Wonga.com - Improve credit score?

NeoReloaded · 23 Apr 2011 at 21:05

My mate uses Wonga.com all the time and he's still always skint! He says it's to build his credit score, but the ammount they charge he always missed the odd payment which puts him back to square 1 and is costing him money for no reason!

meghatronic · 23 Apr 2011 at 21:19

weringo said:
Paying over 8% on a week long loan is still insane, you can get credit cards with lower annual rates than that

It isn't exactly aimed at people with good credit now, is it.

After all, who would need to borrow £400 for 7 days?

weringo · 23 Apr 2011 at 21:53

meghatronic said:
It isn't exactly aimed at people with good credit now, is it.

No, but even with a 35% APR credit card which the likes of Capital One give out to everybody you'll be paying a lot less than Wonga charge.

[TW]Fox · 23 Apr 2011 at 21:54

weringo said:
No, but even with a 35% APR credit card which the likes of Capital One give out to everybody you'll be paying a lot less than Wonga charge.

I suspect that people getting wonga loans are not doing so in order to buy stuff they could otherwise easily get on a credit card.

weringo · 23 Apr 2011 at 22:02

[TW]Fox;18972019 said:
I suspect that people getting wonga loans are not doing so in order to buy stuff they could otherwise easily get on a credit card.

The cash you can withdraw from an ATM with a credit card is just as good as the cash Wonga will give you, bar the daily withdrawal limit.

meghatronic · 23 Apr 2011 at 22:17

weringo said:
No, but even with a 35% APR credit card which the likes of Capital One give out to everybody you'll be paying a lot less than Wonga charge.

Only with a CC there is no force to repay the money after a week, or a month, or a decade....

Beasty · 23 Apr 2011 at 22:21

Nothing wrong with wonga quickquid etc if used sensibly.

Will aid your but I don't know if it's the best way. People freaking about the 4000 apr should just sit and read what it is about.

weringo · 23 Apr 2011 at 22:27

meghatronic said:
Only with a CC there is no force to repay the money after a week, or a month, or a decade....

Which surely adds to the arguement against using Wonga...

Azuse05 · 23 Apr 2011 at 23:06

Actually having constant debts improves your score. While technically paying things off is the right thing to do, if you constantly pay things off asap you'll find yourself being turned down for things like better/extra CC while the person whos always in debt will get them. More debt for longer = more profit for lender.

CC > wonga though.

meghatronic · 23 Apr 2011 at 23:08

weringo said:
Which surely adds to the arguement against using Wonga...

Er no? As the types of people needing to use Wonga haven't exactly demonstrated sound financial judgement (as it's such a short duration loan). So a CC would be like free money to them > spiral > too much debt.

Azuse05 said:
if you constantly pay things off asap you'll find yourself being turned down for things like better/extra CC

My credit is perfect - and I've not paid a penny in interest in my life. :confused:

.Lethal · 23 Apr 2011 at 23:16

I wouldn't use services such as Wonga, just to improve my credit rating.

If you're only using Wonga to improve rating I would look elsewhere, making regular payments will increase your credit score over time - direct debts, loans, credit cards etc.

Azuse05 said:
Actually having constant debts improves your score. While technically paying things off is the right thing to do, if you constantly pay things off asap you'll find yourself being turned down for things like better/extra CC while the person whos always in debt will get them. More debt for longer = more profit for lender.

CC > wonga though.

Well, its more to do with the fact that if you make no regular payments, a lender will not know how reliable you are with credit.

Whereas a customer that makes regular payments without missing deadlines shows that they are responsible with credit.

Making no regular payment does reduce your credit score though.

weringo · 24 Apr 2011 at 00:27

meghatronic said:
Er no? As the types of people needing to use Wonga haven't exactly demonstrated sound financial judgement (as it's such a short duration loan). So a CC would be like free money to them > spiral > too much debt.

So a loan service which forces you to repay at a certain date is better than a service which allows flexibility. Right...

