PayDay Loans ?!

[N_N_R]

Here I am with another overall forum off-topic topic

I've just recently come across some YT videos about this kinda business in the UK and couldn't stop thinking...... WHY would people do that to themselves    Why can't you survive without a new pair of shoes until their next paycheck? How is it that you take money from someone else and then you bLAME THEM for giving you the money ?! (i.e. people borrowing money and blaming the loan companies for not checking and seeing that the borrower cannot repay the dept, wtf)

Here's the actual documentary, probably lots of you've already seen it.



And then there was that guy who said the stupidest thing ever: I see new clothes and I don't wanna wait, I want them now, immediately. Wtf.

I hope I'm not offending anyone, but unless you need this money for health issues and have absolutely no other choice, then it is only you to blame if you get up to your neck in debt.

I see more and more such loan shops here, too and people are stupid enough to go there and use their services instead of building their own emergency fund and when needed "borrow" from themselves.

[magentus]

Whilst I can see your point NNR, the people who get caught in the debt trap are very aggressively marketed to and the majority of them are getting the loans to pay for rent, food and heating rather than luxury goods, at least here in the UK. Things are getting worse and worse for the vulnerable and the pay day loaners are  taking full advantage of it without much interference from our extremely priviledged government.

Documentaries like the one you posted highlight a few 'worst offenders' that none of us feel much sympathy for, when in actual fact the majority of people using the companies are finding it very difficult to make ends meet and none of the high street banks will touch them.

[Etherealicer]

While I in general agree here are some of my thoughts

- I think advertisement for this kind of service should be forbidden. We have a ban on advertisement for tobacco, why not money-lenders.
- Where should people learn to save money (spend only money they have)? The Government is notorious for doing exactly that.
- The parents don't take responsibility for the actions of their children, even encourage such behavior (this might not be true for every/other countries / cultures, but here it certainly is).

Competing with your neighbor, colleague has always existed, except it used to be that your competitor were more or less in the same social group (had similar spending power). Thanks to social media, the sheikh of Dubai and the banker from Switzerland are our neighbor a very though competition.

However, the largest problem as far as I see it (and tQUERY_STRING is that parents don't take responsibility anymore.

[N_N_R]

Sure, but then there's another thing I don't get. How come people from the poorer countries (my own included) go to the UK, work some low-paid and hard jobs and they feel like kings with the amount they're paid? lol.

When it comes to heating, rent and essential things... I'm even less convinced that payday loans or any loans are the way to go. It's true that I've never really had to pay rent. In fact, we may be considered rich (according to the statistics we're among the top nations that have their own houses), but actually we live crammed in one small flat for ages until someone has saved enough money to buy their own flat/house and move out somewhere. So, while paying rent may give you some freedom and advantages, not paying rent is also kinda good. And I've also been poor, I'm not talking about stuff I haven't experienced. Eating bread & pickles and not having anything but low-quality " butter-like" spread and half a package of rice in the fridge is not exactly luxury either Of course it's a different mentality, probably, but I'd never get people who're ready to sacrifice their freedom and become slaves to the banks for a piece of meat or cheese. My father was also in debt himself (gambling) and didn't care what he was causing to his family, so I know what it is to struggle with debt, too, but I don't mean.. bank dept. Anyway. My point is, I am fully convinced there are always other ways than to cause yourself to go through the humiliation of owing something to someone. Maybe it's just me I just can't imagine there is no other way and people have no other choice. What was it like before these payday loan shops existed? How were people able to survive?

So, the people who struggle to make ends meet, what happens when they can't pay off their loan?

[N_N_R]

I just firmly believe that one should take the responsibility for their actions. I've seen it way too often that people who lease stuff and don't pay immediately in cash lose a lot; I've seen how a neighbour keeps taking more loans to pay off her previous loans and so on. I'll never get it.

If you have too little money, spend less. If you can't spend less, earn more.

[pfrsantos]

I'm with N_N_R. I hear lots of people complaining they can't make ends meet. Still, they have one (or more) car(s), cable TV, paid internet, go on holydays for 2 or 3 weeks, eat out all the time, buy a house instead of renting one, and so on...

"It's not their fault, it's the advertising companies." is no excuse for me.

Rule #1: THINK!!!! Do the math!

I have no sympathy for people who put themselves in those situations.

[Corwyn]

I am surprised at what you're saying, Nikki.

