Loan sharks charging 500%-700% interest.

[JLM]

I just heard on C.B.C. news that these payday loan bastards are charging exorbitant interest rates. Anything over 10% these days is usurous. Is it time a law was passed? The only reason I can think of that it hasn't already been done, is the politicians are probably the same bastards that own the business. - BASTARDS! 8O

 

[TenPenny]

There are already laws passed, and if you think 10% should be the limit, what about Visa, MC, etc?

The way these guys do it, is that much of this cost is in fees.

 

[china]

Hang them loan bastards .That's what they would do in China ,seriously ; well perhaps not hang them...... something less painful .

 

[TenPenny]

I actually know someone who owns one of these places, and the vast majority of her customers are people who come in every couple of weeks to get an advance on their paycheck so they can buy drugs and/or alcohol.

So, I have no sympathy for those people. It's one thing if you need it for essentials, but that's the tiniest of minorities, the vast majority are people who simply can't stand to wait a couple more days for their pleasure.

 

[JLM]

There are already laws passed, and if you think 10% should be the limit, what about Visa, MC, etc?

The way these guys do it, is that much of this cost is in fees.

Visa and Mastercard are not particularly ethical in my opinion, but they do leave a loophole for you. Pay the account in full every month. :smile:

 

[TenPenny]

Visa and Mastercard are not particularly ethical in my opinion, but they do leave a loophole for you. Pay the account in full every month. :smile:

The payday loan people have a loophole, too. Don't use them, and you don't have to pay any fees.

I notice on credit card bills, there's now a statement of how long it takes to pay off if you only pay your minimum payment. I always pay my bill in full each month, but I had to laugh at this month's bill:

'...assuming that the entire balance is subject to the Purchase Rate and you only make the minimum payment each month on the due date: 15 years, 10 months.'

 

[dumpthemonarchy]

Yeah, but they don't break your legs.

 

[JLM]

I actually know someone who owns one of these places, and the vast majority of her customers are people who come in every couple of weeks to get an advance on their paycheck so they can buy drugs and/or alcohol.

So, I have no sympathy for those people. It's one thing if you need it for essentials, but that's the tiniest of minorities, the vast majority are people who simply can't stand to wait a couple more days for their pleasure.

Professional people (proprietors of finance companies) shouldn't be taking advantage of stupid people's weaknesses, nor I doubt if it's really any of their business what they spend the money on. :smile:

The payday loan people have a loophole, too. Don't use them, and you don't have to pay any fees.

I notice on credit card bills, there's now a statement of how long it takes to pay off if you only pay your minimum payment. I always pay my bill in full each month, but I had to laugh at this month's bill:

'...assuming that the entire balance is subject to the Purchase Rate and you only make the minimum payment each month on the due date: 15 years, 10 months.'

While we are on the subject, I've found through experience that M/C is almost as bad (if you are both charging purchases and taking out cash advances pay very close attention to exactly where your payments are applied and in what order) Probably not 500% but under certain circumstances possibly 50%. After two or three months I caught on to their scam and complained bitterly, paid the advance off immediately and did manage to recoup all the interest I had paid. They are very sneaky. :smile:

 

[Bar Sinister]

As mentioned there are regulations in place governing these modern loan sharks. For the most part they charge only about 3% interest. However, that is 3% per month. Taken over a year that amount is closer to 36% which is a bit exorbitant. Part of the problem is that some people, due to the transitory nature of their existence or because they are not yet Canadian citizens with full time jobs, cannot get bank accounts and are forced to go to places like MoneyMart in order to cash their already small paychecks.

 

[JLM]

I was thinking back on this scam I walked into with Mastercard (they are almost as corrupt as the loan sharks). They offered me a cash advance at ridiculously low interest so I took out $3000 to pay down some debt. I was also charging purchases on the card which I paid off monthly in full. So at the end of the I would make a payment on the cash advance (at around 3% interest) plus I would pay off my purchases in full. After a couple of months of doing this I noticed gross irregularities so contacted Mastercard. Well, what they told me blew my mind. As long as you are still paying on the cash advance, ALL AND ANY payment you make goes toward the cash advance while the debt on your purchases continues to accumulate at 28% interest. Lovely!!!!!!!! But it is in the fine print.

