A friend of mine has a loan to help repay some debt. Having told me who it was with, I just looked them up on the web to see if he is getting a good deal. He is in all sorts of trouble financially.
The site says that they take over the debts you have and having negotiated that interest on the debts is frozen, they make payments for you. They charge 15% each month for doing that.
What APR does that equate to? Surely not 12 x 15%?
Further details on their site:
"...subject to a minimum of £25.00 and a maximum of £100.00"
...makes it impossible for this question to be answered without more info.
I just called them for clarification. They said that if for example, the repayments agreed with the creditors each month was £100 then my payment to them (Greg Pen) would be £125. If it were a greater amount, ie. £200 per month then the amount payable to them is £230. If the repayment amount was much higher, the cut for them is capped at £100.
Is this good or what?? Assume that my friend is paying £125 per month towards a total debt of something like £10k. I don't know exact figures and this is my best guess at his debt. He did say it was going to take about 6 years to pay it off.
Paying someone to reorganise your debts is never a good deal. The CAB will do it for nothing.
tim
Agreed.
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