I'd imagine you being from Bulgaria would think differently.
I for one am paying half of my paycheck each month on bank loans, and honestly I'm really not sorry I got those, when I did...
7 years ago I had 500 Euros per month paycheck, and I had to pay for college, had a cancer-sick mother and an 89 year old aunt with only 25 Euro pension and 300 Euros per month heating fee...
If I didn't go into loans, I couldn't have afforded to pay the heating or doctor bills,  or afforded a computer, I could have never saved enough to get my 4000 Euro crappy car, no chance in hell of ever visiting Greece, or Amsterdam or Paris...
Guess what... I did all these, I have memories to look fond on and a credit I will have paid off in a year.

Shocking are my friends, who go into 50-75 year loans (think 30-40% of their paychecks) to buy some crappy apartment. I am lucky I at least inherited that but... I think it's Communist-block thing... our need to "own" a house and "own" a car... we went from not being able to "own" anything to a pathological possesion issue... than again, with the inflation and all, a house is all you can leave to your kids to give them a head start...

[pfrsantos]

You're paying loans for stuff you *really* needed, not for a 100" TV or an indoor pool or a jetsky...

I have nothing against people resorting to loans when they really need to and doing so when they know they can make the payments. Those people usually don't end up in trouble. It's the "let's take advantadge of the free money now, we'll think about paying it later on" crowd I don't understand or feel any sympathy for.

[N_N_R]

@Corwyn,

Well, maybe it's exactly because I come from a poor country that I've never been willing to pay more for something than it really costs (i.e. pay interest/pay for the loan companies' fees).

I'm sorry to hear about your circumstances - as I said previously, for me it is justified when it comes to health, but not otherwise. If it came to health, I'd no doubt try to find money anyfreakingwhere to save myself or a beloved person.

As for the heating bills, ours are about 100 EUR and my mother's pension is exactly 100 EUR, for example. So, if she lived alone, I imagine she'd sell our flat and move to a house where she doesn't obligatory pay the whole heating crap - i.e. here use it or not, you pay for it, basically. So she'd go somewhere where she can use a heater on wood&coal, use it whenever she wants to only and not pay to a big company for stuff she doesn't need.

As for the computer or trips or something... that's just not me. Since a tiny kid I've always saved my cash and bought my first bike, my first air gun (), my first radio, my first CD player, my first mobile hpone, my first everything came with lots of ... effort and saving of my daily school allowance. Nobody ever acutally bought me anything big and I kinda learned to wait before I afford something. I guess That's what makes me still think like that now.

P.S. to be continued after I'm done working:D

[NKlamerus]

But without payday loans how am I suppose to afford a Tread?!?

[derekmac]

Those are not what I'd consider PayDay loans Corwyn.  PayDay loans (at least here) at small shops that will cash your paycheque early, and keep 10-20% of it as payment for their service.

Real bank loans are perfectly fine, and banks generally won't give loans out if you are in a situation that you can't afford to repay it.  The PayDay loan places couldn't give a smurf if you can afford to lose the percentage that they are taking, as it's their business to rip off people.

[N_N_R]

So, to finish my rant, one of my best friends, who's been working at a proper, that is regular and stable job, for just a shooort time, maybe half a year or so, is already thinking of getting a loan for buying a car in three or so months. It freaks me out. He'll be paying it off for at least three years. And he already has some bank loan which he'll be paying off for another two years. So, for nearly two years, he'll be paying off his first bank loan and his car. And he wants to soon start running his own business i.e. invest more money into this, too. And he also wants to repair whatever thing in the flat or just redecorate, guess how, with a bank loan.

It drives me nuts just to think that I may owe someone something, that I may lose my job and then get into debt. YOu must be super 10000% sure you'll keep your job for years on to do that..

[dks]

Just do a search on her....

[N_N_R]

I think it's Communist-block thing... our need to "own" a house and "own" a car... we went from not being able to "own" anything to a pathological possesion issue... t

Well, I do kinda understand that "own a house" thing. Paying rent and living in a home that's not really yours to me again feels like living on credit/having a loan or something. Basically, you need to make sure you have a job all the freakin time, getting a paycheck coming in so you can pay your rent monthly. You lose the job, the income stops, you can't pay rent, you're out. While if you do have your own house or place to live, you can go scavenge the garbage in the streets, but you'll still have a place to go at night and call it yours.




DKS, yyyeah, saw that ad.

[Billy Ruffian]

Interesting thing to bring up Nikki.

