Gold, cash, credit.
Dec. 23rd, 2009 12:33 pm![[personal profile]](https://www.dreamwidth.org/img/silk/identity/user.png){kind=small}
sobriqueOK, so whilst on holiday not so very long ago, I had access to a TV. This is not a usual occurance, but I haven't really missed it.
Anyway, what I spotted was a company called 'Quick Quid' offering 'pay day loans'.
It's where they offer you cash _now_ that you repay with interest on pay day.
But what .. actually quite horrified me is the APR on those loans.
"Typical 2356% APR"
I've found another one that will offer you a 30 day loan, and charge you £25 per hundred you borrow. Which ... is 25% a month.
Or 1455%/year.
Seriously? Do we have people who are so out of control of their finances that that looks like a good deal? I'm used to the notion that a credit card that charges 25% A YEAR is a bit on the high side. My current credit card is 16.9% APR - I could do a bit better than that, but I wanted a charity card because of the way I spend on it. So that's 1.313%/month. (Slightly higher 1.941% if I want a cash advance, rather than paying by card). Although technically speaking, my interest rate is 0%, because you get a month (up to 30-59 days depending on when your statement is due) interest free.
Not 25% a month. Not 1455% a year. That percentage is an easy number to read - it means that over the course of a year, you give them nearly 15x what you borrowed.
That ... well, frankly that just disgusts me. If you have someone who's having financial difficulties to the point where they can't do that, then they're pretty close to the wire, financially. That's not helped by offering credit at that sort of term and rate.
Credit cards aren't particularly cheap borrowing either - they're just convenient.
The sites in question:
http://www.paydayfinancial.co.uk/payday-loan/rate_and_terms.html
http://www.quickquid.co.uk/payday-loans.html
The really horrifying thing though, is that these companies _aren't_ the last resort. They're just louder about shouting 'pick me, pick me' when someone's really suffering.
You have credit unions - that aren't well advertised, because they're voluntary/profitsharing entities.
Stuff like:
http://www.rugbycreditunion.co.uk/
There is a credit union in Coventry, too - but they don't have a website, they're that ... well, focussed really.
But deals are similar - the Rugby Credit Union offers around 13% APR (1%/month), and they will lend to people who might otherwise be rejected for credit from a larger, profit making organisation.
Seriously, these 'pay day loans' are bottom feeding parasites - they don't even offer a 'last resort' sort of a service.
On a related note, we have similar bottom feeders buying gold. You must have seen the adverts - 'gold in the post, cheque by return'. And yet, it seems they have trouble with the notion of paying a fair rate too - BBC Article on gold fror cash. In short, none of the companies doing it, offered more than half the value of the gold at first pass, and even with rejecting the offer, most didn't actually go above two thirds.
The worst offender offered £60 for around £300 worth of gold.
Again, this isn't a 'last resort' sort of a service, either. Gold is an internationally traded commodity, and it's got a published value per gram. LOTS of companies will buy gold, and whilst they're all interested in making a profit, most are happy with a sensible margin -
"We double-checked and took the gold anonymously to a number of shops in London's famous old jewellery market, Hatton Garden, specialising in scrap metal.
Sure enough, the best price we were offered was £318. "
Seriously, this sort of thing is ... at best, crooked, and at worst exploitative.
Anyway, what I spotted was a company called 'Quick Quid' offering 'pay day loans'.
It's where they offer you cash _now_ that you repay with interest on pay day.
But what .. actually quite horrified me is the APR on those loans.
"Typical 2356% APR"
I've found another one that will offer you a 30 day loan, and charge you £25 per hundred you borrow. Which ... is 25% a month.
Or 1455%/year.
Seriously? Do we have people who are so out of control of their finances that that looks like a good deal? I'm used to the notion that a credit card that charges 25% A YEAR is a bit on the high side. My current credit card is 16.9% APR - I could do a bit better than that, but I wanted a charity card because of the way I spend on it. So that's 1.313%/month. (Slightly higher 1.941% if I want a cash advance, rather than paying by card). Although technically speaking, my interest rate is 0%, because you get a month (up to 30-59 days depending on when your statement is due) interest free.
Not 25% a month. Not 1455% a year. That percentage is an easy number to read - it means that over the course of a year, you give them nearly 15x what you borrowed.
That ... well, frankly that just disgusts me. If you have someone who's having financial difficulties to the point where they can't do that, then they're pretty close to the wire, financially. That's not helped by offering credit at that sort of term and rate.
Credit cards aren't particularly cheap borrowing either - they're just convenient.
The sites in question:
http://www.paydayfinancial.co.uk/payday-loan/rate_and_terms.html
http://www.quickquid.co.uk/payday-loans.html
The really horrifying thing though, is that these companies _aren't_ the last resort. They're just louder about shouting 'pick me, pick me' when someone's really suffering.
You have credit unions - that aren't well advertised, because they're voluntary/profitsharing entities.
Stuff like:
http://www.rugbycreditunion.co.uk/
There is a credit union in Coventry, too - but they don't have a website, they're that ... well, focussed really.
But deals are similar - the Rugby Credit Union offers around 13% APR (1%/month), and they will lend to people who might otherwise be rejected for credit from a larger, profit making organisation.
Seriously, these 'pay day loans' are bottom feeding parasites - they don't even offer a 'last resort' sort of a service.
On a related note, we have similar bottom feeders buying gold. You must have seen the adverts - 'gold in the post, cheque by return'. And yet, it seems they have trouble with the notion of paying a fair rate too - BBC Article on gold fror cash. In short, none of the companies doing it, offered more than half the value of the gold at first pass, and even with rejecting the offer, most didn't actually go above two thirds.
The worst offender offered £60 for around £300 worth of gold.
Again, this isn't a 'last resort' sort of a service, either. Gold is an internationally traded commodity, and it's got a published value per gram. LOTS of companies will buy gold, and whilst they're all interested in making a profit, most are happy with a sensible margin -
"We double-checked and took the gold anonymously to a number of shops in London's famous old jewellery market, Hatton Garden, specialising in scrap metal.
Sure enough, the best price we were offered was £318. "
Seriously, this sort of thing is ... at best, crooked, and at worst exploitative.
