Professionals using payday loans

[enaid]

Even the plastic millionaires as I call 'em are feeling the pinch


One in 14 applicants for high-interest payday loans are professionals in well-paid jobs such as doctors, lawyers and accountants, a study has shown.
Short-term online lender FridayFriday.com said 7% of payday loan applications last year came from people commanding generous salaries.
White collar workers made up half of those applying for the 35-day loan service, in which people borrow between £100 and £1,000 to tide them over until their next pay packet arrives.
Of those white collar applicants, 28% worked in management, with more than a quarter (26%) holding down jobs in sales and marketing.
FridayFriday.com founder Jason Gardiner said the analysis contradicted the traditionally view that payday loans are only used by the low-paid or jobless.
Mr Gardiner said: "Seven per cent of applicants are in high-end professions such as law, accountancy and medicine and this just goes to show that, regardless of your income, there can be times when people need a short-term loan to see them through until their next pay day.
"People we've spoken to in these professions have stated that typically they've applied for a short-term loan due to an unforeseen cost increase, something which can happen to anyone regardless of the size of their salary. Half of all applicants are from white collar backgrounds, including managers, salesmen and marketers, which reinforces just how widespread payday loaning is becoming."
Consumer Focus figures indicate that the payday loans market increased from 300,000 borrowers in 2006 to 1.9 million in 2010.
The industry has been accused of preying on those in financial trouble, prompting the Office of Fair Trading (OFT) to investigate whether some firms target people unsuitable for credit and are rolling over loans so that the charges escalate and they become unaffordable.
Payday lenders argue that they offer a much-needed service to customers and their high-interest charges are often more transparent than those of mainstream banks.




http://uk.news.yahoo.com/professionals-using-payday-loans-015418779.html

[Guest]

Re: Professionals using payday loans

Typical smokescreen tactics, it may well be true that some high earners use these "services" but they do so for convenience, and more importantly they can afford the interest it is an option, not the last resort.

The point is that even on these figures 93% use these loans as a means of managing their everyday finances. A recipe for disaster.

There is a big difference, someone who cant pay there monthly gas bill and borrows from these companies can look forward to having to find not only the next monthly bill but the interest on the loan.

The OFT are supposed to be looking into the way that these are advertised but are dragging their feet.
You don't see these advertised in the Guardian, the Times or the Lancet they are on day time TV and target the social demographic that consist of the population on or just below the poverty line.

D

[Jewel Halgryn]

Re: Professionals using payday loans

Payday Loan Advice

Payday Loans are notorious for attracting negative press, however, they aren’t as complicated as they seem. Below we have compiled a list of factors and advice that can help you get the best out of your Payday Loan.
Choose the right Payday Lender

To get the best deal on your Payday Loan, it’s important to research the different lenders out there. Rates vary dramatically so it’s worth checking. Remember to factor in; how long you’re planning on taking the Loan out for and the amount you’re going to borrow when researching each Lender.
Do you definitely need to borrow?

This may seem like an obvious question but it’s worth exhausting all other alternatives. Payday Loans aren’t designed to be used for luxury spending. Only you can decide if you need the Loan but you should ask yourself this question each time you borrow.
Understanding all the small print

Each Payday Lender will have different terms and conditions. It’s important to understand what you’re signing before you borrow from any Lender. One of the most important things to look out for is the repayment date. At Cash Genie we realise that life can be hectic and sometimes people forget things; because of this we send our customers a text 72 hours prior to their repayment due date to help them remember. You should also know how and when your payment will be taken. If you have any questions about the Loan agreement, you should contact the Lender directly before taking out the Loan.
Only borrow one Loan at a time

Payday Loans can help people when their paydays seem a stretch away and they need cash fast. Sometimes there will be restrictions on the amount you can borrow. However, with Cash Genie, you can improve your trust rating by repaying your Loan on time; correct repayment can also lead to an increased loan amount the next time you borrow. Restrictions on the amount you can borrow are there for a reason. Always avoid borrowing more than one Loan at a time as this may result in repayment problems.
Understanding the APR (Annual Percentage Rate)

APR stands for Annual Percentage Rate. This figure shows how much each loan will accumulate in the space of one year. In the UK, all Lenders must display their APR so make sure that it is clearly visible. Many Payday Lenders appear to have ridiculously high APR’s, but this is because Payday Loans aren’t ever paid over a full year. Most Payday Lenders charge for a set amount over a short period of time, therefore the APR will always appear higher.
The Responsibility of the Lender

Most Lenders, like Cash Genie, will only allow you to borrow a certain percentage of your salary. This restriction is in place to prevent you from encountering problems with repayments. If you think you’re going to miss a payment make sure you call the Lender to let them know, prior to your repayment due date.
Avoid upfront fees

No responsible Payday Lender will ever ask you to give them money upfront before you receive the loan. If for some reason a fee is required it’s likely you will be in contact with a broker who cannot guarantee you a loan. It’s best to deal solely with Lenders for Payday Loans.
Who regulates Payday Lenders?

