Friend in debt with logbook loan

Colonel_Klinck said:
These loan sharks should be far more heavily regulated. Those interest rates are criminal. Anything over 50% should be banned imo. If a company can’t make money on that rate then there is something seriously wrong.
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The problem is that they won't make money on a low interest rate if they are lending to the type of borrower that defaults on payments - people are refused 'normal' loans for good reasons in most cases. In the case of the OP's example, was it better or worse that they were given a loan to tide them by when there is no other legal option? Things weren't better before these companies existed, you just ended up being threatened with (or given) violence when people used illegal loan sharks.
 
Em3bbs said:
The problem is that they won't make money on a low interest rate if they are lending to the type of borrower that defaults on payments - people are refused 'normal' loans for good reasons in most cases. In the case of the OP's example, was it better or worse that they were given a loan to tide them by when there is no other legal option? Things weren't better before these companies existed, you just ended up being threatened with (or given) violence when people used illegal loan sharks.
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I understand there is a risk of default with people poor credit history but in this case they are putting a car against the loan so they will always get their money back. It just seems very very wrong to me. Desperate people make stupid decisions and regulators should protect them from making a bad situation 100x worse.
 
Psycho Sonny said:
nothing to do with hindsight. only a moron would take out a loan at 300% with interest being charged at the start.

i would if i was extremely tight for cash just go on a mortgage payment holiday. as i have accrued enough over payments to do so for several years.

but if i never had that facility available there is no way i would go near any loan above 3%. i'd rather borrow money from someone i know and pay them 3%.
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That's great if you've got a mortgage or the ability to get a loan at 3% or know someone who has the cash ready to drop you a couple of grand at short notice. The type of person that gets sucked in by these companies probably don't have access to any of that.
 
tom_e said:
That's great if you've got a mortgage or the ability to get a loan at 3% or know someone who has the cash ready to drop you a couple of grand at short notice. The type of person that gets sucked in by these companies probably don't have access to any of that.
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The type of person who fits the bill is usually

Unemployed or in a terrible job or on benefits
Lives in a terrible area
Never bothered to give a toss about anything other than drink and drugs
Poorly educated due to not giving a toss
Therefore doesn't understand interest or how it works

It's not companies preying on the poor but them preying on idiots. Sure some poor deserving soul may get caught with them but they should know better.

I mean 300% interest up front. Even if desperate a normal person would know that isn't feasible nor is it worth taking even if desperate.

To borrow £4k and end up paying back £12k+ you would need to be a special kind of desperate to do that. There are other options available. Crisis loans from the government for example. Which are interest free.
 
I often wonder at the type of people who work at these rip-off loan companies.

I couldn't do it myself, my conscience wouldn't let me get a good nights sleep.
 
Psycho Sonny said:
The type of person who fits the bill is usually

Unemployed or in a terrible job or on benefits
Lives in a terrible area
Never bothered to give a toss about anything other than drink and drugs
Poorly educated due to not giving a toss
Therefore doesn't understand interest or how it works

It's not companies preying on the poor but them preying on idiots. Sure some poor deserving soul may get caught with them but they should know better.

I mean 300% interest up front. Even if desperate a normal person would know that isn't feasible nor is it worth taking even if desperate.

To borrow £4k and end up paying back £12k+ you would need to be a special kind of desperate to do that. There are other options available. Crisis loans from the government for example. Which are interest free.
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The problem is people who do this don't see 12k. They see "here's the 4k I need right now to solve my problems".
 
It really is taking advantage of people in desperate situations and whilst people do need to be daft to take on these types of loans we all (at some point) make decisions we regret. This is no different from Wonga or Brighthouse, just scummy companies that target the weak and bleed them dry until they have no hope of escaping the financial hell they get themselves into. There's something very toxic about these types of loans, they ruin people and families, you know those families, they are the same ones in CEX selling stolen XBOX games, or digging through their pockets for change to buy lottery scratch cards in ASDA, whilst their kids are running around collecting ASBOs. It's just another way that poor income families get trapped in this cycle of low income life....

I wonder how many of those that drop out of school have parents that used these services? I wonder how many of the victims / perps of the knife crime at the moment are from families that have used one of these services?

These companies are a blight on the UK, they need eradicating like those slot machines in the gambling shops, lottery scratch cards, Brighthouse etc.... offering those with poor credit, more credit at huge APR rates is just throwing fuel on the heart of the issues we in the poorer crap towns in the UK.

/rant
 
What would the people with nothing do without these 'solutions' ?

I mean, does it actually help ?
 
413x said:
What would the people with nothing do without these 'solutions' ?

I mean, does it actually help ?
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well they have to pay them back or go bankrupt.

so they would just save the cash up (that they would pay them back with instead) or go bankrupt.

the problem is credit full stop. if we banned credit for everyone earning less than £50K a year apart from mortgages the majority of the "poor" in the uk would be fine.
 
Psycho Sonny said:
nothing to do with hindsight. only a moron would take out a loan at 300% with interest being charged at the start.

i would if i was extremely tight for cash just go on a mortgage payment holiday. as i have accrued enough over payments to do so for several years.

but if i never had that facility available there is no way i would go near any loan above 3%. i'd rather borrow money from someone i know and pay them 3%.
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Same, I'm also perfect in every way and have never had life deal me a crap hand. I'm always on top of everything 100%. Were you born with all this knowledge? I was. Never made a mistake in my life.
 
Psycho Sonny said:
well they have to pay them back or go bankrupt.

so they would just save the cash up (that they would pay them back with instead) or go bankrupt.

the problem is credit full stop. if we banned credit for everyone earning less than £50K a year apart from mortgages the majority of the "poor" in the uk would be fine.
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Why does someone earning over 50k a year need credit? Can they not manage on that...
 
Uther said:
Why does someone earning over 50k a year need credit? Can they not manage on that...
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The kind of credit talked about in this thread doesn't help a person earning <50k. It cripples them. Nobody "needs" that.

So yeah... credit from approved sources only. And Wonga would not be an approved source :p
 
Diddums said:
Same, I'm also perfect in every way and have never had life deal me a crap hand. I'm always on top of everything 100%. Were you born with all this knowledge? I was. Never made a mistake in my life.
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Adopt me oh wise and sensible one.

Sonny for PM.
 
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