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Payday Lender Collapses Into Administration

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http://www.credittoday.co.uk/article/15546/online-news/payday-lender-collapses-into-administration#.UdWaf_5AHOo.twitter

Payday lender collapses into administration 4 July 2013

Payday lender Speed-E-Loans.com Ltd has collapsed into administration just months after publishing results which revealed the firm needed new funds to continue trading.

Administrators were appointed to the company today (4 July), with the case handed to Alan Simon of Accura Accountants Business Recovery Turnaround.

Speed-E-Loans.com once sponsored World Championship snooker players Ali Carter and Joe Perry, and made headlines in January 2012 for claiming demand for payday loans trebled over the Christmas period.

But the firm subsequently suffered a downturn with its latest set of financial results – signed off in December 2012 – revealing the directors were seeking a long-term debt facility to continue trading.

Since then Stuart Mitchell and Danny Miller – the only remaining directors listed in the results statement – have been terminated as directors of the business on Companies House.

In the accounts statement the firm’s auditor, BDO, reported: “The directors are in negotiation for a long term debt facility to fund future development and expansion, however the drawdown of these funds is dependent on a number of conditions being met.

“These conditions indicate the existence of a material uncertainty which may cast significant doubt about the company’s ability to continue as a going concern.”

The results also revealed that in August 2012 the company parted ways with former chief executive, Gary Miller-Cheevers, who is now listed as a director of Early Payday Loan Limited, a subsidiary of pawnbroker Albermarle & Bond.

His departure also prompted the settlement of an outstanding loan he had with the company, which the directors chose not to provide further information about on the basis it would be “seriously prejudicial” to do so.

By Alex Cardno

"Need new funds to continue trading."

I'd hazzard a guess that rather than 'new funding' what they actually needed is for enough of their customers to pay them back their high interest, short-term loans.

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Guest eight

I know someone who has taken out a load of these with no intention of repaying them. He is trying to force a test case but so far none of them will bite.

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I know someone who has taken out a load of these with no intention of repaying them. He is trying to force a test case but so far none of them will bite.

Other then the usual letters and threatening court action and or to pass the debt to a collection agency + their fees what tactics do these firms make when repayments fall behind?

Do they actually send some big chaps around late at night?

There must be a tipping point at which this trade is going to become uneconomic. Maybe we are seeing the start of a few failures as more people wake up to the fact there is no appetite to chase them to court for moneys owed.

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Guest eight

Other then the usual letters and threatening court action and or to pass the debt to a collection agency + their fees what tactics do these firms make when repayments fall behind?

Do they actually send some big chaps around late at night?

There must be a tipping point at which this trade is going to become uneconomic. Maybe we are seeing the start of a few failures as more people wake up to the fact there is no appetite to chase them to court for moneys owed.

They ring him up and say "Are you going to pay?" He says "No, I want you to take me to court or otherwise cease all communication." They say "We try to avoid court where at all possible" (I bet they do :lol: ) and the whole thing repeats.

He has no income by the way (apart from ripping off payday lenders, obviously). One of the loans was 40000%+ APR. Can you really see a court enforcing that?

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Gidiot needs to try harder with his expansionary austerity.

1500 money laundering loan sharks isn't nearly enough for a thriving economy like the UK

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Gidiot needs to try harder with his expansionary austerity.

1500 money laundering loan sharks isn't nearly enough for a thriving economy like the UK

They are not sharks, they are businesses endorsed and encouraged by the government that are in business to fleece those with the least and can least afford the high rate of interest when the money cannot be repaid on time.....same as it ever was, the poorest end up paying the most. ;)

Edited by winkie

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No chance of us seeing a high profile media case then where they highlight the reluctance of the pay day landers to progress anything to court.

After all it could give the proles an idea which would decimate this industry overnight.

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He has no income by the way (apart from ripping off payday lenders, obviously). One of the loans was 40000%+ APR. Can you really see a court enforcing that?

Yes. Usury laws were abolished in the 19th century, and Courts are unwilling to unravel deals, however bad a "bargain" they may be.

The reason for not going to Court is more likely due to the fact it would cost more to hire an advocate to Court (involves a lot of sitting around) and its pointless pursuing the penniless, or more accurately, the assetless

Even if a Court makes a judgement, is pretty powerless to enforce it against such people.

I fully expect LabourTory to include Debtors Prisons and Workhouses in their manifesto though. They have been "talking to people" and such concepts went down very well in the focus groups.

Edited by Secure Tenant

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Guest eight

No chance of us seeing a high profile media case then where they highlight the reluctance of the pay day landers to progress anything to court.

After all it could give the proles an idea which would decimate this industry overnight.

That's what the chap in question wants to highlight. The thing is, it's as likely to go the other way - people who have successfully repaid loans seeking compensation for "mis-selling" as even the most cursory checks with regards to ability to pay are often not carried out.

wonga are the clever ones as they ramp up people's "credit limit" as a result of successfully repaid loans - essentially they are lending people's own money back to them! So by the time a customer defaulted on a £1000 loan (the maximum they will lend) they would already have been profitable overall for the company.

One thing it is worth highlighting is that unlike mainstream banking's Injin style "bank credit" that they apparently create out of nothing in order to lend out, these guys are playing with real cash. Hence the possibility of failures such as that in the OP.

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I fully expect LabourTory to include Debtors Prisons and Workhouses in their manifesto though. They have been "talking to people" and such concepts went down very well in the focus groups.

If it stops people making a living ripping people off then sounds good to me. Thats what this guy in question is doing after all. Of course, they are stupid trying to lend money to someone who has no intent whatever of paying it back.

