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Old 13-06-2013, 18:27
Blondie X
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And there lies the rub, so to speak. If you use any of these payday loan companies properly and pay the money back within the recommended period of time - most likely within 4 weeks - then the interest you pay on top is next to nothing.

You only run in to problems if you go over that time period because that's when the ridiculously high APR kicks in.

That's why they're called "payday loans" because the whole idea is that you borrow X amount until you next get paid.
If you look on the website, their representative example shows if you borrow 200 over 28 days, the interest paid is 58 which works out to 378% which is hardly 'next to nothing'
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Old 13-06-2013, 19:10
Cloudbusting
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Just got back on DS and seen this, haven't had a chance to get on before as oh dear I work full time and pay my way and get into debt but responsible debt. So yes I am an adult out in the world !!!. I am compassionate but would not get into debt for a flat screen tv/playstation or whatever latest blooming gadget comes out. Don't judge me you know NOTHING about me.
You're judging people you know nothing about, though.

Also, by going on about flat screen TVs you sound like a government mouth piece who wants nothing more than to demonise people.
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Old 13-06-2013, 19:22
burbs
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They can still provide their service without charging as much interest as they do. That's why I call them parasites for, not because they're simply handing money out to people that has to be paid back with interest. It's how MUCH interest that I'm talking about.
I understand what you are saying, obviously they are charging an extortionate amount of money but that what business is all about is it not? Making the most profit from the service you provide?

Also I dont know where you would draw the line, where is an acceptable amount of interest to charge? 50% APR, 40% APR? If government were to get involved I dont know where they would draw the line. And if Government did involve themselves and these companies were not making the money they once were then no doubt they will not stick around in the industry anymore and then where are these people going to get the cash.

I understand the argument and I agree that the interest charged is ridiculous, its just the people who say I didnt know what I was getting involved in and cant pay it back that annoy me. And I disagree with the argument that these companies are parasites, they see a demand and they provide a service to fill the demand. They charge the interest rates that they do because they are providing a service to higher risk customers.
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Old 13-06-2013, 19:26
burbs
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Desperate people do desperate things. They should be protected from loan sharks like this. That is what government's are supposed to do . Not make the loan sharks government advisors.
Why do they need protecting from companies offering loans and charging interest? Are you telling me that these people cannot make the decision to say no I wont take that money because the borrowing rates are ridiculous and I cannot afford to pay back the interest??

Are you really telling me that we need to get rid of companies because there are people out there who are really that unhinged that they cannot say no?!
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Old 13-06-2013, 19:29
Blondie X
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Why do they need protecting from companies offering loans and charging interest? Are you telling me that these people cannot make the decision to say no I wont take that money because the borrowing rates are ridiculous and I cannot afford to pay back the interest??

Are you really telling me that we need to get rid of companies because there are people out there who are really that unhinged that they cannot say no?!
But don't you think these companies are aimed at people who don't really understand the consequences of debt? I doubt any of these people have a clue about APR, what the base rate is and what a normal interest rate is. They probably just think 'oh if I borrow 200 I'll have to pay back 250 next month'
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Old 13-06-2013, 19:49
JasonWatkins
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If you look on the website, their representative example shows if you borrow 200 over 28 days, the interest paid is 58 which works out to 378% which is hardly 'next to nothing'
I forget myself sometimes because I do occasionally type as informally as i would talk, and I know that forum etiquette doesn't allow that as facts need to be checked and double checked for accuracy and many things are also taken quite literally*

But don't you think these companies are aimed at people who don't really understand the consequences of debt?
I don't. But then I generally object to the general notion that companies like this and businesses like Cash Converters "prey on the vulnerable" as well. As I said earlier in the thread, I would expect that at a bare minimum, they'd be required to say to the person "if you borrow X, and pay it back by this date, you'll pay Y amount on top".

"The vulnerable" generally aren't stupid though. I've been in Cash Converters enough times to know that the majority of the people i've seen pawning their items in there are fully aware of the interest they would have to pay on top. When you complete a transaction in Cash Converters, you're told that "This amount is what you need to pay to buy it back and this amount is what you pay to renew it for another 30 days".

I'd say that the same principle would certainly extend to payday loan companies.




*yes, I was being facetious
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Old 13-06-2013, 19:53
Blondie X
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I forget myself sometimes because I do occasionally type as informally as i would talk, and I know that forum etiquette doesn't allow that as facts need to be checked and double checked for accuracy and many things are also taken quite literally*
Or maybe some of us have 20+ year careers in the financial sector and know interest rates, lending criteria, APR and just about all there is to know about banking matters. So excuse me if I don't apologise for getting my facts right.
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Old 13-06-2013, 19:57
Blondie X
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I don't. But then I generally object to the general notion that companies like this and businesses like Cash Converters "prey on the vulnerable" as well. As I said earlier in the thread, I would expect that at a bare minimum, they'd be required to say to the person "if you borrow X, and pay it back by this date, you'll pay Y amount on top".

