Urgent warning from Martin Lewis to anyone who has ever taken out a payday loan
People sometimes find themselves in financial difficulty and, out of desperation, take out a payday loan as a quick fix to their problems.
These payday loan companies have become popular over the past 10 years, but they are now regulated and in danger of disappearing.
Wonga was the headliner of these companies but collapsed into administration in 2018.
Similar companies, including Juno Loans and Wage Day Advance, have also disappeared.
Money saving expert Martin Lewis explained in his weekly newsletter that anyone who has taken out a loan from a payday lender may have the right to get money back. He said: “These irresponsible companies have fallen under the weight of allegations of unaffordable gouging and price caps from the regulator.”
But that does mean that if you or someone you know has taken out a loan, you have very little time left to see if you owe cash back because of questionable practices, the Mirror reports.
“If you’ve been sold poorly and a business is solvent, you get the full amount back, but if it goes bankrupt, you’re just one of the creditors and you’re lucky to get a few cents per pound. So hurry up, ”Martin explained.
You have to act fast
The first thing payday loan customers need to do is determine if they can claim it. The good news is that a lot of people can.
“Lenders should look at your finances to make sure you can pay the loan and the fees. If, as was often the case, it was not done correctly and you should not have received the money. , or if the costs or the repayment schedule weren’t clear, you were sold badly, ”Martin explained.
And the payments can run into the thousands – because people can get all of their interest, fees, and charges as well as 8% per annum interest on all money owed to you.
Money Saving Expert has a checklist here where you can see if you qualify.
It’s also important to point out that you don’t need a claims management company to get your money back – with free tools like those offered by Resolver.co.uk available to walk you through the process.
The best news is, if you fend for yourself, you don’t have to pay a claims handling company fee that can eat up more than a quarter of your payment.
And what about people who had a loan from a business, like Wonga, which has since gone out of business?
Well, all is not entirely lost.
“If a credit company goes bankrupt, you join a long line of other creditors,” explained James Walker of the free customer complaints service Resolver.co.uk.
In Wonga’s case, it’s Grant Thornton – who has now opened a Wonga claims portal.
But you don’t have quite the same rights as if the business is still in operation.
“If you don’t like the response, there’s not much you can do,” Walker said.
To keep up to date with all the latest news, stories and events happening in London, like the MyLondon Facebook page.
We will provide you with the latest traffic and travel updates, including updates on London train and Underground services, and routes around the capital.
The latest breaking news will go straight to your news feed, including updates from the police, ambulance and fire department. We’ll also bring you updates from our courts and advice, along with some lighter long reads.
We also post your photos and videos, so send us a message with your stories.
Like the My London Facebook page here.
You can also follow us on Twitter here and Instagram here.