Student Nightmares: Caught in the Evil Circle of Quick Loans - 4 min read

I F***ED UP!

You take one loan, then another to pay off the first one, and then another…Before you know it, you’ve worked up a debt you can’t repay. It’s sort of like that catchy Pringles slogan: ‘Once you pop—you can’t stop!

In January 2018, there were more than 212.000 people registered in the Danish debt registry due to loan defaults. Of these, 48.000 were between the ages of 18-30. Collectively, their debt amounted to 1.3 billion kroners. While 48.000 might not seem like a lot, in Danish numbers, that’s actually 5% of the total number of Danes in this age bracket.

Being a first-year student is hard. You want to fit in, join all the parties and not be the odd one out. FOMO is intense as a first-year student…and suffering from FOMO can be expensive! In Denmark (where you can find the Lix headquarters), quick loan companies prey on these types of students. But why?

Scandinavians are known to be independent, moving away from home a lot sooner than the average European—mainly to study at university. Finans Denmark surveyed young Danes and found that this desire to be independent is often what puts 18-30 year olds in debt in the first place. The urge to “do it all by myself!” makes it enticing for them to resort to quick loans.


And even when you don’t want a loan, you get bombarded by ads tempting you to do the exact thing you’re trying to avoid. I even tested it out myself—after a quick Google search, where I typed “avoid quick loans” in the search bar, I was blasted with a bunch of ads enticing me to take action. When you’re young and impressionable, it becomes mighty tempting to click that ‘Apply in 5 Min and Get Money’ ad. STOP — DON’T DO IT!


Being stuck in the registry leaves a mark on your overall financial reputation, which devalues your overall credit—leaving it open for all financial institutions to see. This means, despite getting out of the registry, you will still have a bad rep—kind of like a felon recently released from prison (OK, that’s a bit of a stretch). Worst case, you could be denied a loan for a house, car or another must-have item in the future—just because of a stupid quick loan to finance that bitchin’ new smartphone…#crap!


We spoke to financial advisor, Trine Andreasen, from Jyske Bank and together we created five pro tips to get you out of student debt—ASAP!

  1. CALL YOUR BANK. Yes, those guys (doh!). They are actually there to help you. It might seem like they just want all your money to cash-in on your interest rates…but the truth is—they need you! And they need you to be financially healthy. The more money you make, the more money they make. Most banks are able to help you set up a plan to repay your loans and get you back on your feet. They might even be able to give you a new loan that covers your other loans, at a much lower interest rate, to help you get out of the ever-tightening-quick-loan-wrench.

    According to Trine Andreasen, “at Jyske Bank, we encourage students to contact their bank before taking a quick loan. Students with established credit should first consider the overdraft option connected to their bank account. A quick loan should be the very last option.”
  2. CALL YOUR MOM (OR DAD). Yes, they will most likely tell you, ‘WE TOLD YOU SO,’ but once that burn has stopped stinging, they only want what’s best for you! Trust us—if they’re financially capable, they might cover your loan, and we bet the interest rate at “Parent Bank” is better than the rates you’ll get from quick loan scammers or your own bank. So, suck it up and ask for help. They just want their little pumpkin to be happy, right?
  3. CALL YOUR POWER SUPPLIER. Huh?? Okay, imagine this: bills are piling up—electric bills, water bills, heating bills, phone bills and oh yeah, quick loans. Anxiety is setting in. Take a deep breath. Call the respective companies sending you these bills and ask to get an installment plan. YES, you can actually do this! This way you can pay your bills in smaller portions and lighten your monthly load.

    And don’t forget to reach out to the quick loan company! Trine suggests, “if students have taken out a quick loan and are struggling to make the monthly payments, we advise them to contact the company and set up a payment agreement on the loan. What we often see is students taking out more and more quick loans to pay off their existing quick loans. This is a very bad spiral. If it gets to this point, we advise them to start repaying the loan with the highest ÅOP (yearly cost in percentage) first. We also advise them to stop taking out more loans.”

    Disclaimer: Not all companies do this (most do though)… and look out for extra charges (some are sneaky, but most are fair).
  4. GET FREE COUNSELING. Not your student counselor, silly —the debt counselor. There are multiple, FREE of charge debt counselors out there. In this capitalistic, money-draining world we live in, there are actual good-natured people out there ready to help. These guys (and girls) will help you set it all up and manage the whole mess. So, if the mess is leading to undue stress and you’re feeling overwhelmed, Google is your friend (in most cases), and with a quick search, you’ll find the nearest debt counselor who is ready to help.
  5. MAKE A NUGGET BUDGET. Using too much money on junk food? ‘Oh crap, it’s June—my insurance bill is due!’ Sound familiar? We have one last little piece of advice—make a budget! Budgets (especially budget accounts), make it all more manageable. And guess what, 9 out of 10 banks will help you set up a budget account and make all the calculations and monthly automated transfers happen-—for FREE!

So, whether you’re an ‘I’ll fix it myself’ type or an ‘I’m in over my head’ type, there is always help available and light at the end of the tunnel.

Pssst…this is why Lix offers a monthly subscription payment. This way, there are no nasty surprises on your bill and you always know what you’re paying next month…and the month after that…and the month after that. 😉

We get it—this is a tough topic, but #sharingiscaring. So if you have a story you’d like to share with your fellow Lix’ers and students, leave us a comment below.

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