People who still have a loan from Wonga that has not been paid are getting emails with what sounds like a tempting offer:
Loan settlement offer to restore your credit record.
The offer details are:
- you only have to pay about 25% of the debt;
- the debt will be deleted from your credit record if you accept the offer;
- it says the offer is “time-limited” but doesn’t give a date you have to accept it by.
Here a couple of examples:
Today I received an email from Wonga with a reduced pay off deal on my Wonga loan. The offer is £250 to pay off my £1000 loan.
I’ve had a loan outstanding with Wonga for £680 since they went bust, hence I stopped repayments based on a claim I had with the FO. I’ve just received a settlement offer from Wonga of £160.
If you have had this offer, don’t rush to accept it if you have made a Claim for a refund to the administrators for unaffordable loans!
Why is Wonga making this offer?
Wonga went under in 2018. The Administrators are currently selling off its assets to get money to pay Wonga’s debts. See Wonga – the Latest news about refunds for more details.
If you still have a loan from Wonga that hasn’t been paid, Wonga wants to try to get as much money from the loan as possible.
In this situation, Administrators normally try to sell all the loans to a debt collector. They have talked to debt collectors but in August this year they announced that they hadn’t had an offer which they thought was suitable, so they would not be “selling the book”.
The only other way for them to try to get any money is to offer the borrowers a discount to settle – hence this 75% off.
Is it a good offer for you?
This depends if you have made a Claim to the Administrators for a refund. If you haven’t already done this, it is too late now as the deadline for claims has passed.
There are three cases:
1) Wonga has agreed you should get a refund
[UPDATED] I have been told by the Administrators that these offers should not be going to people who are owed a refund that is larger than their debt.
A few emails were incorrectly sent out to some people in this situation. They should now have been contacted and told this is an error.
Also if you are owed a refund that is smaller than your debt, you should not have received this letter as a separate offer will be made to you later taking account of the refund.
2) You haven’t made a Claim for a refund – or it has been rejected
If you haven’t made a Claim, then these calculations aren’t relevant.
75% off sounds like an OK offer, especially as they will delete the default from the credit record. If you can afford it of course!
It’s not clear if you could get a better deal by waiting.
I suppose they could offer you more off in a few months. Or give up and write the debt off, where all you will have lost is the chance to get the default deleted from your credit record.
If your debt is in a debt management plan, you could talk to your DMP providers about what you should do. If it isn’t, then you can get advice from one of the Debt Advice contacts given in the email from the Administrators.
3) You have put in a Claim but it hasn’t been assessed
Here you don’t yet know which situation you will be in.
If you had lots of loans you probably will get a refund. If you only had two or three it will probably be rejected. But at the moment you are guessing.
I suggest you wait a few weeks. I doubt this offer will disappear soon, or they would have said what the time limit was to persuade you to act fast.
Updated 24 October