Author Topic: Payday Loan - Debt  (Read 5131 times)

rpamphlett

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Payday Loan - Debt
« on: Sep 19, 2012, 03:48:32 PM »
I was wondering if anyone could help me or give me some advice.
 
 I am going to default on 2 payday loans at the end of the month, as i haven't got the money to pay them. I have to pay my bills and living expenses and wont have any money left to pay the payday loan companies back.
 
 I owe £500 to Payday Express and £500 to Tooth Fairy Finance.
 
 I have accepted I cannot pay them, and nobody can help me pay them back i.e family & friends.
 
 I am resigned to facing the consequences.
 
 Can someone give me advice on the following?
 
 
  • How will the Payday Loans pursue me?
  • Will they get bailiffs to come to my house?
  • Will they take me to Court?
  • Should I get ready to contact a free charity debt consolidation company to help take the stress away? I understand they will deal with the companies for me?
  • I know i need to pay all my important outgoings first i.e rent. I can afford to pay them a lower monthly re-payment each month, but i am guessing they won't entertain this quite so easily.
     
     
     I need some advice on what will happen and what to expect? Some guidance would be useful. Need Guidance. Trying to get prepared. This is unknown territory especially on the payday loans.
     
     
     Any help and advice would be appreciated?

    Debra

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    Re: Payday Loan - Debt
    « Reply #1 on: Sep 21, 2012, 06:22:50 AM »
    Payday loan debt can be very difficult to manage if you don't repay in full as per the terms of your original agreement. This is because the representative APR of a payday loan can be relatively very high indeed so, if you don't repay your loan on time, interest charges can quickly turn what seemed to be a reasonable short-term solution.

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    mikkilaw

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    Re: Payday Loan - Debt
    « Reply #2 on: Sep 21, 2012, 01:19:32 PM »
    Whilst I am not qualified in this area, I do have personal experience of this type of debt. One option would be to visit your local Citizen's Advice Bureau and see if they can suggest a solution? Perhaps if you contacted both companies before you fail to make the repayments they would at least see that as a gesture of goodwill? Nobody likes unpleasant surprises! If you offered them a monthly affordable figure as a settlement and asked them to reduce or freeze the interest then you have basically done everything in your power under the circumstances. These companies that lend money out short term often do so at ridiculous APRs, the practice is wholly unethical. Do you possess much in the way of assets or equity that you need to protect?

    James Falla

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    Re: Payday Loan - Debt
    « Reply #3 on: Sep 21, 2012, 05:53:20 PM »
    Hi there rpamphlett
    If you do not pay the payday loan companies they will normally pressure you for payment quite hard. However it is unlikely that bailiffs will be sent to your house unless it is an absolutely last resort. These companies are much more likely to hassle you for the money on the phone or with collection letters and the use of debt collection companies first.
    However you should try to resolve the problem. You mentioned that you are renting. Do you owe any other debts? If your total debts are less than £15,000 and you have little or no income to repay them then you might be best considering a debt relief order which would take away the pressure of making payments and leave you debt free after a year.
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    redkite

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    Re: Payday Loan - Debt
    « Reply #4 on: Sep 29, 2012, 10:35:52 PM »
    I think you should prepare for the worst. These companies will almost surely try to raid your bank account when you default. They are not reasonable or caring companies. The website of the Consumer Action Group has lots of info and someone on there will give you useful free advice.   Good luck. e mail me if you need a link.

    James Falla

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    Re: Payday Loan - Debt
    « Reply #5 on: Oct 02, 2012, 04:33:09 PM »
    I agree with redkite that the payday loans will try to take their money from your account. You should contact your bank and instruct them to stop any further payments being taken from your account or debit card from these companies. If you foresee any problem with this then you should open a new bank account and use that from now on. When trying to manage a debt problem the first rule is to protect the money you have from your creditors so you control when payments are made, not them.
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    Steven Jackson

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    Re: Payday Loan - Debt
    « Reply #6 on: Nov 06, 2012, 11:34:34 AM »
    Hello rpamphlett. How are you getting on?
    Some good advice has already been given here. I agree that if you are worried that either of these payday loan companies will try to take money from your bank account, you should call the bank and cancel the payment instructions (which I assume would be taken from your debit card). If necessary then opening a new bank account may be a wise thing to do.
    Of course if you do not pay the debts the PayDay loans will pursue you. They will not instruct bailiffs immediately. Firstly they will hassle you with telephone calls and letters. Eventually they will probably pass your account to a debt collecting company and/or apply for a County Court Judgement against you.
    In terms of the solution, given that you owe less than £15,000 in total and are not a home owner then I think your best option would be to consider a debt relief order as James mentioned. However a debt management plan which will reduce your payments to a managable amount might also work for you. You should certainly speak to an expert to discuss your situation and options.
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