What are Payday Loans?
Payday loans are a form of short term, high interest, non-priority credit, which is designed to be repaid from your next wage. However, they are often missed – we would never recommend this avenue as a solution to longer term lending due to the APR charged.
What laws and regulations are these loans based on?
The Financial Regulation Authority regulates lenders (FCA), are subject to the Consumer Credit Act 1974 and 2006 and have a licence from the UK Office of Fair Trading. Statistics regarding payday loans may be found on the FCA website.
If I am struggling to pay?
If you are struggling to pay, you should call the lender. Sometimes they may offer to “help you out” by providing more money at a lower APR. This, however, may be designed to increase your total level of debt. If you have taken out such a loan, we suggest you speak to a lender with a more reasonable APR, such as a bank or building society. Remember, they are a business that exists on interest, which ultimately they will aim to get from you.
Continuous Payment Authority (CPA) – how do I stop these payments?
CPAs allow lenders to take payments from your accounts to pay off the loan. You may stop CPAs by either writing to the loan company or the bank where the payments are taken. However, you will still need to pay off the loan eventually. For further support, contact Citizens Advice which provides free support. At Lestons, we also offer services of support; these services are all provided. You can find out more about our services and pricing at x.
Can I get a refund on my loan?
There are limited circumstances in which people can gain a refund on their loan – these are where the lender has not acted responsibly. In this context, it means that they lent you money without first checking whether you can repay the loan. If this is the case, you may be undergoing ‘undue difficulty’ and may be entitled to a full or partial refund. If you feel the lender has acted unreasonably, then write to the Financial Ombudsman Service giving much detail as possible. This may include situations such as:
♦ You have had to take another loan to pay off the previous payday loan,
♦ You have had to take out bigger repayment loans,
♦ You have not paid an important household bill to repay the payday loan,
♦ You have managed to pay the loan by not buying enough food that month
How we can help
Lestons can mediate with your lender to try and seek a working solution, these may include:
♦ Lowering the payments or interest rate
♦ Accepting reduced repayments for a set period
♦ Agreeing to a payment “holiday”
♦ Refinancing your loan somewhere else
In certain situations a complete examination of your financial situation may be required, we have access to solutions that include liaising with a host of independent, professional financial advisors who can give you great advice, we do not charge for this service itself but do charge for our time in creating the proposal and briefing documents. To create a case so that we can liaise with you over your needs just click the link at the top of this page, our staff are ready and eager to assist you in any way possible.
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