Help please with Payday loans

[Yoda]

My daughters boyfreind has a payday loan which he borrowed £360. He can only afford to pay £90 per mointh back but the interest is taking all this up, so nothing is coming off the capital. Is there any way to stop the interest going on?

[mr.ton]

Re: Help please with Payday loans

Prob no way to stop it but a line has to be drawn in the sand somewhere.
Only repay what can be afforded - if that be £1 per month then so be it.
Have the payday company reported to the OFT as well.

[labman]

Re: Help please with Payday loans

Which loan company did he use?

[Yoda]

Re: Help please with Payday loans

Payday Express

[labman]

Re: Help please with Payday loans

Payday loan companies are unlikely to take you to court. The most important thing is to stop the downward spiral - if this means writing and saying they cannot afford to pay, so be it.

The debt would be passed to a DCA eventually, and it would be much more feasible to negotiate a repayment plan with them based on the actual amount owed, rather than ridiculously inflated fees.

If they insist on you paying the interest, report them to every body you can.

The best thing to do is to open a new account with a different bank (because of the authorisation for a recurring payment, this can carry over to a new card or new account with the same bank). Pay your money into that and set up a proper DMP for repayment.

It is a very tricky area, and a difficult problem to get out of because of the authorised recurring payment. The only thing to do is to break the cycle. I know the above may sound drastic, but it really is the only really safe way to ensure priority debts are paid first, and non-priority debts (like payday loans) are put in their correct place in the pecking order on your money.

[CleverClogs]

Re: Help please with Payday loans

My daughters boyfreind has a payday loan which he borrowed £360. He can only afford to pay £90 per mointh back but the interest is taking all this up, so nothing is coming off the capital. Is there any way to stop the interest going on?

The Jedi mind trick on their evil minds does not work?

Hmm.

Reminding them of the retort in Arkell v Pressdram (link) is the best thing he can do and stop paying them he must. The debt to a debt collection company must be sold, as they much easier to deal with will be.

[labman]

Re: Help please with Payday loans

It's important to do the change of bank account though, otherwise the PDL company will keep requesting amounts until they empty the account, and have been known to repeatedly set up Direct Debits, even though debtors keep cancelling them.

Breaking the authority for the recurring payment is critical. :beagle:

[lindalou]

Re: Help please with Payday loans

HI
New here so I hope you don’t mind me chipping in.
I had a pay day loan(wonga) and they virtually cleared my account out, just like Labman said.
I protested to the bank and they said I could dispute the authority but it may take up to six months to resolve, and if I had given them permission to draw on the account it would be unlikely that I would get my money back.
I opened a cash minder account t the coop and transferred all my incomes and outgoings there.
LL

[Yoda]

Re: Help please with Payday loans

Reminding them of the retort in Arkell v Pressdram

Very funny thanks

[burmacat]

Re: Help please with Payday loans

Hello

I am new to this forum but am in need of urgent help.

I am currently fighting Cash Genie - just been through mediation and the £628 they are requesting, they say they will accept an out of court settlement of £300 to be paid in £50 installments.

How ever they have had £429 in roll over fees over 11 months plus they took an unauthorised payment of £142 from my account last year.

The loan was originally £150 plus £45 interest. So as you can see I have already paid more than this back in charges and interest.

I have just found out i am pregnant so all this worry is not doing me much good. I dont know whether to accept the offer of £300 or go to court in March?

My mediator advised that if I lose I could have to pay up to £800 in charges etc. and that if I cant pay it in one lump sum then I will have a CCJ on my name.

In a right pickle and need to give my decision today.

Help will be very very much appreciated

[labman]

Re: Help please with Payday loans

There is a VERY new piece of legislation giving permission for you to cancel a recurring payment authority with your bank. I don't know anyone who has done it yet, but the facility is there, so your bank should have to refund anything they pay out now.

Personally I'd still play safe, but I always err on the side of caution.

As regards your situation, have they actually issued court papers, or is this a threat at present?