As Magentus said, sadly the reality is that a LOT of people here in the UK do struggle just to pay for the basics, it's often referred to here as "rip-off Britain" because the cost of living is so astronomically high. Huge numbers of people really do just have enough to get by and there is absolutely none left over at the end of the month. So, if a big bill comes in unexpectedly (car suddenly breaks down, say) there isn't anything to cover the cost and many people turn in desperation to these companies who are, when all is said and done, there to prey on people. And once you're in it can be very difficult to get out.

Plus, there is always a healthy quota of people who don't have any concept of saving for something they want, and just want to get it there and then. These payday loan companies are marketed very cleverly and you will often see their commercials positioned just after some desirable product has been on during the same ad-break.

It ain't good though and, without meaning to touch on politics, it really is an area that should be regulated much more strictly.

(I'll climb back down off my moral high horse in just a minute...)

[N_N_R]

Thanks for the post, Billy.

So, it's really really surprising for me to see that people from the US/UK/European countries struggle with finances. I mean, these countries have always kinda been presented like Wonder Land here. So many of our students go to the US or UK for summer jobs; so many people find better paid jobs in Western countries because they aren't paid enough in my country.

I've already discussed the money issue with other people on private messengers/boards and such and it's always amazed me that here we imagine something totally different when we hear the US, the UK, Germany, France.... and all of a sudden I see all this and hear people who actually live there talk about the fact they're poor (speaking generally).

So I wonder if the idea of abundance, wealth, great live and so on is a fake one, created by all the ... debt people actually "hide"? I mean, do people afford their great life just because they have credit cards and loans? (don't have a CC, btw. I did have one before, used it just once out of curiosity and cancelled it before its first annual fee had shown up, lol)

[Billy Ruffian]

You are probably right with most of that, Nikki.

I can only speak for what it is like here, but in addition to the high costs for basic services (food, fuel, heating etc) there are all the add-ons, some of which are kinda necessary, others are just sold to us as something we want to have. So what I mean is, on top of the high cost for the basic things, there is also the cost of things like insurance if you drive a car, which are not strictly necessary to live but most people need it just to get by. Then there is all the extra stuff, say satellite tv subscription, I don't have it but most people I know do and they pay something like £60 a month just for that.

Add together the total cost every month for the real basics, then the services you probably also need, plus one or two 'extra' costs that are not really essential and suddenly, there really is not a lot left at the end of the month.

[Lichtbote]

Nikki, additional to all the said above there is another thing - peoples view on poor and rich differ greatly, based on what they are used and see around.

I´ve seen people here in Germany saying they are poor, and indeed to our general standards they didn´t had much free cash to spend. But, comparing their living-standard (not counting free money to waste for "stuff") to some other (even european countries) middle-class people, they don´t live that bad.

[magentus]

Thanks for the post, Billy.

So, it's really really surprising for me to see that people from the US/UK/European countries struggle with finances. I mean, these countries have always kinda been presented like Wonder Land here. So many of our students go to the US or UK for summer jobs; so many people find better paid jobs in Western countries because they aren't paid enough in my country.

I've already discussed the money issue with other people on private messengers/boards and such and it's always amazed me that here we imagine something totally different when we hear the US, the UK, Germany, France.... and all of a sudden I see all this and hear people who actually live there talk about the fact they're poor (speaking generally).

So I wonder if the idea of abundance, wealth, great live and so on is a fake one, created by all the ... debt people actually "hide"? I mean, do people afford their great life just because they have credit cards and loans? (don't have a CC, btw. I did have one before, used it just once out of curiosity and cancelled it before its first annual fee had shown up, lol)

Good post Nikki. I think there is a view of 'rich' countries such as the US and UK that doesn't tell the whole truth. In the UK we have a very good standard of living compared to the majority world. In my opinion our governments (of both sides) since the Thatcher govt in the 80's have bought the rapacious capitalist ideal hook line and sinker, so that now the top 10% earners own more than 55% of the wealth, and those at the bottom are now taking out pay day loans to get through the month.

It's incredible to me at 47 the difference between what we saw as essentials when I was growing up are far different than the expectations of youngsters nowadays.

People expect to have a mobile phone and a computer, holidays every year, a car, to buy their own house, have new clothes whenever they want, eat out at restaurants, the list goes on and on, and most people are in debt because of this - they want what our media constantly tells us we need to show we are successful.

