2278% APR!

cm1179

cm1179

cm1179

Soldato
Joined
30 Sep 2009
Posts
3,626
http://www.quickquid.co.uk/fee-schedule.html

i just saw an advert for this service on the tv and thought i was seeing things. turns out i wasn't! luckily i am not in a position to require this service and wouldn't advise anyone to use it either.

surely there should be a law against this? how can this possibly do anything but make the situation worse for people?
 
cm1179 said:
http://www.quickquid.co.uk/fee-schedule.html

i just saw an advert for this service on the tv and thought i was seeing things. turns out i wasn't! luckily i am not in a position to require this service and wouldn't advise anyone to use it either.

surely there should be a law against this? how can this possibly do anything but make the situation worse for people?
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Agreed, those adverts make me rage. Kind of feel sorry for the idiots that get themselves into massive debt from using that service.
 
[TW]Fox;17411654 said:
Can we have a law against people too dim to understand why Apr is high on very short term loans?

It's getting boring now.
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i understand why it is so high, it doesn't stop the ridiculousness of it. i would wager that most of the people who take out this kind of loan don't understand it.
 
cm1179 said:
i understand why it is so high, it doesn't stop the ridiculousness of it.
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If you need to borrow £1000 to pay a car bill so that you can get to work and have to pay £50 for the privilege of having that money for a week, that works out to a crazy APR but it's about convenience. The "annual" rate has no meaning because you're not borrowing the money annually - you're borrowing it for a week.
 
cm1179 said:
i understand why it is so high, it doesn't stop the ridiculousness of it. i would wager that most of the people who take out this kind of loan don't understand it.
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Well it clearly states the number on the advert. It's their fault if they "don't get it".
 
cm1179 said:
i understand why it is so high, it doesn't stop the ridiculousness of it. i would wager that most of the people who take out this kind of loan don't understand it.
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it's effectively a service charge - why would you take the risk of loaning money to the sort of people who borrow £50 without ensuring a reasonable return. Given the short term nature of the loan APR becomes nigh on irrelevant and would not be a viable way to price it for the business.
 
Well looking at the example loan and using the worst credit rating, a £50 loan means you have to pay back £64.75. that's pretty good if it stops someone missing a payment on their mortgage or allows someone to get their car fixed and not spend money on taxis to work for 3 weeks.
 
cm1179 said:
i understand why it is so high, it doesn't stop the ridiculousness of it. i would wager that most of the people who take out this kind of loan don't understand it.
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So how much would you charge me to borrow 50 quid for a few days?

20% Apr?

That's a few pence a day, why lend for so little return?

These figures only come about because its the law to show Apr even though its totally unsuitable for short term borrowing.
 
not again :\

2000% APR on a £50 loan for two days comes to £4.15

Say you were about to go overdrawn at the bank. This costs in the region of £15-£20 depending on the bank. If you could get a loan at 2000% for 2 days which costs you £4.15, which would you choose to pay, the £20 in charged to the bank, or £4.15 to the loan company?

People who don't understand APR should avoid borrowing altogether, and avoid complaining about high APR when APR is only applicable via some advertising regulation stupidity.
 
Zzzzz not this again. I used wonga once when I changed phone contract and they debited me before payday, paid about £7 interest or something for peace of mind that I could make the phone payment. I used it as a last resort but people really don't understand!
 
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