PayPal negative balance

Erinf93

Hello, 
Looking for some advice please, I am in a bit of a pickle!
Over the last 2 years I have been transferring money from my PayPal account to a friends using the bank option when it takes a few days to come out of your bank. It started as £100 and increased month by month to pay bills and other debts. It is currently at £3800.
PayPal have finally clocked onto what I was doing and won't allow me to transfer using the 'bank' options anymore and I don't have £3800 to clear the now negative balance.
I have ignored emails from PayPal but this morning they have tried several times to call me. Where do I stand? Can I offer to pay back small amounts at a time? I have seen it can be sent to a debt collectors, is this going to negatively affect my credit score? I will pay it back but I can't pay the full amount all at once.
Thank you 

soolin

There is nothing to stop you offering to pay the debt in instalments, they can of course say no. 

This does seem a strange way of doing things and I can see several reasons why PayPal think it concerning, out of interest what stopped you doing a simple bank to bank transfer? 

MyRealNameToo

soolin said:

This does seem a strange way of doing things and I can see several reasons why PayPal think it concerning, out of interest what stopped you doing a simple bank to bank transfer? 

Sounds like they were using it as a short interest free payday loan... send money to a friend who then passes it back to them via Faster Pay and so they had the money in their account before PayPal had taken the original transaction out of their account. 

Erinf93

MyRealNameToo said:

soolin said:

This does seem a strange way of doing things and I can see several reasons why PayPal think it concerning, out of interest what stopped you doing a simple bank to bank transfer? 

Sounds like they were using it as a short interest free payday loan... send money to a friend who then passes it back to them via Faster Pay and so they had the money in their account before PayPal had taken the original transaction out of their account. 

MyRealNameToo said:

soolin said:

This does seem a strange way of doing things and I can see several reasons why PayPal think it concerning, out of interest what stopped you doing a simple bank to bank transfer? 

Sounds like they were using it as a short interest free payday loan... send money to a friend who then passes it back to them via Faster Pay and so they had the money in their account before PayPal had taken the original transaction out of their account. 

This is what I was doing, it didn't happen all at once, it was £100 sometimes more over 2 years so month 1 it was £100 then £200 it started increasing and instead of not paying my bills and other debts I just kept doing it as it gave me a bit of breathing space for a couple of days till they took the money from my account and then I would do another transfer, I was doing this every couple of days.
I have cleared most other debts I had that where adding interest and thought I could keep doing this till it reduced down and I transferred less and less each month. It was at around £4500 at one point but I have gradually reduced it.
I lost my job and my income was significantly reduced and I was trying to keep on top of all the bills and debts. 

Erinf93

soolin said:

There is nothing to stop you offering to pay the debt in instalments, they can of course say no. 

This does seem a strange way of doing things and I can see several reasons why PayPal think it concerning, out of interest what stopped you doing a simple bank to bank transfer? 

If they say no is it going to have a big impact on my credit score? I've never missed a payment on any account in 15 years, my credit score has started to improve but I am now worried this is going to negatively impact it. I have closed all my credit cards down so I don't have the option to do a money transfer or pay the balance with a credit card 

soolin

Erinf93 said:

soolin said:

There is nothing to stop you offering to pay the debt in instalments, they can of course say no. 

This does seem a strange way of doing things and I can see several reasons why PayPal think it concerning, out of interest what stopped you doing a simple bank to bank transfer? 

If they say no is it going to have a big impact on my credit score? I've never missed a payment on any account in 15 years, my credit score has started to improve but I am now worried this is going to negatively impact it. I have closed all my credit cards down so I don't have the option to do a money transfer or pay the balance with a credit card 

Whatever happens it won't be instantaneous  - but there are some regulars on here that can give you a much clearer view of what is likely to happen - so I'd wait for them to respond. 

It might help shape advice if you had a suggested time frame you thought you could clear this debt within.

born_again

Forget about you score that is meaningless.
I would be more worried that PP are going to see this as ML & add a CIFAS marker.

Erinf93

born_again said:

Forget about you score that is meaningless.
I would be more worried that PP are going to see this as ML & add a CIFAS marker.

What is ML? And what is a CIFAS marker? 

CliveOfIndia

Erinf93 said:

born_again said:

Forget about you score that is meaningless.
I would be more worried that PP are going to see this as ML & add a CIFAS marker.

What is ML? And what is a CIFAS marker? 

ML = Money Laundering

CIFAS = the industry-wide fraud database

Erinf93

CliveOfIndia said:

Erinf93 said:

born_again said:

Forget about you score that is meaningless.
I would be more worried that PP are going to see this as ML & add a CIFAS marker.

What is ML? And what is a CIFAS marker? 

ML = Money Laundering

CIFAS = the industry-wide fraud database

What can I do? Am I best to call them and offer to pay it off in installments?? 

CliveOfIndia

Erinf93 said:

What can I do? Am I best to call them and offer to pay it off in installments?? 

That is certainly one option.  Though (if they agree to this) it will be marked on your credit record as an "Arrangement to pay", which is viewed negatively by other lenders.

Erinf93 said:

I have closed all my credit cards down so I don't have the option to do a money transfer or pay the balance with a credit card 

You wouldn't be able to pay the debt with a credit card anyway.  But it may be worth trying a few eligibility checks to see if you could get a Money Transfer card.  There's usually a fee to pay for doing the transfer, and you might not be offered a sufficiently high limit to allow you to clear all the debt, but it's worth looking into.

Do be aware, though, that if you did go down this route, you must make sure you'd be able to repay the credit card when the promotional rate expires.  Otherwise, any remaining balance will start accruing interest at the card's standard APR, with no guarantee you'd be able to do a Balance Transfer to another card.

It may be worth filling out an SOA ( https://www.lemonfool.co.uk/financecalculators/soa.php ), select the "Format for MSE" option and paste the results into this thread.  Other folk may be able to see areas where you can reduce your expenditure to allow you to pay more towards the debt.