Currently there is no single body that regulates Payday Loan companies. However, all Lenders must have a Consumer Credit Licence (CCL). Before you take out a loan check that the Lender is approved by an industry body; such as the Finance and Leasing Association or Consumer Finance Association. Also, make sure that the Payday Lender conforms to the (OFT) Office of Fair Trading’s Responsible Lending Guidelines.
Never take out a Loan on behalf of someone else

You may be surprised with how common it is to see people taking out a payday loan for others. Don’t do it!
Overlook criticism from online forums

In general, people will only share their views about a product or service if it’s exceptionally good or bad. There seems to be a stigma attached to payday loans, which encourages people who have had a pleasant experience not to voice their opinion. Many customers who do find Payday loans helpful and who do receive a good service; would rather not tell the world that they would or have taken out emergency finance. If you do see an overly negative review from someone who has taken out loan, ask yourself if they would have benefitted from any of the advice on this blog. Did they do all they could to ensure the process went smoothly?

[Guest]

Re: Professionals using payday loans

Payday Loan Advice

Payday Loans are notorious for attracting negative press, however, they aren’t as complicated as they seem. Below we have compiled a list of factors and advice that can help you get the best out of your Payday Loan.
Choose the right Payday Lender

Payday loans attract, "negative press" fort a variety of reasons, none of which is because they are "complicated"

To get the best deal on your Payday Loan, it’s important to research the different lenders out there. Rates vary dramatically so it’s worth checking. Remember to factor in; how long you’re planning on taking the Loan out for and the amount you’re going to borrow when researching each Lender.
Do you definitely need to borrow?

Beter still to consider that you will have to repay in the region of 3000% APR on whatever you borrow, and irrespective of the company you chose they will encourage further indebtedness.

This may seem like an obvious question but it’s worth exhausting all other alternatives. Payday Loans aren’t designed to be used for luxury spending. Only you can decide if you need the Loan but you should ask yourself this question each time you borrow.

No they are designed to profit from those who are already in financial dire straights
Understanding all the small print

Each Payday Lender will have different terms and conditions. It’s important to understand what you’re signing before you borrow from any Lender. One of the most important things to look out for is the repayment date. At Cash Genie we realise that life can be hectic and sometimes people forget things; because of this we send our customers a text 72 hours prior to their repayment due date to help them remember. You should also know how and when your payment will be taken. If you have any questions about the Loan agreement, you should contact the Lender directly before taking out the Loan.
Only borrow one Loan at a time

We know very well what you at Cash Genie do

Payday Loans can help people when their paydays seem a stretch away and they need cash fast. Sometimes there will be restrictions on the amount you can borrow. However, with Cash Genie, you can improve your trust rating by repaying your Loan on time; correct repayment can also lead to an increased loan amount the next time you borrow. Restrictions on the amount you can borrow are there for a reason. Always avoid borrowing more than one Loan at a time as this may result in repayment problems.
Understanding the APR (Annual Percentage Rate)

Problem is that the same problems are still there when your loan and inflated interest becomes due, as you well know.

APR stands for Annual Percentage Rate. This figure shows how much each loan will accumulate in the space of one year. In the UK, all Lenders must display their APR so make sure that it is clearly visible. Many Payday Lenders appear to have ridiculously high APR’s, but this is because Payday Loans aren’t ever paid over a full year. Most Payday Lenders charge for a set amount over a short period of time, therefore the APR will always appear higher.
The Responsibility of the Lender

On £100 loan the average PDL company will charge £25-£30, don't need to be a genius in APR calculation to see that this is exorbitant.

Most Lenders, like Cash Genie, will only allow you to borrow a certain percentage of your salary. This restriction is in place to prevent you from encountering problems with repayments. If you think you’re going to miss a payment make sure you call the Lender to let them know, prior to your repayment due date.
Avoid upfront fees

Also gives access to the debtors employer which comes in handy when they want to apply pressure if a payment is missed.

No responsible Payday Lender will ever ask you to give them money upfront before you receive the loan. If for some reason a fee is required it’s likely you will be in contact with a broker who cannot guarantee you a loan. It’s best to deal solely with Lenders for Payday Loans.
Who regulates Payday Lenders?

Better still if they were banned
Currently there is no single body that regulates Payday Loan companies. However, all Lenders must have a Consumer Credit Licence (CCL). Before you take out a loan check that the Lender is approved by an industry body; such as the Finance and Leasing Association or Consumer Finance Association. Also, make sure that the Payday Lender conforms to the (OFT) Office of Fair Trading’s Responsible Lending Guidelines.
Never take out a Loan on behalf of someone else

PDL are regulated by the CCA and the OFT, although this regulation is inadequate, the trade associations are toothless and have been proven to be ineffective in consumer disputes
You may be surprised with how common it is to see people taking out a payday loan for others. Don’t do it!
Overlook criticism from online forums

In general, people will only share their views about a product or service if it’s exceptionally good or bad. There seems to be a stigma attached to payday loans, which encourages people who have had a pleasant experience not to voice their opinion. Many customers who do find Payday loans helpful and who do receive a good service; would rather not tell the world that they would or have taken out emergency finance. If you do see an overly negative review from someone who has taken out loan, ask yourself if they would have benefitted from any of the advice on this blog. Did they do all they could to ensure the process went smoothly?

Any benefits from these services is outweighed a hundred fold by the harm that they do to the financially vulnerable in our society, and despite what is said here, we all know that this is the demographic these companies target.

D

[Shadowcat]

Re: Professionals using payday loans

People will end up relying on the state because of ridiculous interest rates, it affects the country massively. We're at the stage where working all our lives appears to have achieved nothing, with Swift (Barclays) after our house.
We will need the state's help when we retire, our assets will have been long stripped because of no regulation to sort out the greed that is out of control.