That is what my opinion of these Payday Loan companies is. And it is so easy to fall into the trap of borrowing from these types of firms without realising how much debt you are actually getting yourself into.
Payday loans.. yes we keep seeing the ads on our TV’s and in the papers… which tell us if you are hard-up and you want money desperately then contact so and so and have a payday loan. Yep without questions asked they will offer you what you need, pay it in your bank within a few minutes and then let you have a lifetime of worry.
When you are desperate for spare cash, and don’t have family you can turn to or friends that could help, is is so easy to turn to one of these Payday Loans companies. Especially if something unexpected crops up… like a garage bill or money needed to repair a kitchen appliance. And some of these Payday loans have been have been taken out simply because people didn’t have the money for Christmas.
Today in the Metro, I was reading a tragic Story about Antony Breeze, who was so worried about his financial situation.. and how he was going to payback the money he had borrowed, along with trying to fund a wedding and another child, that he decided the only alternative was to kill himself.
How desperate he must have been to even contemplate suicide yet alone carry it out. Dousing yourself in Petrol and setting light to yourself, must be one of the most painfullest ways of committing suicide..
His partner Ms Lowe, told the coroner:
‘His phone never stopped ringing, he wouldn’t tell me who it was. He went into the bathroom, I didn’t know who it was.
‘I can’t understand why he did it.’
Mr Walsh, the Deputy Coroner said this:
‘He was anxious to provide for his partner and his daughter… and was a man who had everything to live for.
Money is a natural concern of any family man and father at some point, but Mr Breeze’s debts were not at a very high level. Therefore, I cannot understand why his debts would lead him to harm himself.’
But Mr Breeze is not the only person to fall foul of PayDay Loan Companies… according to the Sun one client of a Payday Loan company borrowed £150 and is now £10K in debt.
Luke Martin told the Sun, in December 2012, the following:
I desperately tried to arrange a repayment plan based on my earnings so I could pay back an affordable amount each month. But whatever I suggested they demanded double.
At my wits’ end, I had no choice but to pawn my belongings.
My parents wondered why I was always ‘losing’ my phone and why I’d suddenly lost interest with my games console and computer. The truth was I’d sold everything apart from the clothes on my back but I didn’t want them to know. By early 2010, things had turned really ugly. I was borrowing from Payday Express, QuickQuid, Wonga, Cash Genie, 247Moneybox, Speedy Dosh and Mobile Quid, to name a few.
Every day I’d receive dozens of threatening emails, phone calls and texts. I could no longer hide the truth from my parents as the lenders started calling the house phone ten times a day, asking for me.
In another story a 34 year old woman, named Sandra Hopkins, started out borrowing £100 and found herself saddled with a £3,500 debt.
Via MoneySupermarket.com I took a look at payday loans and was absolutely flabberghated as the extortionate rates being given.. with Wonga having a Typical APR of 4214%
So I went to Wonga and decided to put in those figures, £100 borrowed over 15 days..
So for just over two weeks of borrowing £100 I have to pay them back an extra £21.11 … that is over 20% of what I borrowed… and they make things look so enticing don’t they, especially if you are desperate to get some cash.. And if you need cash there and then.. they even offer to put the money in within 23 minutes..
At the time of writing this post 8.44 am, Wonga was telling me that they could put £400 in my bank by 9.07 am.
And do you know what, things are only going to get worse for people.. you see with this new bedroom tax that has been introduced.. families on minimum wages, with spare bedrooms are going to have to find the extra rent as their housing benefit is going to be cut.. It is only inevitable that people when faced with finding extra rent which they can ill afford are going to turn to the likes of Payday Loan companies.
Back in March the Office of Fair Trading told these companies to clean up their act or lose their licence. Mind you, by the OFT taking such action does rather put David Cameron and his Tory party in a bit of jam, doesn’t it? The Daily Mail reports:
The fact that Wonga is among the loan firms savaged by the OFT could embarrass David Cameron and the Conservative Party.
The firm paid thousands of pounds for the right to have face-to-face lobbying time with senior Conservative politicians at the party’s annual conference in Birmingham last year.
Later a member of the Prime Minister’s inner circle, his digital adviser Jonathan Luff, joined Wonga, which has been lobbying against calls from some consumer groups for a cap on the industry’s sky-high interest rates. Yesterday’s announcement that there would be no such cap was ‘broadly welcomed’ by Wonga.
You see what some MP’s were calling for was a cap on the amount of interest that could be charged.. and when David Cameron was quizzed about this he said:
“Without an effective regulated sector, there are far more dangers from loan sharks.”
Yes Payday loans are a vicious circle….