The Payday Loan Trap!!!

[Supernick]

Hi Everyone As a newbie i thought i would begin by discussing my ongoing hell with the payday loan trap, what i plan to do about it, and with any luck get the opinion of others. After all, thats why we are all here i guess.Anyway, about 5 months ago, my salary at work went from being a weekly paid event, into a monthly paid one. This was fine, i thought i might find it better to be paid once a month, pay all my bills on payday, and then i know whats left is mine to do as i please.The only problem i could see was that i needed to get through the next 4 weeks on one weeks wage before the new monthly scheme kicked in. Enter my first payday loan. Great help for a couple of weeks, then i wished i had taken just a touch more as i was already running low and i still had 2 weeks to go until payday. Enter loan number 2!!When i eventually got to payday, i had to pay of the loans plus the interest which again left me a little worried about how i was gonna make it to payday again.5 months later, of taking out more and more loans just to keep paying the interest and rolling things over am now up to 7 diffent loans totalling 1.5x my monthly salary.I am very aware that this ridiculous situation is entirely my fault, and have realsised that just to pay the interest alone for all these loans would leave me short enough to need to try and take another one!!!I have decided that the only thing i can possibly do, is cancel the direct debits, report my debit card lost and get a new one. I will then be back in control of whats going out of my bank, and i can then contact each lender, and discuss setting up a payment plan.If anyone can add to this or give me a pointer that would be great.This trap is far to easy to fall into if you find yourself a little short one month and could potentially take a year or so to get back on track.

[Fountainhead]

Hi

 

Just so you know I am in a similar situation. I am selling a few things on ebay but I don't know what else to do, especially with Christmas coming up. I found this site "Payday Loan Trap" which has some good tips on.

Also try CCCS - Free Debt Advice from the UK's Leading Debt Charity they might be able to help you.

 

Good luck and let me know if you get out of this!

Edited November 24, 2008 by jonni2bad

[geministar2007]

i would call someone like CCCS or payplan, they can advise you of the direction to take and can talk to your creditors on your behalf. Alternatively you could send payment proposals to the companies. I fell into problems with samedaycash (now wonga), they were not at all helpful but when they transfered the debt to chequespread a DCA, they happily accept my offer of £1 a month (all i could afford) and stopped charging me interest. £150 was already up to £300 + in fees. Also Mem consumer finance part of another payday loan paydayuk i think, accepted my £1 offer they are still getting this now through my DMP with Payplan. I owe them £90 i only owed £100.

 

Good luck and try not to worry!

[IdaInFife]

You are deffinately heading in the right direction by taking control again and at least you are aware if they dd fails then they will try card details.

 

Sit down and workout what your outgoings are and make pro rata offers to them, here's some templates that will help:

 

http://www.consumeractiongroup.co.uk/forum/general-debt-issues/20758-creditors-dcas-letter-templates.html

 

 

Ida x

[fudgethenudge]

I have also fell into this trap and having now lost my job have been advised by the CCCS to offer £1.00 per month. I have set up standing orders to pay all 3 of my payday loan companies but so far have heard nothing from them since doing so 6 months ago. As I am making a regular payment there is not much they can do. So good luck

[geministar2007]

My partner has a pay day loan, this was for £200. He has paid the interest only each month of £63, at the end of this month that will be his 4th payment of interest in which he would have more than paid back what he borrowed plus interest.

 

What is the likelihood of them agreeing after this fourth payment that the debt has been settled? He has never had enough at the end of the month to pay anymore than the interest, but he cant go on like that forever.

 

Your thoughts would be greatly appreciated. Thank you.

[fudgethenudge]

My partner has a pay day loan, this was for £200. He has paid the interest only each month of £63, at the end of this month that will be his 4th payment of interest in which he would have more than paid back what he borrowed plus interest.

 

What is the likelihood of them agreeing after this fourth payment that the debt has been settled? He has never had enough at the end of the month to pay anymore than the interest, but he cant go on like that forever.

 

Your thoughts would be greatly appreciated. Thank you.

 

I doubt if they will say that the debt will be settled. They are only out to make money, so I would go to the CCCS and ask their advise. I was paying the interest only for over 6 months and still they say I owe them the full amount plus interest - hence they now get a pound a month. One of them has taken me to court so now the interest has been stopped and they still get a £1.00 a month as that is all I can afford when I am on benefits.