talkmagic.co.uk

Things are on the up. I've been pre-approved to apply for a new credit card and it's only 39.9 APR

Oooooooh, that's good ..... *end sarcasm*

I have every sympathy for anyone struggling with debts, but I saw this....

"£275 borrowed for 22 days. Annual interest rate of 348% (fixed). Total amount repayable by one repayment is £354.75. 1737% APR Representative."

seriously, 1737% APR. Talk about exploitation and kicking people when they are down or desparate.

Discombobulator wrote:I have every sympathy for anyone struggling with debts, but I saw this....

"£275 borrowed for 22 days. Annual interest rate of 348% (fixed). Total amount repayable by one repayment is £354.75. 1737% APR Representative."

seriously, 1737% APR. Talk about exploitation and kicking people when they are down or desparate.

I was involved with setting up a credit union & 1737% is low by the standards of some. But don't get too fixated on the APR. A credit card company may have a seemingly low APR, but many however prioritise the way you are able to repay. Thus, some items you borrow are added to the end of your payment term. Thus if you never pay off the total amount, you always pay the full APR. Month after month, year after year & even with a seemingly low loan rate, (if you only look at the APR.) It ends up costing you a lot of money each year.
So short term loans can be cheap loans, despite the high APR. But some of these companies that do short term loans then try to encourage rolling over the loan or adding to it & thats where they become VERY poor value.
Also don't forget that some of these companies are happy to loan to people banks etc will not lend to. This means they have higher debt recovery & loss rates than a bank.
Also compare a total cost of under £80 to borrow £275 with what a bank charges for a single letter & is an APR of 1737% then so high?

Check out sites like Wonga - over 5,000% APR.......