Wonga Good For Financial Health? No No No

[instructor]

I write this as an advisory note to any person who considers taking a loan out Wonga or any of its associate companies.

I simply say do not!

I foolishly believed that taking a loan from this Firm would indeed enhance my credit rating, a view which is most prevalent in all their advertising material.

Unfortunately this is so not the case, indeed a loan from this indiscriminate parasite of Financial health will turn a reasonable rating into your financial life loosing its battle on the operating table.

Wonga and its associates are out for one thing and one thing only. Not to improve your life in any way but to profiteer from peoples misfortune, be it through its emptying of your bank with roll over and excessively priced loans or indeed your financial dependence on main stream lenders.

 

I asked the company to remove the fully paid accounts from my credit file, but to my astonishment they took the morale high ground saying they had a duty and obligation to report all transactions to credit reference agencies. Is it not a pity they show such morality when emptying their poor unsuspecting customers bank accounts in order to turn their 4500% profit margin.

If there was such a thing as Financial cleansing surely Wonga should be the first to be put up against a wall and shot, thus riding the world of an evil entity which so preys on the mis fortune of the human race. Remember a loan in the hand is worth 6 years of financial ruin in the bush!

[turkwyfe4lyfe]

They will remain on your credit files for 6 years from the date you paid it off.

[orfoster]

I was thinking about this today, haven't you been mis-sold the loan with Wonga? On the basis that they advertised it would improve your credit rating?

[renegadeimp]

They will remain on your credit files for 6 years from the date you paid it off.

 

From the date of entry. Not cleared debt.

[instructor]

If I thought for one second I could address Wonga in this way I would, however at the end of the day I was STUPID enough to be taken in by their advertising and at the end of the day I am responsible for my own actions.

[instructor]

Big 5 say they don't discriminate against potential borrowers, who have previous payday loans. Barclays, RBS, LLoyds, Nationwide and Santander

Despite GE Money’s move five of the largest lenders in the UK have confirmed to Money Marketing that a history of payday loan applications by no means excludes an applicant from obtaining a mortgage.

 

Barclays, Nationwide, Santander, Lloyds and Royal Bank of Scotland all confirmed there was no such policy of automatic exclusion in place. Barclays even went as far as to say that it would calculate mortgage repayments based around outstanding paydadhey loan obligations.

 

Money Marketing published 20/7/13 by Henry Brennan

[orfoster]

Morning,

 

I can't find the article you refer to, do you know where it is?

 

Oli

[instructor]

Morning Oli,

 

You will find article on moneymarketing website full URL http://WWW.moneymarketing.co.uk/mortgages/analysis-big-lenders-dont-exclude-payday-loans/1054552-article. Hope this helps

[instructor]

My most sincere apologies article was dated 2012 but nothing new since then so I would consider policy still the same with these banks

[citizenB]

I am sure I have seen other articles that confirms, even if you repay a PDL on time, it will still have a detrimental affect on your credit rating/scoring as main stream lenders will see it as a sign that the borrower was under pressure at some time.

 

The following was taken from a guardian article

 

 

Payday loans can put credit rating at risk

 

 

However, those who use payday loans to avoid unauthorised overdraft fees could have other problems. The Financial Ombudsman Service told The Observer that while it has had few complaints about the loans, it has seen evidence mortgage lenders discriminate against payday loan borrowers.

 

"The number of complaints we receive about payday loans is relatively low but we have had a number of inquiries from consumers who have been told by their lender that previous payday loans they have taken out – and paid off on time – have and will continue to have a detrimental impact on their credit rating," said a spokesman for the service.

 

Credit reference agency Experian lists payday loans separately rather than including them in a general overview of borrowing history. James Jones, head of consumer affairs for the agency, said that while some lenders do not differentiate between payday loans and other forms of credit, "some high street lenders might see the fact that you've resorted to payday credit as a sign that your finances are under pressure … if a particular lender's experience is that customers who take out payday loans are more likely to miss their repayments, this will be reflected in their credit scoring".

 

 

 

http://www.guardian.co.uk/money/2012/nov/17/payday-loans-credit-rating

[citizenB]

And this one..

 

Wonga: Payday loans 'do wonders' for your credit rating... really?

 

Controversial payday loan firm Wonga has written to customers implying taking out one of its loans can "do wonders" for your credit rating.

 

The reality is often the opposite, as many lenders view the fact you've used a payday or short term loan as a negative, as it can be a sign you're in financial difficulty.

 

 

 

While the Wonga statement doesn't specifically say having a payday loan will help your credit rating, it says if you pay it off, and by implication that you therefore have one, you will benefit.

 

But it fails to mention, or warn customers, that even having a payday loan can make you look unattractive to other lenders.

 

http://www.moneysavingexpert.com/news/loans/2012/11/wonga-payday-loans-do-wonders-for-your-credit-rating

[citizenB]

And this one from another thread on CAG..

 

http://www.consumeractiongroup.co.uk/forum/showthread.php?396982-New-payday-loan-survival-guide-by-mike-dailly-govan-law-centre.&p=4298154&viewfull=1#post4298154

 

 

http://uk.finance.yahoo.com/news/payday-loans-could-cost-mortgage-141535900.html

[instructor]

There is definitely no clear conclusion that can be draw by the average borrower on this issue. What would be beneficial to all is if the lenders made any lend or no lend policy with regards to this subject totally clear on there lending criteria. This would negate borrowers paying fees for mortgage products that they will ultimately not get should the lender have such a no lend policy in place. I have read that mortgage in principle are given, product fee paid by borrower, then Bank says no retaining fees, this too is incorrect and should be addressed or is it another ploy of the banks to get money for nothing?