"The vulnerable" generally aren't stupid though. I've been in Cash Converters enough times to know that the majority of the people i've seen pawning their items in there are fully aware of the interest they would have to pay on top. When you complete a transaction in Cash Converters, you're told that "This amount is what you need to pay to buy it back and this amount is what you pay to renew it for another 30 days".

I'd say that the same principle would certainly extend to payday loan companies.
But thats not what I said was it? Someone may be totally aware of how much they have to pay in cash terms but do you honestly think they know what the BOE base rate is, the standard lending rates that most lenders charge and how to compare APRs?

As I actually said in the part you chose not to quote '
They probably just think 'oh if I borrow 200 I'll have to pay back 250 next month'
which I don't think is far wrong in a lot of cases
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Old 13-06-2013, 19:58
zx50
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I understand what you are saying, obviously they are charging an extortionate amount of money but that what business is all about is it not? Making the most profit from the service you provide?

Also I dont know where you would draw the line, where is an acceptable amount of interest to charge? 50% APR, 40% APR? If government were to get involved I dont know where they would draw the line. And if Government did involve themselves and these companies were not making the money they once were then no doubt they will not stick around in the industry anymore and then where are these people going to get the cash.

I understand the argument and I agree that the interest charged is ridiculous, its just the people who say I didnt know what I was getting involved in and cant pay it back that annoy me. And I disagree with the argument that these companies are parasites, they see a demand and they provide a service to fill the demand. They charge the interest rates that they do because they are providing a service to higher risk customers.
Well, it's obvious that we see things differently then.
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Old 13-06-2013, 19:59
burbs
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But don't you think these companies are aimed at people who don't really understand the consequences of debt? I doubt any of these people have a clue about APR, what the base rate is and what a normal interest rate is. They probably just think 'oh if I borrow 200 I'll have to pay back 250 next month'
Of course they think this but to be totally honest if they are old enough to take money off companies and spend it then they are liable for paying it back and accepting the consequences that come with it.

Why is there always some excuse for people shirking their responsibilities.
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Old 13-06-2013, 20:09
JasonWatkins
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Or maybe some of us have 20+ year careers in the financial sector and know interest rates, lending criteria, APR and just about all there is to know about banking matters. So excuse me if I don't apologise for getting my facts right.
You miss the point - I was "talking" informally. When I said "next to nothing" it was never meant to be taken absolutely literally. It was an informal expression - an exaggeration to make a point. I never intended to present it as absolute fact. I hope that clears it up ..

But thats not what I said was it? Someone may be totally aware of how much they have to pay in cash terms but do you honestly think they know what the BOE base rate is, the standard lending rates that most lenders charge and how to compare APRs?
Well no, I think it goes without saying that "the vulnerable" wouldn't know that information, but really only for the reasons you've stated ...

They probably just think 'oh if I borrow 200 I'll have to pay back 250 next month'
As long as "the vulnerable" are told the basic information regarding the transaction, regarding how much they have to pay, when they have to pay it and what happens if they don't pay it, any other information would generally be considered extraneous.
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Old 13-06-2013, 20:14
burbs
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Well, it's obvious that we see things differently then.
Of course we do, I see these companies provide a service for people who are unable to get loans anywhere else and for this reason they pay over the odds.

You believe these companies should be eradicated by the government because grown adults cannot take responsibility for their own lives and issues.

And you think if the government do eradicate these companies and cut the loan stream for these type of people then everything will be rosy and they will all live happily ever after.

Makes loads of sense, well done
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Old 13-06-2013, 20:38
zx50
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Of course we do, I see these companies provide a service for people who are unable to get loans anywhere else and for this reason they pay over the odds.

You believe these companies should be eradicated by the government because grown adults cannot take responsibility for their own lives and issues.

And you think if the government do eradicate these companies and cut the loan stream for these type of people then everything will be rosy and they will all live happily ever after.

Makes loads of sense, well done
You're making assumptions which shows that you've never read my posts properly. When did I say that these payday loan companies should be banned from offering their service?
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Old 13-06-2013, 20:46
burbs
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You're making assumptions which shows that you've never read my posts properly. When did I say that these payday loan companies should be banned from offering their service?
I have read your posts, apologies you did not say eradicate, you just said that the rates were too high. I was mixing you with another poster.
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Old 14-06-2013, 19:36
Kwazykat61
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[quote=Cloudbusting;66384602]You're judging people you know nothing about, though.

Also, by going on about flat screen TVs you sound like a government mouth piece who wants nothing more than to demonise people.[/QUOTE

Wrong again
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