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The reader, known only as Emma, says she had persistent debt for the past ten years, but was able to transform her finances.
She was able to reclaim £9,300 from payday loan companies after contesting the affordability and eligibility of her loan.
In total, Emma received money back from 61 of the 72 payday loans she borrowed from by complaining either directly or through the Financial Ombudsman.
Separately, the MoneySavingExpert reader has also been able to claim £800 in compensation and refunds for credit card charges and overdrafts.
Emma says that on Martin’s advice, Martin contacted all of the catalog and credit card companies she owed money to, agreeing interest-free payments and reduced payment plans to reduce her debts.
The money makeover means she has gone from debt of over £20,000 to debt free and has savings in less than a year.
Write to MSEEmma said: “Following your tips on how to recover payday loans, we have questioned the affordability and suitability of my loans and have addressed the majority of complaints (61 out of 72 payday loans in total) directly through the companies or through the Financial Ombudsman won.
“In total I have received interest refunds and compensation totaling more than £9,300. I have also received compensation and refunds separately for credit card charges and overdraft charges in total about 800 euros.”
How to recover money from payday loan companies
If you borrowed a personal loan that you can’t afford to pay back because the lender didn’t check your finances properly, you may be entitled to a refund.
Another way a personal loan could be mis-sold is if the cost or repayment schedule, as well as any fees, were not clear.
Not being warned about the risk of late refunds and how much you would end up paying back is also unfair selling.
In terms of being treated fairly, lenders are expected to offer you help if you tell them you are having a hard time and they should offer you free forms of debt advice.
If you believe you’ve been mis-sold, you’ll likely be refunded interest plus any fees and charges from the time you were treated unfairly.
Contact the payday lender or check the website for the address of the complaints department to file a claim.
It is best to do this in writing as you can track a letter to make sure it has arrived and they have received your complaint.
If you are having a hard time, you can contact the complaints website Resolver for free, which will help you with your complaint.
Resolver also helps to escalate your case, in case you don’t get a response.
If after eight weeks you do not hear from the lender or your complaint is rejected or you are not satisfied with the response, you can contact the Financial Ombudsman Service.
This is a free service to use. You must fill in the Complaint form Ombudsman to start the procedure.
If you think you’ve been mis-sold, it’s best to file your complaint as soon as possible, as dozens of lenders have gone bankrupt in recent years.
When a company goes out of business, it means customers run the risk of getting significantly lower payouts — or even discovering it’s too late to file a complaint.