And the worst thing is that none of this brings any happiness, especially if you go into debt for it.

I am a mostly happy person - We managed to get a car last year when my Grandad left me some money, we rent a small flat, haven't had a holiday in 12 years, haven't got a tv, I'm typing on my work pc and my mobile is a work mobile.

I don't feel I've missed out on anything - my pleasures are simple and can be had for free, as can everyones.

Unfortunately for all of us, nobody makes any money from happy people Big companies want us to be unhappy and to spend our money on their stuff that they promise will be the thing to make us happy.

So whilst our standard of living in the UK is still very high, more and more people here are going into debt just to stand still - the loans are being spent on food, fuel and rent, and the things that get people through the day. It's very very sad.

[kirk13]

But without payday loans how am I suppose to afford a Tread?!?

And another good reason to ban pay day loans

[magentus]

But without payday loans how am I suppose to afford a Tread?!?

And another good reason to ban pay day loans

[kirk13]

(Image removed from quote.)

Just do a search on her....

No! Don't ! 

[magentus]

Interesting thing to bring up Nikki.

As Magentus said, sadly the reality is that a LOT of people here in the UK do struggle just to pay for the basics, it's often referred to here as "rip-off Britain" because the cost of living is so astronomically high. Huge numbers of people really do just have enough to get by and there is absolutely none left over at the end of the month. So, if a big bill comes in unexpectedly (car suddenly breaks down, say) there isn't anything to cover the cost and many people turn in desperation to these companies who are, when all is said and done, there to prey on people. And once you're in it can be very difficult to get out.

Plus, there is always a healthy quota of people who don't have any concept of saving for something they want, and just want to get it there and then. These payday loan companies are marketed very cleverly and you will often see their commercials positioned just after some desirable product has been on during the same ad-break.

It ain't good though and, without meaning to touch on politics, it really is an area that should be regulated much more strictly.

(I'll climb back down off my moral high horse in just a minute...)

great post Billy 

[gregozedobe]

I get annoyed at the ads on TV for "pay-day" lenders here in Oz (we are currently having a rash of them here). 

One in particular shows someone with a need for some $$$ to quickly fix a problem and the line goes "Just [name of lender] it and move on."  Totally neglecting to mention the second half of a loan - PAYING IT BACK !  I wonder how many people get sucked in getting loans they can't really afford with paying the high interest rates these unscrupulous lenders all charge.

And then there are the other (complementary) ads for companies wanting to help you clearing your bad debt history or fix your near bankruptcy situation after you've unwisely borrowed more than you can pay back from the first lot of lenders.  If I wasn't so busy being angry at all of them I'd laugh.        

[captain spaulding]

So, to finish my rant, one of my best friends, who's been working at a proper, that is regular and stable job, for just a shooort time, maybe half a year or so, is already thinking of getting a loan for buying a car in three or so months. It freaks me out. He'll be paying it off for at least three years. And he already has some bank loan which he'll be paying off for another two years. So, for nearly two years, he'll be paying off his first bank loan and his car. And he wants to soon start running his own business i.e. invest more money into this, too. And he also wants to repair whatever thing in the flat or just redecorate, guess how, with a bank loan.

It drives me nuts just to think that I may owe someone something, that I may lose my job and then get into debt. YOu must be super 10000% sure you'll keep your job for years on to do that..

I agree that this is a crazy way to do things and just digging yourself into a hole. Surprisingly many, many people think this way and do this.

Its simple. Live within your means. If you want a car you cannot afford then don't take a loan to buy it. Save for it. If you cannot do that then you are not going to get the car. So many people just want things they cannot afford which I completely understand. The thing is I understand when I cannot afford something and move on. Others have to have it and rather pay extra (loan fees) to have it and might never end up paying it or the loan off which leads to worse issues.

One thing I hate more than wanting something and not being able to get it is owing people money. For me personally I HATE to ever owe anyone money. Even if its $5. It really eats away at me until the debt is paid.

[N_N_R]

Nikki, additional to all the said above there is another thing - peoples view on poor and rich differ greatly, based on what they are used and see around.

Yes, of course, that's a valid point.


But I still don't get how people fall for these ads. Before seeing that YT vid, I hadn't even paid attention to all these ads on our TV and was wondering if these "shops" had any clients at all.

But since pawnshops have customers, why not these too? I don't have the slightest experience with pawnshops either, I don't even shop there. But are they more humane?

