So, I’ve been meaning to write this post for months and months now but I’ve never managed to get around to it but today I’m going to tell you how you can claim a refund from a payday loan if you’ve ever had one in the past.
I genuinely hope that none of you has ever had to rely on a payday loan to get you through to the end of the month but if you have then there is an opportunity to potentially claim some compensation if it was mis-sold to you.
It was more then likely mis-sold if you couldn’t afford it at the time and I don’t know about you but my thoughts are that if you needed to turn to a payday loan to get you through then the chances are that you couldn’t afford it.
It then follows that the lender you went to didn’t do the right affordability checks which could indicate that it was mis-sold.
And don’t even get me started on the companies who offer to extend your short term payday loan for a bit longer (for a fee obviously) and then for a bit longer again. And potentially again. Was that the right thing for them to do or was that mis-selling again?
Now I have a vague recollection of taking a payday loan out way back when the kids were younger. I’m 99% certain it was when I was on maternity leave with Master F who’s now 15 and I really can’t remember why or how but I do know that we felt at the time that it was a quick fix to get us through to payday.
I’d completely forgotten about it until I got a series of emails from The Money Shop over the past six months or so. Apparently, they must have got into trouble for mis-selling on a grand scale as they’ve set up a compensation scheme for all of their customers over the years who they’ve sold payday loans to without full affordability checks. Apparently, I was one of many who was eligible to make a claim for compensation which was super easy to do – it was just a matter of filling in a quick online form (I didn’t need any specifics about the loan as they had all that) and now I have to sit back and wait to see how it all progresses.
Anyway, when I was doing a quick search to see if it was genuine, I came across loads of companies who were offering to submit your claim for you and manage it – for a not-so-small percentage of whatever compensation you get. This makes me so mad as it makes out that it’s a complicated process which it absolutely isn’t! You don’t need to pay someone else to do it at all as you can absolutely do it if I can.
You can get in touch with the company directly if you want to but I love Resolver as it’s completely free to use, they don’t take anything from your compensation and best of all, it’s ridiculously easy to submit a claim taking you through the steps in a clear way that everyone will be able to do.
If you prefer not to use Resolver then you can write to the lender directly – there’s some great templates online if you do a quick search but basically you just need to say that you don’t believe that the relevant affordability checks were done and ask for a refund of all interest and charges you paid on the unaffordable loan along with the 8% statutory Ombudsman interest on top. You should also ask for the loan to be deleted from your credit record if it’s still on there, as this could be harming your credit score and severely damage your chance of getting credit in future.
The company then have up to eight weeks to respond to your complaint but they won’t always respond in the way you want them to. But if you’re unhappy with your offer of settlement or the company reject your claim outright then you can refer your complaint to the Financial Ombudsman who will fully review your complaint and make a decision either way. You can also refer to the Ombudsman if you don’t get a response from the company.
If your claim is successful, you should get all interest, fees and charges back along with 8% interest per year which will often amount to more than the value of the amount you borrowed originally due to the ridiculous charges that they made.
You can still claim if the company is in administration but you might not get as much money so speed is absolutely key here.
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