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rowan · 12-23-2012, 05:58 PM

I looked up one of the places that was heavily advertising on TV. They charge $38 per $100 you borrow, with the loan repaid in 4 weeks, regardless of the loan amount. So a $1000 loan costs you $380 in "fees"

I think that means the effective p/a rate would be (38% / 4 weeks) * 52 weeks = 494% ?

There are also some pretty scary fees tacked on if you get behind: $30 missed payment fee, $50 arrears processing fee. So one late payment on a $200 loan and your balance increases by $80, presumably payable immediately... so instead of $50 that week you owe them $130.

I can see how people desperate enough to take out this type of ripoff loan could get even further into the shit. Payday loans are a scam that prey on the people who can least afford it.

12-23-2012, 05:58 PM
rowan Too lazy to set a custom title Join Date: Mar 2002 Location: Australia Posts: 17,393	I looked up one of the places that was heavily advertising on TV. They charge $38 per $100 you borrow, with the loan repaid in 4 weeks, regardless of the loan amount. So a $1000 loan costs you $380 in "fees" I think that means the effective p/a rate would be (38% / 4 weeks) * 52 weeks = 494% ? There are also some pretty scary fees tacked on if you get behind: $30 missed payment fee, $50 arrears processing fee. So one late payment on a $200 loan and your balance increases by $80, presumably payable immediately... so instead of $50 that week you owe them $130. I can see how people desperate enough to take out this type of ripoff loan could get even further into the shit. Payday loans are a scam that prey on the people who can least afford it.