Wonga.com 2334% Apr Help

[MoneyExploding]

I am not an authority on short term unsecured loans. I do however have 10 + yrs experience of finance and how these disputes pan out. In the vast majority of cases where the APR breaches 50% the court rules in favour of the debtor on useary grounds (extortion). Companies are aware of this and try to elongate the time of standard accumalitive interest rate to extract as much as they can before actually going to court, that is even if they bother to do so as the cost of legal proceedings often exceeds the recouping of the debt and interest. They will send scary letter after scary leter to extract what they can.

 

If you borrow £300, get into bother with the loan, get some scary letters and pay £500 over a year, yet still have an outstanding balance no court in the land will fall favour to the lender in my experience. For exapmle that type of repayment equates to 66% flat return, most banks work on between 2-6%. They have had their return already and should not be persuing you for more.

 

Stop paying, request court action. If they refuse take them to the small claims court first. Document and date all correspondance. For £1000 or less they probably won't even turn up therefore you will automatically win. You may even get the original debt wiped.

 

Rule 1. The more aggressive the letter, the weaker the stance of the agressor. If they had an easy case they would simply go to court and win and save the cost of the letter. Ignore scary letters, acknowledge calm considered ones. Coloured print, usually red and official sounding legal firms are a favourite. Asquth Wallace and Squat of London etc etc, all BS, tin pots in an office in Aylesbury with a Mayfair po Box to make them sound good to those who have little experience of the law.

 

Rule 2. Seek advice. Go to the CAB or other debt management charity and discuss your situation. Avoid like the plague fee charging private debt management companies. They don't do anything you can't do for free and charge exorbitant amounts for it.

 

Rule 3. If you are struggling with debts stop digging. There are many charities and govt bodies who will help. The longer you wait to get help the bigger the problem will become.

 

Rule 4. Never ever take out a short term loan if you have any doubt at all you can repay it. These loans are structured in a way that means you borrow say £90 and repay £100 for a few days, which is attractive if you are in a hole. However, the rate they charge is in flat return (the way banks calculate return) is very high and the interest on the same loan over a year is astronomical. Add the fees for late payment as well and you are into the 3000% APR plus country.

 

Rule 4. Baliffs usually have an IQ lower than 6, very easy people to out smart. They do not have right of entry to your home despite what they say, the police do, baliffs don't, but an easier route to take is to prove to them all item of value in the place you are staying do not belong to you. Register your car to a friend or parent, declare yourself a lodger of your partner and produce paperwork to prove this, effectively become a legal lodger in your own home. They cant even touch the door bell if you have proof none of the items are yours.

 

Think of it like this, if you were renting a room, and in debt, and the private baliff came round to talk to you and reposess your stuff, if they took items belonging to your landlord, how long would their case stand up in court? It wouldn't. Assume this position. Baliffs like to make an enterance but hate heat, they won't do anything to encourage legal investigation. Stealing a third parties belongings to settle a debt not associated to the third party will cause them more than warm heat.

 

Lastly an finally, debt is scary, it shouldn't be. Its just numbers on paper. The creditors can't kill you, take your family, cut your gas off, put you in prison. If you are in debt, step back, use the FREE tools available to you, stop burying your head and face up to aggressive lenders with more force that they attack you. Believe me they hate it, they want passive idiots who keep paying, don't be one especially to the sharks.

 

If you can't manage your debt, go bankrupt. Thats what it is for. If you owe lots and have limited assets you have nothing at all to lose. Add up what you own, minus what you owe. If the net result means you can't recover easilly within 5 years to a balance of zero, go bust and start again.

 

I really hope this helps. Genulnely I do.

 

MoneyExploding