In actual fact the concept is similar with both services, no one is forcing you to repay a Wonga loan on the specified date, just how no one is forcing you to make a payment to a credit card. However with both services you incur default charges if you miss the payment. If I was bad with my finances I know I'd prefer a service which charges me a 35% APR should I miss a payment rather than the 360% with Wonga.

I honestly can't believe some of the defence of services like Wonga in this thread, you would have to be a complete mug to pay their rates when you consider other options of short term financing (bank OD, credit cards, friends/family etc).

Vonhelmet · 24 Apr 2011 at 00:51

meghatronic said:
ANNUAL
So, small loan, "short term" as you said.... How cruel of them:

Yes, thank you, I know what APR means.

The rates charged by Wonga et al are usurious, and the people who resort to that sort of thing are there because they've ****ed something up.

Strife212 · 24 Apr 2011 at 01:18

vonhelmet said:
The rates charged by Wonga et al are usurious,

They aren't, who would lend £400 to make 4p out of it?

meghatronic · 24 Apr 2011 at 09:48

vonhelmet said:
Yes, thank you, I know what APR means.

The rates charged by Wonga et al are usurious, and the people who resort to that sort of thing are there because they've ****ed something up.

If I lent you £400 for a day, I'd expect something for my trouble - especially if you weren't good for it. 8.4% seems fair to me

. Especially as they wire you the cash instantly.

weringo said:
So a loan service which forces you to repay at a certain date is better than a service which allows flexibility. Right...

I honestly can't believe some of the defence of services like Wonga in this thread, you would have to be a complete mug to pay their rates when you consider other options of short term financing (bank OD, credit cards, friends/family etc).

You're missing the point - Wonga isn't providing a service to you or me. It's providing a service to people that can't secure OD/CC/friend or family loans. It's providing and alternative to pawn shops and loan sharks.

A loan service that forces you to pay at a set day is much better than an ad infinitum debt as it allows one to budget more appropriately. They're effectively pay day loans - not for "I want to by a TV at x per month".

Glaucus · 24 Apr 2011 at 09:50

Ciba said:
With 4214% APR I'd think there are a lot of better ways of improving your credit score.

Upto £50 cash back through quidco for various companies, so you end up paying pretty much zero, all depends how long and how much

pingwing · 24 Apr 2011 at 11:31

Beasty said:
Nothing wrong with wonga quickquid etc if used sensibly.

There's quite a bit wrong with it really, the attitude of the companies is to encourage its target customers that the banks/people they have to pay money to are basically the law and that if you cant just negotiate things like sensible payment days, or sensible money management.

From my experience most companies dont really mind on what date you pay by direct debit, just so long as it always gets paid, when it seems these legalised loan sharks are telling you that you have to get the money to keep in good books of "the man".

Anyway we should stop treating our credit scores like a video game ranking that we can level up, just make sure you have money and dont go out of your way to try and have what you realistically can not afford just because it might be worth working for

golfmadjunkie · 2 Jun 2011 at 13:03

credit repairing

in my opinion wonga can be used to repair your rating - just pay the damn thing off, because even small balances left, can grow over the space of a year. £25 left in wonga for a year would turn into over a grand! The more products you have (and settle with no arrears) seems to assit your credit score. I found a free iphone app - icreditscore that purports to calculate your score for free using your own data, i tried it and it seemed to work very well. I recommend these type of resources to get an idea of how your credit score is put together.

darubio · 2 Jun 2011 at 21:10

i hate the guy who does the advert so annoying lol

Webboffin · 30 Mar 2013 at 19:00

meghatronic said:
Er no? As the types of people needing to use Wonga haven't exactly demonstrated sound financial judgement (as it's such a short duration loan). So a CC would be like free money to them > spiral > too much debt.

My credit is perfect - and I've not paid a penny in interest in my life.

Then without getting any credit how do you know you have a perfect credit score?