Payday loans

[OverTheBorder]

Pretty much ruined two years of my life, credit unions helped me, will post when at laptop, the industry is so mortally bankrupt it is unreal, got some horror stories! Was actually offered a sky interview to discuss it, couldn't cause of my job

[Jon MW]

There are many other issues with these companies then the apr. the apr is a tax on the desperate/needy/stupid whatever you want to call them. I'd love to discuss the ins and outs of the issues but due to me working for experian I don't think it's a good way to go! The government are not that bothered I would say about the apr.

Question for experian man - if you take out a Wonga loan and pay it back on time, is that seen a positive in the credit score world (loan settled) or a negative (you have used Wonga therefore don't manage your money)?

The reason I ask is whether it is a quick way for a young person to build up a credit history (borrow £100 a few times and pay it back)

Yes it'll count as a positive* - but if you have nothing on your credit history you should be able to get credit anyway.

Even a credit card with terrible interest doesn't charge if you pay every month - so spending a few quid on a credit card every month and paying it off in full will put lots of green marks against your credit file.

After that you'd have a good enough credit score to get stuff with lower interest rates without the need to go anyway near a payday loan company

*unless anyone has any alternative information

[kinboshi]

Comment from twitter in light of discussions on Pay Day Loans and also some on religion in society:

"Wonga and religion are totally different. One preys on desperate and gullible people, manipulating their needs and weaknesses for vast financial gain. And the other is payday loan company."

[EvilPie]

I think I win the highest interest paid on a loan competition.

Worked out about 260000% I think. Someone please correct me if I'm wrong.

I accidentally went 14p overdrawn once and was charged a £1 daily fee until I spotted it and transferred the 14p from another account.

£365 per year for being 14p overdrawn. That's some interest rate but they get around it by calling it a fee.

The culprit: Halifax

They charge daily fees because it makes things 'simpler' for the customer. Absolute bollocks if you ask me. It's just a massive money spinner for the bank.

Minimum APR on a £2k overdraft is 18% if you're permanently at that limit. The lower your overdraft the higher it gets and unless you pay the whole lot off in one go your interest rate keeps increasing the more you manage to pay off. If you go above £2k it's £2 per day.

Why aren't there any complaints about this fee structure?? Seems much worse than anything wonga do if you ask me.

[The Camel]

I hate the big banks far more than pay day loan companies.

[Jon MW]

I think I win the highest interest paid on a loan competition.

Worked out about 260000% I think. Someone please correct me if I'm wrong.

I accidentally went 14p overdrawn once and was charged a £1 daily fee until I spotted it and transferred the 14p from another account.

£365 per year for being 14p overdrawn. That's some interest rate but they get around it by calling it a fee.

The culprit: Halifax

They charge daily fees because it makes things 'simpler' for the customer. Absolute bollocks if you ask me. It's just a massive money spinner for the bank.

Minimum APR on a £2k overdraft is 18% if you're permanently at that limit. The lower your overdraft the higher it gets and unless you pay the whole lot off in one go your interest rate keeps increasing the more you manage to pay off. If you go above £2k it's £2 per day.

Why aren't there any complaints about this fee structure?? Seems much worse than anything wonga do if you ask me.

There are - a lot, and there's been legislation to get rid of the worst examples. But the banks still find other ways.

I know someone who got charged £25 for going 6p over there overdraft limit - but at least that was a one off fee.

[millidonk]

I think I win the highest interest paid on a loan competition.

Worked out about 260000% I think. Someone please correct me if I'm wrong.

I accidentally went 14p overdrawn once and was charged a £1 daily fee until I spotted it and transferred the 14p from another account.

£365 per year for being 14p overdrawn. That's some interest rate but they get around it by calling it a fee.

The culprit: Halifax

They charge daily fees because it makes things 'simpler' for the customer. Absolute bollocks if you ask me. It's just a massive money spinner for the bank.

Minimum APR on a £2k overdraft is 18% if you're permanently at that limit. The lower your overdraft the higher it gets and unless you pay the whole lot off in one go your interest rate keeps increasing the more you manage to pay off. If you go above £2k it's £2 per day.

Why aren't there any complaints about this fee structure?? Seems much worse than anything wonga do if you ask me.

My lloydstsb amount had the same thing but it was £5 a day and capped at 5 days which does seen fair. Surprised Halifax doesn't have a cap tbh.

[bobAlike]

Natwest once stopped a DD of mine for £25 because I only had £24.90 in my account. They charged me £25 for the bounced DD and then charged me £25 for being 10p overdrawn. I did get them to return the fees after a quick phone call though.

