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Escaping Payday Loans

Former MemberFormer Member Posts: 1,876,323 The Mix Honorary Guru
Right now I'm taking out Quick Quid loans to pay off Wonga loans to pay off UncleBuck loans...

Have applied for a loan from my bank but considering my overdraft's been in the red for most of the last few months I doubt they'll accept my application.

Anyone got any experience of loan consolidation plans or recommendations for getting an unsecured longer-term loan (6 months +) to get out of this hole without a good credit score and without piles of documentation?

Comments

  • Former MemberFormer Member Posts: 1,876,323 The Mix Honorary Guru
    If you're in the position where you're having to borrow money from the likes of Wonga then, truth be told, a mainstream lender will not lend you the money. That's really the long and the short of it.

    If you're still a student then the best thing to do would be go and speak to your student union or university advice centre. They can help negotiate an affordable payment plan with the likes of Wonga (in theory at least) or they might be able to help you from the hardship funds at the University.

    If you're not still a student (I can't remember in your case) then go and speak to a money adviser at your local CAB, or give CCCS or National Debtline a call.

    In either case, your payday lender will have a continuous payment authority on your debit card. This means they'll just keep bunging payment requests through until your bank honours it. The best thing you could do if you cannot afford to repay them is to cancel your debit card at the bank; this makes the CPA worthless and they have to listen to a money adviser then.
  • Former MemberFormer Member Posts: 1,876,323 The Mix Honorary Guru
    Hey Spliffie,

    You're clearly having a hard time with debts and money issues. Must be really tough but Arctic Roll's advice is great.

    Here's a link to theSite's debt resources page - http://thesite.org/homelawandmoney/money/creditanddebt/topdebtresources

    It has the details of the Consumer Credit Counselling Service and the National Debt Line.

    In fact theSite's whole section on Credit and Debit advice may be helpful to you - http://thesite.org/homelawandmoney/money/creditanddebt

    I also find this really helpful on the MoneySavingExpert website - http://www.moneysavingexpert.com/loans/debt-help-plan

    It's got check-lists of things you can do when in debt problems. It makes the process of getting out of debt seem less daunting as you're doing a small manageable task at a time.

    Even though this is a pretty crappy situation to be in, it's great that you're talking about it and looking for solutions. A problem shared is a problem halved and all that.. :thumb:

    Hope this helps.

    Keep us posted.
  • Former MemberFormer Member Posts: 1,876,323 The Mix Honorary Guru
    if you are borrowing to payback, make sure you're borrowing less than the last time
  • Former MemberFormer Member Posts: 1,876,323 The Mix Honorary Guru
    I nearly sank into a debt trap once- its easy to drift this direction. Once you're out this mess, perhaps by borrowing from family if possible, see you got your fingers burnt with payday loans. Get a bit of financial planning on paper, budget each half week for many months and write, re-write, till you've inculcated living by a strict budget
  • Former MemberFormer Member Posts: 1,876,323 The Mix Honorary Guru
    Did you manage to sort this out?

    I've had a similar problem. I currently am in debt to 8 payday loans, a bank, council tax + tv license, water + electricity and an old employer, totalling around £9,000 (mainly interest thats been added on).

    I ignored them for months on end, some for even a year and then went to see my citizens advice bureau, who then assigned me to a debt manager who i have monthly meetings with. They then contacted them all and found that 3 of the payday loans had removed my details from their system and just cancelled out the money i owed them which was pleasantly surprising! With the rest i just set up payment plans and although im now fairly skint at least i'm paying them back and have a weight off my shoulders.