 

[Dexter Sinister]

But it is in the fine print.

So I suppose the lesson there is, always read the fine print. Realistically though, it seems perfectly simple to me: don't buy things you can't afford. If you can't pay off your credit card debt in full every month, you're living beyond your means and you're going to get into trouble. A credit card is the worst possible legitimate way to borrow money, the interest rates will beggar you.

 

[damngrumpy]

There is a maximum amount of interest that can be charged but It is high and i can't
remember what the rate is. As for people taking loans, there is nothing one can co
as people have freedom of choice. Most people are not stupid they are desperate and
that is worse. I think there has to be a complete review of all rates and charges and
the interest and loan laws must be brought up to date. If they can raise the age of
consent after a hundred years, they can do this in a timely manner. There is no
political will to do this and that is the major problem

 

[JLM]

So I suppose the lesson there is, always read the fine print. Realistically though, it seems perfectly simple to me: don't buy things you can't afford. If you can't pay off your credit card debt in full every month, you're living beyond your means and you're going to get into trouble. A credit card is the worst possible legitimate way to borrow money, the interest rates will beggar you.

Absolutely, I've always tried to play it smart when it comes to money. Use the credit card to take advantage of sales, but pay it in full each month. I have a credit card where I actually get 1% back at the end of the year, so every major purchase goes on it. Of course the banks with their feeble minds think every one is just going to go on a spending spree and unwittingly get themselves into a position where they are making monthly interest payments.

 

[captain morgan]

Of course the banks with their feeble minds think every one is just going to go on a spending spree and unwittingly get themselves into a position where they are making monthly interest payments.

You'd be absolutely shocked to find out exactly what % of people get caught up in that circle.

 

[JLM]

You'd be absolutely shocked to find out exactly what % of people get caught up in that circle.

I doubt it. Banks lend money to finance companies and they are engaged in a conspiracy to get gullible young people up to their necks in debt, so they reach the point (when their credit is no good with the bank) to resort to going to the finance company for "easy payments" (at 30% interest) so both the banks and the finance companies benefit. :smile:

 

[YukonJack]

In the early 1960's I worked at Denison Mines in Elliot Lake, Ont. Once I borrowed $50.00 from a guy, whose only occupation on the mine camp was loan sharking. He demanded back the double amount at next payday, which was two weeks away. I paid the bastard, and NEVER again did I do anything with slime like that, again legal or otherwise.

Nowadays, I don't even wait for my credit card bill to arrive in the mail. I am online, and use my credit card for everything, because at the end of the year I get back 1% of all previous year's purchases. I pay the billed amount on time and in full.

There is a word in American English (don't know if it is used in Canada): VIGORISH. That is the name of re-payments loan sharks demand.

 

[Machjo]

I just heard on C.B.C. news that these payday loan bastards are charging exorbitant interest rates. Anything over 10% these days is usurous. Is it time a law was passed? The only reason I can think of that it hasn't already been done, is the politicians are probably the same bastards that own the business. - BASTARDS! 8O

Islam forbids usury too; are you proposing that Canadian law take one more step towards shari'a?

Yes, yes, I'm joking of course. I would support some kind of restriction too. One other restriction I'd say is that if you lend money to a person whom you know to be below the poverty line, then he has no legal obligation to pay you interest on the loan. You're free not to lend to him of course, but don't lend to people who you know can't afford the interest. I bet a few banks and credit card companies would hate that law.

I actually know someone who owns one of these places, and the vast majority of her customers are people who come in every couple of weeks to get an advance on their paycheck so they can buy drugs and/or alcohol.

So, I have no sympathy for those people. It's one thing if you need it for essentials, but that's the tiniest of minorities, the vast majority are people who simply can't stand to wait a couple more days for their pleasure.

So if that person knows they can't pay it back, then he deserves what he gets when they can't pay it back.

 

[TenPenny]

So if that person knows they can't pay it back, then he deserves what he gets when they can't pay it back.

But they can pay it back, and they do, or else they don't get a loan the next month.

 

[Machjo]

But they can pay it back, and they do, or else they don't get a loan the next month.

Well then there's no issue.

 

[TenPenny]

The only issue seems to be in the minds of people who don't use these services, but want to feel outraged on the behalf of those who do use them.