"BACK TO THE BLACK" UPDATE

Belated posting about another radio interview, following the launch of the free edition of “Back To The Black”.

This was with Heart FM in Bristol, (formerly GWR FM Bristol) who sent their reporter Chas Rowe to interview me at home. The station had told me that clips / soundbites from the interview would be broadcast during their news bulletins last Monday, i.e. 18 January, aka “Blue Monday”. This is a day which has apparently been “scientifically proven” to be the most depressing day of the year. Heart FM said that the launch of my book was a good news story they’d like to run on that day, which was encouraging to hear.

Apart from the questions I’d expected, was one about payday loans: would I advise anyone cash-strapped at the end of January to take out one of these loans? This is a tricky matter: anyone considering any such loan must have exhausted all other possibilities. These loans, for sums up to £1000, are known to carry very high interest rates but they are marketed as instantly available, which of course is very attractive when things are tight.

If the sum is repaid very quickly then paying that interest may be better than having to default on the mortgage or a credit card bill; the problem arises however if the sum isn’t paid quickly. I said that if anyone was in a situation where they saw no alternative solution by month-end, then they could take the loan provided they immediately set in place a debt management plan, e.g. with the help of Citizens Advice, or CCCS (Consumer Credit Counselling Services), or some other local independent debt advisory service, and then repaid that loan as a first priority.

For the record, an online resource lists the top 5 payday loan providers ranked by “rough estimate of lender’s approval rates”. The APRs of these lenders varies from 994% to 2339%.

For extra info see a posting on the MoneySavingExpert website:

http://www.moneysavingexpert.com/news/loans/2010/01/loan-sharks-leaving-victims-in-debt-all-year

Finally, credit unions are an alternative and much cheaper source of short-term finance that people in this situation could look at. Here in Bristol (UK), for example, they can be found at http://www.bristolcreditunion.org/ and offer loans from £100 to £7500. Their website says: “By law credit unions cannot charge any more than 2% per month on the reducing balance of a loan. This represents a maximum interest rate of 26.8% APR (Annual Percentage Rate), and that is the most you will ever pay on your loan.”