To wonder how this is legal
Bluepansies · 02/08/2017 17:20
I've just seen a TV ad for a company offering loans at 1035% apr. I thought the one I saw the other day that was 79% apr was bad enough but this is insane - surely you'd have to be in a pretty desperate financial situation to go for this in which case this is unbelievably exploitative. The only other reason I can think of for someone to take one out is if they were very inexperienced and/or uneducated when it comes to finances in which case it's equally exploitative.
How is this allowed?
MaidOfStars · 02/08/2017 17:26
surely you'd have to be in a pretty desperate financial situation to go for this
in which case this is unbelievably exploitative
I don't think these loans are designed to be held for a year. Most people might reason that, in a tight spot, paying a fiver a week to borrow a hundred for a month is a pretty decent deal. That works out at !200% APR.
I'm not necessarily defending these types of loans, and I think there are many defaulters (quite simply because a fiver a week for a hundred borrowed over a month doesn't seem like a bad term to default on) but I think the phrase "payday" loans should be borne in mind.
Bluepansies · 02/08/2017 17:34
I can't remember the name of it but it featured a man folded up in a cardboard box. The 79% one was Amigo loans I think, they offer loans to people with bad credit as long as they have a guarantor. I think they're up to 5 or 10 grand so definitely designed to be held for more than a year! Awful.
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