Clearly the rule of law is being made a mockery of. What's the point of playing by the rules? May as well just rip off some loan companies.

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Guest eight

Yes. Usury laws were abolished in the 19th century, and Courts are unwilling to unravel deals, however bad a "bargain" they may be.

Well I'll have to disagree there. There have been plenty of actions against "sharks" in the past, and in many cases I doubt these payday style agreements even constitute a binding credit agreement.

Also, if you charge a high interest rate to reflect a high rate of default it's a bit rich to go crying to mummy when somebody does!

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Yes. Usury laws were abolished in the 19th century, and Courts are unwilling to unravel deals, however bad a "bargain" they may be.

The reason for not going to Court is more likely due to the fact it would cost more to hire an advocate to Court (involves a lot of sitting around) and its pointless pursuing the penniless, or more accurately, the assetless

Even if a Court makes a judgement, is pretty powerless to enforce it against such people.

I fully expect LabourTory to include Debtors Prisons and Workhouses in their manifesto though. They have been "talking to people" and such concepts went down very well in the focus groups.

APR, like GDP, is a poor measure of a given situation.

borrow £50 AND pay it back over a month with £10 fees and £10 interest and the APR is astronomic....but it is only £20 after all.

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Clearly the rule of law is being made a mockery of. What's the point of playing by the rules? May as well just rip off some loan companies.

Exactly and I have people on my Facebook who have played the system well.

They have taken Payday lenders for thousands and no hint of Court action.

You might think this is a scorched earth policy, but like a bus, another payday lender will be along any minute now.

Like gambling debts is a system largely built on trust.

I'm not convinced its the debtors being abused here, something else is going on.

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They ring him up and say "Are you going to pay?" He says "No, I want you to take me to court or otherwise cease all communication." They say "We try to avoid court where at all possible" (I bet they do :lol: ) and the whole thing repeats.

He has no income by the way (apart from ripping off payday lenders, obviously). One of the loans was 40000%+ APR. Can you really see a court enforcing that?

Not a typo? :blink:

At 40,000%apr lending to the majority of people would pose a problem.

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APR, like GDP, is a poor measure of a given situation.

borrow £50 AND pay it back over a month with £10 fees and £10 interest and the APR is astronomic....but it is only £20 after all.

Quantity not quality........soon adds up to mega amounts....take it back out at one second past midnight on pay/benefit day......where has the rent money gone? ;)

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unlike mainstream banking's Injin style "bank credit" that they apparently create out of nothing in order to lend out, these guys are playing with real cash.

I used to think that but it's not the case. Only the Central Banks get to create money out of nothing, the other banks lend out their deposits, which then come back in to a different account, then get lent out again etc.

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Not a typo? :blink:

At 40,000%apr lending to the majority of people would pose a problem.

Borrow £400, pay back £450 a few days later, soon mounts up. I think it was £4/£100/day, something like that. Plus an "admin fee".

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They are not sharks, they are businesses endorsed and encouraged by the government that are in business to fleece those with the least and can lease afford the high rate of interest when the money cannot be repaid on time.....same as it ever was, the poorest end up paying the most. ;)

Being Poor Is Expensive

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Guest eight

I used to think that but it's not the case. Only the Central Banks get to create money out of nothing, the other banks lend out their deposits, which then come back in to a different account, then get lent out again etc.

They do have fractional reserve to fall back on though, which I'm pretty sure none of the payday lenders do. Or do they? I'm surprised that none of them take customer deposits actually. But then why share the "wealth"?

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Energy tariffs are higher due to the up front standing charges or higher cost of the first unit usage....more expensive if on a meter.......food is more expensive if you can't buy in bulk or don't have the cooking equipment or facilities to make your own.....any kind of credit costs more and with private rent you get less space and facilities for more money......the list goes on.

Many people make lots of money directly and indirectly from the disadvantaged and low paid. ;)

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Energy tariffs are higher due to the up front standing charges or higher cost of the first unit usage....more expensive if on a meter.......food is more expensive if you can't buy in bulk or don't have the cooking equipment or facilities to make your own.....any kind of credit costs more and with private rent you get less space and facilities for more money......the list goes on.

Many people make lots of money directly and indirectly from the disadvantaged and low paid. ;)

Hence the great myth of the "benefit scrounger". These people are the conduit by which public money is recycled into private hands. Big business and finance need these people!

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Energy tariffs are higher due to the up front standing charges or higher cost of the first unit usage....more expensive if on a meter.......food is more expensive if you can't buy in bulk or don't have the cooking equipment or facilities to make your own.....any kind of credit costs more and with private rent you get less space and facilities for more money......the list goes on.

Many people make lots of money directly and indirectly from the disadvantaged and low paid. ;)

As Marx would say exploitation.

Line rental is another you can get a big discount from Talk Talk if you can pay up front for the whole year.

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As Marx would say exploitation.

Line rental is another you can get a big discount from Talk Talk if you can pay up front for the whole year.

People in insecure short term tenancies are reluctant to sign up for longer term contracts. In my last BTL most people used 3G Mobile.

Living in an increasingly student orientated town, you can get 9 month contracts from Virgin Media.

Land lines, so last century. :D

Edited by Secure Tenant

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  • 238 Brexit, House prices and Summer 2020

    1. 1. Including the effects Brexit, where do you think average UK house prices will be relative to now in June 2020?


      • down 5% +
      • down 2.5%
      • Even
      • up 2.5%
      • up 5%



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