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jonjk

Loans

23-Sep-11 01:10

In the UK we have several short term loan companies operating offering cash at high interest rates.

One inparticular has been highlighted by Martin Lewis and if you borrowed £100 and didn't pay a penny back, in 7 years your debt would be in excess of the US national debt, $16 trillion.

I thought our government had cracked down on loan sharks, seems they've just legalised them.

Are there(legal)loan interest rates in excess of 1500% APR anywhere else in the world or is it just the UK? As always, it's the most vulnerable who bear the brunt.

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T4Texas

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23-Sep-11 05:44

In the US we have very similar things but, I think that there is a "cap" on how much interest they can charge you. I am not certain though.

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DanajustDana

23-Sep-11 05:52

Here in the states they have what are known as payday loans, car title loans & cash advance, the highest interest I'm aware of is 999%, these are good places to avoid, it's another case of the educated taking advantage of the uneducated. They should be illegal, but they seem to have become more prevalent, along with the buy here, pay here car lots, which should also be illegal.

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happyhumper69

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23-Sep-11 19:51

I've seen one finance company here that has high interest...but not that high

One of my friends financed a car through American General years ago...a $5000 car ended up costing about $13000 after the interest was figured in

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jonjk

24-Sep-11 00:28

One inparticular has been highlighted by Martin Lewis and if you borrowed £100 and didn't pay a penny back, in 7 years your debt would be in excess of the US national debt, $16 trillion.

Apologies, I misread, the figure is $10 trillion not 16.

The company in question today replied to Martin Lewis and I've never seen so much drivel about a financial issue. They pointed out that clients know what the interest rates are, true, and they don't hide anything, also true.

That said, they made no apology for taking advantage of people who most likely have no other place to turn. If your credit ratings not good then cards are out, overdraft facilities curtailed and the only course open are these sharks.

Be interesting to see how this pans out.

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