Pay Day Loans

[lavrentis]

They are horrible in terms of ethics but if people still use them you can't blame the actual companies etc. Wonga etc are pretty upfront about their costs. Blame the culture of the people who use them.

[Sir Fynwy]

Well if you're suggesting the government should have proactively regulated the likes of wonga before they even existed on the basis that a form of loan shark did already exist then OK. Not quite sure how you expect that to have worked, but OK. Maybe in that case labour should have set up the proactive regulations? We all know about their recent track record when it comes to banking sector regulation, of course. Flawless.

I'm willing to bet the proposed regulations will come into force as planned in January and if there is any watering down, it will be minor, and will be intended to mitigate the risk of people getting themselves in more trouble in the illegal market.

Previous governments relaxed laws which allowed the payday loans companies to come into existence. I really don't understand your attacks on me politically, I haven't stated a preference and I will tell you I haven't voted labour for a long time, my dad was friends with Lord Heseltine and a senior member of his local conservative association.

A lot of the people getting in to trouble with payday loans are the working poor who have been the main group under attack in this parliament.

[Alex_LCFC]

Im sure i heard on the news last year that wonga made like 80 million pound profit last year. Says it all really

[lavrentis]

Im sure i heard on the news last year that wonga made like 80 million pound profit last year. Says it all really

 

And fair play to Wonga for cashing in on the idiots of the nation.

 

Shame on the people who give Wonga money, Wonga is not to blame here, even with their old people adverts

[Sir Fynwy]

And fair play to Wonga for cashing in on the idiots of the nation.

Shame on the people who give Wonga money, Wonga is not to blame here, even with their old people adverts

You do realise that we all end up paying higher interest rates for our loans and having our property values hit because of the defaults? Wonga and their like tipping people on the edge over it isn't good for anyone except their shareholders. There are some very misinformed comments in this thread.

[Rincewind]

Yes there are idiots who use them just to carry on a lifestyle they cannot afford but there are also those of a low IQ, educational standard or may come from a background where they have not learned the value of money. For instance care homes. Even some that are leaving the army. They would have joined straight from school and are in an environment where everything is done for them. Those leaving prison will not have learned while inside. I am not defending those that spend their money on play stations gadgets Sky TV etc leaving little for essentials. Even if told they may not change their ways. I am referring to those that face a situation where they are in financial trouble because of events that have happened in their life be it job loss relationship break down or illness. Some people just leave it too late before seeking help thinking there is light at the end of the tunnel and their situation will improve.

[Haydos]

You do realise that we all end up paying higher interest rates for our loans and having our property values hit because of the defaults? Wonga and their like tipping people on the edge over it isn't good for anyone except their shareholders. There are some very misinformed comments in this thread.

 

It doesn't change the fact that people who use them irresponsibly are idiots.

[Rincewind]

It doesn't change the fact that people who use them irresponsibly are idiots.

Not very fair though to target the vulnerable who may not understand what the outcome maybe. The idiots as you refer to should know  better but it is not always them that suffer the most. They may be idiots but they are could not care less clever idiots. Where the desperate are near rock bottom. They are being chased for paybacks whereas the 'clever idiots' know that if they pay some back it will keep the lenders quiet until the next payment or loan. The lenders make their money off the most vulnerable.

[MooseBreath]

Previous governments relaxed laws which allowed the payday loans companies to come into existence. I really don't understand your attacks on me politically, I haven't stated a preference and I will tell you I haven't voted labour for a long time, my dad was friends with Lord Heseltine and a senior member of his local conservative association.

A lot of the people getting in to trouble with payday loans are the working poor who have been the main group under attack in this parliament.

My apologies, I assumed you were anti-tory given your baseless criticism of them earlier in the thread and other comments you've made elsewhere. Your final paragraph here - another baseless criticism - would seem to confirm it.

[Julian Joachim Jr Shabadoo]

The thing with pay day lenders is they are so blatantly a rip off, they don't even need to hide it - it's like smoking. It's such common knowledge that it's bad for you, if you are to smoke and then complain about the health implications, you're an idiot. If you are to use a loan company that charge 2000% APR then moan that the repayments are too expensive (despite them openly telling you upfront exactly what you're paying back), you're an idiot. If you are genuinely vulnerable, then you should be under the care of a more responsible person and not be allowed access to such services, but that's a different matter entirely.

 

If you ban things like this, there are always illegal alternatives. Why not just let people have a freedom of choice? Don't worry about them. Unless the pay day lenders are guilty of any actual illegal practices, just let everyone get on with it.

[Rincewind]

The thing with pay day lenders is they are so blatantly a rip off, they don't even need to hide it - it's like smoking. It's such common knowledge that it's bad for you, if you are to smoke and then complain about the health implications, you're an idiot. If you are to use a loan company that charge 2000% APR then moan that the repayments are too expensive (despite them openly telling you upfront exactly what you're paying back), you're an idiot. If you are genuinely vulnerable, then you should be under the care of a more responsible person and not be allowed access to such services, but that's a different matter entirely.