And when a person enters a payday loan shop, aren't they told about all the interest and conditions? I guess they are. However, most probably don't even realize what's 352% interest.



I totally agree with you, @Captain 



This is exactly my friend I mentioned previously. I won't talk about currencies in order not to .. give away persona info, he's crazy about that, so..yeah. He's expecting a raise. And this raise will leave him with about 500 of his currency left a month. The car he wants to buy is 5000. So. Can't he save the 500 for 10 months and buy a car in cash and know that it's his and he doesn't owe anything? Well, no, he'd rather not wait for 10 months, not save for 10 months, but buy it immediately and then instead of saving for 10 months, paying for 3-5 years every single month. wtf.


I do realize that there are people in very difficult situations out there, but most of the people PayDay loaners take advantage of aren't really in that deep a need. And probably some of the main reasons why people get in serious debt is because they must pay off a house or a car or both at the same time. So even if you get fired, you must still pay these off. While if you'd bought them and they were yours, if you'd paid cash for them, you wouldn't need to do that.

I also don't understand people's constant whining they have no jobs. Well, everyone around me complains they got no jobs, they aren't paid well, there's no work, the rates of unemployment skyrocket and so on. While when I open the most popular job ad site here... well, it's FULL of vacancies. True, the positions eihter require some crazy high education or are for sellers, shop assistants, waitress and other lower-paid positions. But you can't say there is NO work. If you don't want to work, that's another thing.



@magentus,

A good point on the difference between the essentials now and then. Another reason for people to get trapped. Not long ago I read some statistics, we, BGs, have like 2-3 cell phones per capita, lol. And the kids, oh, the kids. Why are my relatives and acquaintances so ridiculously stupid. My cousin constantly complains he's got no money, his mom paid half of his car (he's 37, btw), yet his tiiiiny son, 5-6 years of age, got a taaablet.

Another acquaintance's daughter got a puppy for whatever holiday. She's a youuuung kid, 7-8 years or so. Now the kid wants a smartphone. And they told the kid to choose - the puppy or the phone. So the kid chose the smarphone and hte puppy had to leave their house - thank God my sister wanted a dog at this time, so the poor thing is now safe & well. But anyway, a 7-year-old with a smartphone. wtf. And the family clearly can't afford the smart phone because they asked me about mine (as it's cheaper class - Prestigio) and if one could pay it off in installments and so on. Well, wtf, I paid for it in cash, it's actually ridiculously cheap compared to other smartphones. But this is another example how parents make the mistake of spoiling their kids. If a kid at the age of 6-8 gets tablets and smartphones, what will you do when the kids become 18? Buy them a palace?

I am single, maybe that's also a factor i.e. I don't have to take care of other people. When I have a family of my own, probably I'll think differently, though, hopefully, the person next to me wont' be unemployed

I can't help thinking, though, that lots of people do it just so, because it's trendy, modern, fashionable (as I was told by the friend I referred to earlier in this huuuge essay.)

[tosh]

Whilst I can't speak of the pay day loans I understand the lure...I think
Here in the UK, materialistic wealth seems to know no bounds. Friends who I've known meh whole life suddenly seem to want EVERYTHING and want it today!!

One of my closest friends who I've known since I was 5 has got sucked into this tragic world. It seems that people wrongly assume that by driving a Range Rover Sport blacked out of course allows you to think you've suddenly left the working class and moved on up to middle class. The fact that he lives on beans on toast and constantly has to use these so called payday loans to keep up appearances is just tragic to watch. He now goes to casinos where the staff flock around him and make him feel special!! Yet the tragedy is they couldn't give a damn in reality.

I think payday loans and those god awful gambling sites that are now everywhere really should be brought under control.

Maybe I'm just too old fashioned but my mantra has always been "sow the seeds and reap the rewards"

I really don't understand all this need for people to create envy with their neighbours.
So sad.

[pfrsantos]

Well, we all know why this happens, right?

Show content

I mean, it's more than obvious...

Show content

 

[Weasel]

It's a shame people have to use payday loan companies,
In the past I've had bank loans for fancy cars etc but hated owing money so a few years ago  I got rid of the nice car , paid my loans off and now I don't owe a penny , I rent a house and have the crappist  car in the street but im happy that I'm dept free.

[Syncop8r]

Here there are lots of Pacific Islanders caught up with these loans. They are under enormous pressure to donate large amounts of money to their churches, so they take out loans to pay them.