[BorntoBubble]

There are many other issues with these companies then the apr. the apr is a tax on the desperate/needy/stupid whatever you want to call them. I'd love to discuss the ins and outs of the issues but due to me working for experian I don't think it's a good way to go! The government are not that bothered I would say about the apr.

Question for experian man - if you take out a Wonga loan and pay it back on time, is that seen a positive in the credit score world (loan settled) or a negative (you have used Wonga therefore don't manage your money)?

The reason I ask is whether it is a quick way for a young person to build up a credit history (borrow £100 a few times and pay it back)

Yes it'll count as a positive* - but if you have nothing on your credit history you should be able to get credit anyway.

Even a credit card with terrible interest doesn't charge if you pay every month - so spending a few quid on a credit card every month and paying it off in full will put lots of green marks against your credit file.

After that you'd have a good enough credit score to get stuff with lower interest rates without the need to go anyway near a payday loan company

*unless anyone has any alternative information

In my opinion its not true. That's how wonga sell it as a benefit, they are bending the truth massively! If you have no credit history get a credit card spend £100 a month on it and pay it off. That will help. Wonga may only be a positive influence if you have a really really really shitty credit rating. Difficult for me to give to much informationt! If you have no credit history do not build up a credit history using wonga etc. just get a store card credit card etc, this will have a positive effect. Cannot really give to much detail for obvious reasons! But happy to give advice to the best of my knowledge on how to get a better score!

Edited a few bits!

[Marky147]

This is how I rebuilt my credit rating http://www.vanquis.co.uk/

[SuuPRlim]

after a vegas trip I accidently sent money back to a different one of my natwest accounts than I thought I had, I then bounced my phonebill, sky, electricity bill, water bill etc, the following month, and I had pretty high monies in my other Natwest current account, they had charged me £415 in fee's by the time I realised and the only reason I noticed was cos our sky got cut off lol.

They ended up paying me it all back, but it took nearly 3 hours of me shouting at them. Matt did Halifax refund you any of that £365?

[EvilPie]

after a vegas trip I accidently sent money back to a different one of my natwest accounts than I thought I had, I then bounced my phonebill, sky, electricity bill, water bill etc, the following month, and I had pretty high monies in my other Natwest current account, they had charged me £415 in fee's by the time I realised and the only reason I noticed was cos our sky got cut off lol.

They ended up paying me it all back, but it took nearly 3 hours of me shouting at them. Matt did Halifax refund you any of that £365?

I didn't actually pay £365, I only paid about £4 because I noticed after a few days.

I was just illustrating that at a daily charge of £1 it's effectively £365 in annual interest on an overdraft of 6p.

[aaron1867]

Considering that we use this forum because we a punters or poker players, seems a bit silly to have a go at payday loan companies who offer a service. Let us remember we see bookies getting put into the most deprived areas of the country, but yet people don't flick an eye lid or bother about it when A bookie goes and sponsors a spots team or similar.

They are in my opinion much worse companies than payday loan companies, if they wasn't there who knows how person A or family A was going to be fed? Yes they are around to get money of the desperate, but I think they are really needed by the desperate too.

I can agree with the notion of the thread for, lots of changes do need to be made for these companies, but really is it the minority? Wonga are now advertising numerous times a day on the biggest advertising channel at Prine time, these are £50k spots, numerous times and also sponsor Newcastle. There must be much more than a minority using these, of course not the majority

[kinboshi]

The proliferation of betting shops has been discussed and criticised on here as well. The advertising of betting sites during football matches is possibly something that should be subject to further regulation. It wasn't that long ago that cigarette manufacturers sponsored sporting events and it was considered normal. Now to many it seems antiquated.

[BorntoBubble]

Considering that we use this forum because we a punters or poker players, seems a bit silly to have a go at payday loan companies who offer a service. Let us remember we see bookies getting put into the most deprived areas of the country, but yet people don't flick an eye lid or bother about it when A bookie goes and sponsors a spots team or similar.

They are in my opinion much worse companies than payday loan companies, if they wasn't there who knows how person A or family A was going to be fed? Yes they are around to get money of the desperate, but I think they are really needed by the desperate too.

I can agree with the notion of the thread for, lots of changes do need to be made for these companies, but really is it the minority? Wonga are now advertising numerous times a day on the biggest advertising channel at Prine time, these are £50k spots, numerous times and also sponsor Newcastle. There must be much more than a minority using these, of course not the majority

Wonga have a massive market share in an industry that's valued between 2-4 billion a year they are raking it in obviously prime time tv is a popular activity of there customer base! For some people it is a good solution. If you have a shorty credit rating and have an unexpected bill 5 days before payday it may be the best solution for you but in most cases people just roll over their loans every month therefore making these companies a fortune!