 

If you ban things like this, there are always illegal alternatives. Why not just let people have a freedom of choice? Don't worry about them. Unless the pay day lenders are guilty of any actual illegal practices, just let everyone get on with it.

I am not disagreeing with a lot of that but services like carers have been cut drastically plus if someone has a mental breakdown their condition may not be apparent  if they keep it hidden. Not all disabilities are visible.

 

Moose are you saying the less well off do not take out these loans? Research and stats have proven a rise in the use of them by workers on lower wages in the past couple of years and the increase of loan shops opening.

Can you prove there has not been an increase in these kind of shops?

[Julian Joachim Jr Shabadoo]

I am not disagreeing with a lot of that but services like carers have been cut drastically plus if someone has a mental breakdown their condition may not be apparent  if they keep it hidden. Not all disabilities are visible.

 

That's not for pay day lenders to worry about at all. Much like the dog poo problem in my village is not for Wonga to worry about. Or the ebola breakout.

 

The signs of a mental breakdown aren't always obvious but these are unfortunate (and rare) cases, and someone in this case is capable of doing many things which technically are legal and where mental illness probably wouldn't be screened for, but wouldn't be recommended for someone of an unsound mind.

 

Let's say someone loses the plot and jumps off a bridge. Do we then hound the architect who designed the bridge and say he is responsible for someone's death? No. You say someone went bananas and misused a bridge. It's unfortunate but sometimes people do things they shouldn't, it's part of the world we live in.

 

A pay day lender outlines everything in the advert. It is designed for a quick cash injection. Say you need £1,000 to fix a boiler, you currently don't have the money but you are definitely getting paid in a week. You take the £1,000, fix the boiler, pay back £1,050 the following week and you're clear. That's how it's intended to work. If you misuse the product, you're an idiot. If you're not of sound mind and not under the care of a responsible adult, that's unfortunate.

[MooseBreath]

Moose are you saying the less well off do not take out these loans? Research and stats have proven a rise in the use of them by workers on lower wages in the past couple of years and the increase of loan shops opening.

Can you prove there has not been an increase in these kind of shops?

No, that's not what I'm saying. I was disagreeing with his point regarding the working poor being "the main group under attack". Clearly "attack" is an absurd word to use but if we're talking about groups who have been most negatively effected by the economy and government policy recently then by all accounts that would be the 'squeezed middle'. Those at the lower end have benefitted tremendously from huge increases in employment and being taken almost entirely out of income tax.

[Haydos]

The thing with pay day lenders is they are so blatantly a rip off, they don't even need to hide it - it's like smoking. It's such common knowledge that it's bad for you, if you are to smoke and then complain about the health implications, you're an idiot. If you are to use a loan company that charge 2000% APR then moan that the repayments are too expensive (despite them openly telling you upfront exactly what you're paying back), you're an idiot. If you are genuinely vulnerable, then you should be under the care of a more responsible person and not be allowed access to such services, but that's a different matter entirely.

 

If you ban things like this, there are always illegal alternatives. Why not just let people have a freedom of choice? Don't worry about them. Unless the pay day lenders are guilty of any actual illegal practices, just let everyone get on with it.

 

Voice of reason. Regulating them is fine, making them illegal is just mollycoddling people that already don't face up to their responsibilities and don't think they should be help to account for making the wrong decisions.

 

I'm pretty sure most people that take out these loans who can't afford them know full well they can't and there's no way they can be ignorant of the consequences. They do it because they have no self control and it will prolong having actual responsibility.

[Sir Fynwy]

Voice of reason. Regulating them is fine, making them illegal is just mollycoddling people that already don't face up to their responsibilities and don't think they should be help to account for making the wrong decisions.

I'm pretty sure most people that take out these loans who can't afford them know full well they can't and there's no way they can be ignorant of the consequences. They do it because they have no self control and it will prolong having actual responsibility.

Have you done any research? I know of professional people who are having possession orders put on their property by the courts because they have lost control of their finances due to payday loans, these are educated people who you wouldn't expect to be so bad with money, the houses on our estate have been seriously devalued because several have been repossessed and sold at very low prices, these are 5 and 6 bed executive homes.

Oh and in answer to the Moose, lots of low paid, part-time and zero hour contracts at the bottom end don't mean that they are feeling great. The left is as much at fault for this as the right. Ideology is used by all politicians to obfuscate.

[absolutelegend]

People need to take more personal responsibility - if you know you can't afford to pay the money back quickly, don't take out this kind of loan.  End of.

[Haydos]

Have you done any research? I know of professional people who are having possession orders put on their property by the courts because they have lost control of their finances due to payday loans, these are educated people who you wouldn't expect to be so bad with money, the houses on our estate have been seriously devalued because several have been repossessed and sold at very low prices, these are 5 and 6 bed executive homes.

Oh and in answer to the Moose, lots of low paid, part-time and zero hour contracts at the bottom end don't mean that they are feeling great. The left is as much at fault for this as the right. Ideology is used by all politicians to obfuscate.