    So don't worry, i thought there was no escaping my situation which was similar to you, borrowing to pay others off but i'm back on track now.
  • Former MemberFormer Member Posts: 1,876,323 The Mix Honorary Guru
    Yeah I did sort it out although I still have debts piled up. kiwifruit has the right idea, something i should have forced myself to do a long time ago.
  • Former MemberFormer Member Posts: 1,876,323 The Mix Honorary Guru
    southerncomfort: I'm surprised they didn't recommend a Debt Relief Order for you.

    spliffie: https://debtremedy.cccs.co.uk/start.aspx is a fantastic website.
  • Former MemberFormer Member Posts: 1,876,323 The Mix Honorary Guru
    Well done you for getting on top of it. Many people just ignore the situation and it only gets worse. I'd second the site recommended above - solid advice that's proven to be useful for people and the key thing is to contact creditors and your bank if you are having problems. With some persistence you can usually arrange something that's more affordavble and allows you some leeway to start targeting the more expensive debts first.
  • Former MemberFormer Member Posts: 1,876,323 The Mix Honorary Guru
    Arctic - They did recommend a DRO but that would have been on my record for the next 6 years and if i gained employment within the next year i would have to pay something to them all anyway (as my disposable income would have been more than £50) so there was no real point wasting £90 to get one, + it would affect many of the jobs i'm qualified for in admin (i.e banks and accountants dont tend to take people on with DRO's/bankruptcy).
  • Former MemberFormer Member Posts: 1,876,323 The Mix Honorary Guru
    http://www.quickquid.co.uk/apr.html

    I thought it was worth putting this link in, showing who payday loan companies try to justify their extortionate charges. It pisses me off when I see things like that, and the examples they use to try and justify things, to me anyway make them seem even more expensive rather than the wool over eyes pulling that some people fall victim to.
  • Former MemberFormer Member Posts: 1,876,323 The Mix Honorary Guru
    Define "extortionate".

    Borrowing £200 from Wonga is a whole lot cheaper than allowing your bank to give you an "unauthorised" overdraft. The APR is high because you're borrowing a small amount over a short timescale, but if banks had to publish APRs for "unauthorised" overdrafts they'd look like the biggest bargain in the world in comparison.

    If you borrow £200 for a month from your bank on an "unauthorised" overdraft, the APR could be as high as 25,000,000% APR if memory serves me correctly.

    That said, the way payday lenders market is a disgrace. But when the owner of the biggest payday lender, Wonga, is a major donor to the Conservative Party and believes that employment law "stifles the economy", I won't be holding my breath for any changes.
  • Former MemberFormer Member Posts: 1,876,323 The Mix Honorary Guru
    If you're going to Wonga for a loan you can't afford to go to Wonga for a loan.
  • Former MemberFormer Member Posts: 1,876,323 The Mix Honorary Guru
    The point is, you can't afford to go over your authorised overdraft either. And more importantly will have been turned down for an overdraft facility/extension and/or credit card.

    The worrying thing about wonga etc is not that they're expensive, it's that they're actually the best option for certain groups of people.
  • Former MemberFormer Member Posts: 1,876,323 The Mix Honorary Guru
    Fiend_85 wrote: »
    The point is, you can't afford to go over your authorised overdraft either. And more importantly will have been turned down for an overdraft facility/extension and/or credit card.

    The worrying thing about wonga etc is not that they're expensive, it's that they're actually the best option for certain groups of people.

    We can always point to other examples of cunty finance practice, but I've never been a fan of pointing out other turds to distract from the turd just stepped in.

    How expensive Wonga are is really worrying; it's borderline criminal. I was reading something the other day about borrowing £100 from Wonga and if you didn't pay any of it back you'd have the national debt of the U.S. within 7 years.

    Wonga aren't the "best" option for anyone. They're often just the only option left for people who are out of "credible" lenders.
  • Former MemberFormer Member Posts: 1,876,323 The Mix Honorary Guru
    Issues with Payday Express

    I had issues with payday express for a long while, I defaulted on payments on 2 occasions and debated taking out another loan with a different lender to fund the original loan with payday express i'm glad i didn't... since recent clamp downs with the OFT payday express has really bucked their idea's up and been allot more willing to negotiate a payment plan around which I can afford.

    Far from a perfect result but things are defiantly on the up.
  • Former MemberFormer Member Posts: 1,876,323 The Mix Honorary Guru
    Hey there jasonbross,

    Thanks for your post and welcome to the boards.
    This thread is from a long time ago and here on the boards we don't like to drag up old threads as the matter has probably been resolved for the original poster (OP).
    If you have a new query then you can post a new thread. This thread is already closed.
    Also feel free to post in the Introduce Yourself section.
    Happy posting!
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