People Turning To PayDay Loans To Pay Their Rent Or Mortgage
Many people are struggling with their finances and relying on credit to pay their housing costs with almost one million people resorting to payday loans.
According to a survey by Shelter, nearly one million people have taken out a payday loan to help pay their rent or mortgage in the last 12 months. Others are using other forms of credit, including unauthorised overdrafts, other short term loans and credit cards.
The worry is the resulting spiral of debt that people are falling into just to keep a roof over their head.
The charity warns that the New Year could bring with it a risk of homelessness, for those who are struggling with their housing costs and is urging anyone worried about their debts to make seeking early debt advice their New Year’s resolution.
Martin Lewis of MoneySavingExpert.com, said: “It’s incredibly worrying there’s now evidence of people using payday loans to meet housing costs. Many struggling with core rent or mortgage commitments will struggle to repay payday loans on time too.
“While it’s an obvious temptation to grasp these loans as a lifeline, in the long run it may hurt more than help.”
And as Campbell Robb, Chief Executive of Shelter, comments: “Turning to short-term payday loans to help pay for the cost of housing is totally unsustainable. It can quickly lead to debts snowballing out of control and can lead to eviction or repossession and ultimately homelessness.
“Every two minutes someone in Britain faces the nightmare of losing their home. We urge every single one of these people now relying on credit to help pay their rent or mortgage to urgently seek advice.”
MoneyHighStreet.com comments: ” We absolutely agree with Campbell that those regularly relying on credit to help with rent or mortgage payments should urgently seek advice.
Equally if you feel your personal finance is getting out of control, that you cannot manage your debts as your outgoings exceed your income, the sooner you seek help or advice the better. Debt problems are unlikely to resolve themselves without some proactive action from you.
british payday loan companies - News
“Shelter too has a network of specialist advice services around the country, a free telephone helpline and online advice available at shelter.org.uk/debt, including a new budget calculator.” PayDay Loans.
"Cameron and his cronies must get their act together and regulate these companies out of existence before more people face financial ruin as a result," he added. The MEP claimed that, over the festive period, "many payday loan companies are targeting
The company launched in Britain in July 2011. Jokela said it currently had "less than 100000 customers" in Britain, adding Ferratum expected the number of people who have applied for payday loans in Britain to rise across the industry to 3.5 million in
When times are tough, people cut their cloth accordingly," Cash Converters UK Chief Executive David Patrick told Reuters in a telephone interview. "People are getting more conscious of their budgets and getting more savvy." Payday loan firms and
I expect the best solutions are with credit unions. davefb shares some personal experience of this issue: The problem is that frankly a payday loan to cover a wage that is a few days late in order to pay the mortgage is a great way and could be cheaper
Loans | Payday Loans Firm Ferratum Expecting Big UK Growth ...
LONDON (Reuters) – Payday loans firm Ferratum is expecting rapid growth in Britain this year, and its chief executive said fears over unemployment and the sometimes punishing interest rates associated with the loans had not dented demand from customers.
“We are expecting a huge increase in our numbers in Britain for this year. People want to take on a small loan, they don’t want to go to the bank for a bigger loan,” CEO Jorma Jokela told Reuters in a telephone interview.
Ferratum was launched in 2005 and is majority-owned by Jokela, who says the Finland-headquartered company is the biggest in its sector in Europe.
It benefited from the traditional Christmas shopping season to win several thousand new UK customers in December, who took on short-term loans to buy presents, with a fourfold increase in applications for its loans from November to December.
Across the group, customer numbers rose to 1.1 million in 2011 from 650,000 in 2010. Its long-term goals include reaching more than 10 million customers by 2014, with operations on all five continents along with its core European market.
Jokela said Ferratum remained a profitable business. He said it had a pretax profit figure that was a “double-digit number.”
The company launched in Britain in July 2011.
Jokela said it currently had “less than 100,000 customers” in Britain, adding Ferratum expected the number of people who have applied for payday loans in Britain to rise across the industry to 3.5 million in 2012 from 2 million in 2011.
POLITICAL CONCERNS OVER PAYDAY LOAN FIRMS
Payday loan firms, such as Ferratum, The Money Shop and Cash Converters, typically lend out a few hundred pounds to customers for a week or fortnight, tiding them over until they get their next pay cheque.