 

I've not done any research, no. What you're mentioning doesn't have much to do with my point though. I'm not sure if it's because of how I was raised or some other factor but I don't think you should borrow money you cannot afford. As far as I'm aware when you apply for a loan, you select an amount and a time to borrow it for.

 

Now, here is my point: If you don't know for absolute certain that you are going to have enough money to pay the loan back on the agreed date you shouldn't even consider the loan. If you have a bonus coming up in 2 weeks and you could do with a bit extra for something until then, fair enough. If you have no other changes to your financial situation and have no extra funds to pay it off with then that is your fault and you need to take responsibility for that. Being bad with money is not an excuse, spend what you can afford, it's that simple. If you lose your job and can't afford repayments of a pre-agree loan then I have sympathy but if you take one out because you lost your job then I'm sorry, that's ridiculous.

 

Does you agree/disagree with that or is there something I'm missing?

[Sir Fynwy]

I've not done any research, no. What you're mentioning doesn't have much to do with my point though. I'm not sure if it's because of how I was raised or some other factor but I don't think you should borrow money you cannot afford. As far as I'm aware when you apply for a loan, you select an amount and a time to borrow it for.

Now, here is my point: If you don't know for absolute certain that you are going to have enough money to pay the loan back on the agreed date you shouldn't even consider the loan. If you have a bonus coming up in 2 weeks and you could do with a bit extra for something until then, fair enough. If you have no other changes to your financial situation and have no extra funds to pay it off with then that is your fault and you need to take responsibility for that. Being bad with money is not an excuse, spend what you can afford, it's that simple. If you lose your job and can't afford repayments of a pre-agree loan then I have sympathy but if you take one out because you lost your job then I'm sorry, that's ridiculous.

Does you agree/disagree with that or is there something I'm missing?

If you saw some of the cases my wife takes to court for the banks you'd understand how naive your analysis is, people often don't have enough warning of changes in circumstances to make adjustments to their plans and in a slow property market (which we still have except for first time buyers and some hotspots like London) selling property to downsize isn't a reliable option.

I'd never touch a payday loan but desperate people do and they aren't all the stereotypical clients.

[Rincewind]

Those businessmen were probably only intending to take the loans out for a short while then a lost order here and there sent them in a downward spin. Along with low paid jobs and zero hour contracts there is an increase in sanctions so they are not counted as unemployed even though those part time low paid a zero hour are still claiming benefit. The BT has left some with a 25% reduction in income and falling behind with bills. There has been an increase in emergency payments. A reduction in income may cause the person to look elsewhere to make up the difference whether they are on 100 or 500 pw. Maybe those business

people thought like a lot of people do. My job is safe, this downfall is only temporary things will be better next month a payday loan will tie me over until then. Then a bounced cheque or two another loan until things improve etc etc.  It happens to rich and poor.We do not know what is around the corner. We can prepare for a rainy day but nobody expects a typhoon.

It is very hard for some people to admit that they are in trouble and seek advice. They feel ashamed for not getting in the situation. being called idiots and morons will not help matters. They will feel as if they have let their family down by not providing better for them. This is human nature.  C'est la vie.

[Rincewind]

People need to take more personal responsibility - if you know you can't afford to pay the money back quickly, don't take out this kind of loan.  End of.

There are more than two colours in a rainbow and they don't include black and white/

[absolutelegend]

There are more than two colours in a rainbow and they don't include black and white/

Not sure what you mean? People shouldn't have personal responsibility for their considered actions?

[Steve_Guppy_Left_Foot]

Pretty cut and dry for me. Fvcking disgusting companies and anyone involved with them should be thoroughly ashamed. Not run properly, plenty of MP's in with this lot in the name of capitalism as well, vile tits. Newcastle should be liquidated. End.

[Rincewind]

Not sure what you mean? People shouldn't have personal responsibility for their considered actions?

Yes they should if they are able but not every person has the same reason for taking one out. 50 shades of grey and all that.

There is a difference between taking one out just to increase your  possessions of fancy goods gadgets and luxuries just to show off to friends and family to taking one out in desperation and to survive or stop the mortgage lenders repossessing your house.

The first are irresponsible, the second are exploited because of their situation. The first will just pay a little off a month for the rest of their lives if their luck lasts.

[Haydos]

If you saw some of the cases my wife takes to court for the banks you'd understand how naive your analysis is, people often don't have enough warning of changes in circumstances to make adjustments to their plans and in a slow property market (which we still have except for first time buyers and some hotspots like London) selling property to downsize isn't a reliable option.

I'd never touch a payday loan but desperate people do and they aren't all the stereotypical clients.

 

Is there any reason these people aren't taking out actual loans with banks then? I work for a bank and exposure to people not managing finances responsibly just irks me.

 

'Stereotypical clients' doesn't even come into it, I don't care who takes them out, they're well known to be the worst option for solving any sort of financial problems you have. It's not an option, it's a PAYDAY loan. It's like fat people or smokers blaming shops for selling them the cause of their problems.

[James.]

Is there any reason these people aren't taking out actual loans with banks then? I work for a bank and exposure to people not managing finances responsibly just irks me.

 

I'm surprised that you work for a bank and yet still ask that question...