*cough* *splutter*

[wafflycat]

Just seen an advert of the idiot box (whilst sipping a cuppa of my late lunch). Advert came on for a finance company...

Want money quickly.. the usual stuff.

APR..


wait for it...



wait...



sit down...




2356%

 

[rich p]

Are you sure?

How did they phrase it?

 

[mr Mag00]

yup seen that ad too!

 

[ChrisKH]

I knew there was something wrong when my five year old (as he was then) asked me if I needed to consolidate my debts so I had just one easy monthly repayment.

 

[abchandler]

How did they phrase it?

I saw one about a 'payday' loan. A 30 day loan at 9.9%

 

[Vidor06]

Saw that one myself. They are not even trying to hide the APR either. It is big and bold at the bottom of the screen. I think it is one of those companies that lend you £50 until the next pay day and then you pay them back £60. Makes the APR on credit cards seem reseaonable all of a sudden.

 

[rich p]

If you borrowed £50 and paid it back after 30 days what would be the amount due at a rate of 2356% pa?

 

[abchandler]

£147ish I think

146.82 = 50 + (50 x 2356 / 100) x (30 / 365)

Calculation corrected below

 

[2Loose]

98quid by my reckoning, now where's an accountant when you need one?

 

[gbb]

I saw that too...2000+% ???
I thought at the time...how in the world can they get away with it ?

 

[Paulus]

They do mention towards the end of the advert that you should not use their facilities as a long term loan. I should think not. At that rate you would be bankrupt after a couple of months. Unfortunately there will be some people who are desperate for money who will take up their kind offer.

 

[SavageHoutkop]

94.65 : 50*(1+2356)^(30/365)

APR is supposed to be annual effective hence the power rather than additive.

abc - you've got the original 50 in there twice I think.

 

[abchandler]

94.65 : 50*(1+2356)^(30/365)

APR is supposed to be annual effective hence the power rather than additive.

abc - you've got the original 50 in there twice I think.

£65.05

Surely you have to divide 2356 by 100 then? Otherwise substituting 100%APR for a 1 year period means you pay £5050 back after a year.

And 50 * (1 + x) is the same as 50 + 50x, so the original 50 should be there

 

[Globalti]

It's usery. I shall have them evicted from the temple.

 

[twentysix by twentyfive]

I'll lend my dosh (what I've borrowed from my credit card) at that rate