as a mortgage or a loan for a new car, even though the decision to get them may have been just as foolishly made. I've had times when I've been ill, with an array of medications around me, & scared to put the heating on higher because I wouldn't be able to afford the bill. I didn't get in that situation overnight or because I spent thousands on designer gear. When someone has to choose between a short-term loan to get the heating paid for & being sick with no heat, it's not fun. People who've been in such a situation or a similar one have an appreciation of what debt can be like for some people, but I'd like to think that even those who have lesser debts would have some sympathy even if their own situation isn't as bad as that.

"Armchair politicians" are greater in number than BRs ever will be. I wish they'd come up with a solution that differentiated between those who were paying their bills regularly until a change of circumstances affected their ability to pay and those who take on the debt knowing they're unlikely to make more than a few payments at most before they start struggling or just don't bother, instead of passing negative/fatuous comments on how some people deal with a situation they've been fortunate enough not to have to face yet themselves.

Zebedee69

wherediditallgo wrote: »

I wasn't the gobby worldly-wise teenager that we so often come across today.

No your not, your a bankrupt which is worse:mad:

Sorry mate I had to grab your attention because kids have to work harder and faster and learn more at Uni than anyone before them. Large difference between having to be confident and having to grow up quickly in a harsh world and being "gobby".

Most students leave Uni with £20000 of debt. If banks/government didnt lend to them then we would produce no credible workers and our economy would die a sudden death. We have a trade defecit so our industry is a knowledge based one not an manufacturing based one. No knowledge.......... No industry, you would be the first to complain without a job to go to on Monday.

Sorry for having a pop at you... I just hate it when people label all kids as bad. Im sure that in 10 years time when the Doctor and Nurse are treating you at hospital you wont think of them as bad will you. Well that Doctor and Nurse are the same kids your putting down today and will probably still be swiming in 1000's of student debt!