"APR 1737% representative"

[swee'pea99]

Seriously. On an ad on telly just now. I always thought, say, 27% or 34% was a piss take, with base rates at bugger all or thereabouts, but 1737%? Jesus H.

 

[caimg]

Yeah short term loan lenders...not quite sure how it's legal. Not quite sure why anyone would use them. Finally, not quite sure why another company doesn't come along charging substantially yes, trump them all and still make a profit!

 

[Camrider]

1737% seriously undercuts Wonga's 4214%

 

[Camrider]

Or how about 14,348%

 

[caimg]

*substantially LESS, not yes...

 

[DiddlyDodds]

Yeah short term loan lenders...not quite sure how it's legal. !

I think they are legal as they dont come round and break your legs if you dont pay , prob just take you to court and take you house ,TV , furniture , kids (hide the bike away, that would be going to far)

 

[gbb]

There was a piece on this subject on R2 the other day. The interest rates are perfectly legal, there is no limit to what they can charge...where they have to be careful is ensuring the people they're lending to are capable of paying it back, the authorities are going to be investigating these type of lenders to ensure they are acting responsibly (which infers they're not..or why investigate)...and of course act responsibly and legally with people that fall behind.
The expert on the radio said you should look at the amount paid back over the term, not the interest rate. Make sure you're capable of paying it, make sure you're happy with how much you've got to pay back...and these lenders provide a service to those that can't get a load any other way.

 

[ohnovino]

According to Martin Lewis' blog, going overdrawn with Lloyds could see a charge at 7,500,000,000,000,000,000,000,000,000,000,000,000,000,000,000,000,000,000,000,000,000,000,000,000,000,000,000,000,000,000,000,000,000,000,000,000,000% APR

 

[Nearly there]

These pay day loan adverts make my blood boil in times of economic struggle for many these leeches target desperate people.How can the APR be legal its ridiculous,It should be reviewed asap.

 

[swampyseifer]

Dont forget that the figure is for an ANNUAL interest rate and these payday loans are for you to pay back only over the course of a month of two...so really if you took a loan out to pay back within 30 days, surely you'd need to divide the apr by 12 to actually see what the apr is for the month you'll be using it?

 

[Andrew_P]

Scum, more worrying is that they can afford all this advertising, national TV etc which means they are making lots of money and lots pf people must be using them which I find really depressing.

 

[Arch]

These pay day loan adverts make my blood boil in times of economic struggle for many these leeches target desperate people.How can the APR be legal its ridiculous,It should be reviewed asap.

Desparate people perhaps, also those who haven't learned to live within their means and have a buffer in the bank.

I can't imagine being in a job and getting to a stage where I needed a short term loan to survive at the end of a month - by which I mean pay for food or a bill, not replace my laptop like the lady in the ad....

 

[MacB]

Dont forget that the figure is for an ANNUAL interest rate and these payday loans are for you to pay back only over the course of a month of two...so really if you took a loan out to pay back within 30 days, surely you'd need to divide the apr by 12 to actually see what the apr is for the month you'll be using it?

As you mention APR is annualised and the main reason to keep using APR, IMO, is for comparative purposes. More people understand the term and it's much easier to compare multiple offers if the same baseline is given.

As for the right or wrong of it, usury is usury or loan sharking is loan sharking - all the spin in the world doesn't change somethings basic nature. It's another of those indicators where the root causes are actually much more important. All the things that increase in hard times are increasing as you'd expect, but the underlying factors go back further than the current crisis. Easy credit and the welfare system have gone a long way to masking the earlier indicators. People in full time work, or even multiple jobs, need welfare topups and also resort to credit, now spiralling down to loansharks as a source.

It won't be fixed, or at least not in a way that works for most people unless wages increase, capital controls are introduced and there is some sort of upper earnings limit via a multiplier effect. If people have the ability to exercise genuine freedom of choice then the vultures have leaner pickings.

 

[Davidc]

True capitalists. Meeting the needs of onsumers with the right product.

Criticising them is anti-business so please stop doing so.

 

[marinyork]

It simply reflects that our credit laws and regulations are as other campaigners said literally decades out of date. We have very relaxed credit in an era of low wages, high expectations, high inequality and instant gratification.