Payday loans

[MissB]

:rofl:

I'm sorry. I'm still laughing at this LTTE in our paper this morning. I'm trying to figure out if he was being sarcastic or perfectly serious.

http://www.oregonlive.com/letters/oregonian/index.ssf?/base/editorial/1145320033299900.xml&coll=7&thispage=3

Loan company cuts rates


The news industry never ceases to amaze me, as well as our local politicians. The payday loan companies have been demonized and besmirched by the media and politicized by Oregon politicians running for re-election. They don't have time to say anything about the payday loan company that is actually doing something to make the loan companies more equitable for the consumers.

My company, PayCheck Advance Northwest, has cut the interest rates nearly in half. That is, we have reduced the annual percentage rate from 521 percent to 312 percent, which is equivalent to $12 per $100 loaned.

Do you think the media or any of the politicians would alert their constituents to the windfall? Not a chance. A normal person would see this as news. I guess if it's not down and dirty, or if it can't get votes, then it's not news. Who is looking out for the people?

RICHARD M. DUVALL, Northwest Portland

[Peanutcat]

1. "Who is looking out for the people?"

Not you, that's for damn sure!

[terrya]

2. I'm guessing he's being sarcastic.

Unfortunately, having dealt with them in the past, this guy isn't completely exaggerating. These companies are glorified loan sharks...ridiculously high interest rates.

If he was serious, I can't believe he would own up to the onerous interest rates these companies charge.

[MissB]

9. Apparently he was perfectly serious.

http://www.oregonlive.com/printer/printer.ssf?/base/news/1140679510169990.xml

No more blank checks for Portland's payday lenders
Personal finance - Portland passes a law to regulate its 69 shops; other cities plan to follow
Thursday, February 23, 2006

BILL GRAVES
The Oregonian

*snipped a bunch of the article to get to the relevant part*

Lenders urged the City Council to delay action. Richard Duvall, owner of Paycheck Advance Northwest Inc. in Northwest Portland, said if lenders treated people poorly, they would go out of business because borrowers would not come back.

"How about individuals being responsible for themselves?" he asked.

[hfojvt]

13. part of the reason people keep coming back

is because his product is addictive, in a way. Some people cannot keep up with their finances. So they get one of those very high interest loans. Logically, with the extra expense of interest payments, it is not going to be easier to keep up. It is going to be harder.

A great thing about it, for them, is that the state subsidizes their business - by prosecuting people who write bad checks. It cuts their risk way down, but not their rates.

[bunkerbuster1]

3. Down to 312 percent?

This is a parody, right?

[Goblinmonger]

4. They dropped their rates that much ?!?!?!

I wonder if they would do the mortgage on my new house?

[5X]

5. Your newspaper fell for an old trick...

they just got free advertising.

[hfojvt]

11. lots of the articles in the paper

are free advertising. Probably the place runs ads too, so they owe them one.

[SofaKingLiberal]

19. Some ads are actually disguised as articles.

That is, companies pay the paper to print the article.

[BOSSHOG]

6. We had to order our young Sailors

to stay away from those places outside the gate. They would rape and pillage a poor Sailors paycheck in no time without a thought of right and wrong. I think he's serious. I've seen the bills our kids got stuck with. We spent a lot of time getting our Sailors out of financial trouble.

[mike_c]

7. my god, that's almost down to 14 ounces of flesh....

:nuke:

[Selatius]

8. 312 percent APR? Compounded monthly?

If it's monthly, then that comes out to 26 percent a month.

I'm sorry, but 26 percent a month is fucking insane.

[oscar111]

12. LAW against usury, years back.. what was "usury" rate then? ten percent?

I have been told that back in the sixties, usury was illegal in the USA.

what was the rate that was illegal then?

the GOP since then has made crime legal, literally , .. in many areas of life.

Any scholar know the usury rates down thru the centuries? I know the Middle Ages had the term, so usury must have been illegal down the centuries.

Is ANY rate illegal now? How wild have the republicans gotten?

What was the mafia rate , in their infamous "factory gate payday loan" activity? Back in the early twentieth century?

[MindPilot]

14. IIRC credit card interest was capped at 8%

AND it was deductable. OTOH, banks and department stores didn't hand out credit cards like they were candy.

[hfojvt]

15. it is compounded every two weeks

12% every two weeks. Something like 27.8% a month would give you the same APR.

[hfojvt]

10. those poor loan sharks

His rate is actually 1,804% but who's counting anymore. They figure 12% times 26 is 321%, but that is not compounding. It should be 1.12 to the 26th power minus 1 and then times 100 for the percentage of 1,804%. That is good news though, I guess. Since they used to charge $20 on a $100 loan, their old rate was 11,348%.

And people think credit cards and auto dealers are bad. Those places should pay an 80% tax rate - force them out of business, but instead they seem to be the fastest growing "industry" in my town. I have 3 of them within 6 blocks of me.

[RB TexLa]

16. Hope I don't get skinned for this

I loaned my brother $20 last month, he paid me back a week later. He paid me $20 a 2-liter Diet Coke and a pack of cigarettes. So $1.50 for the soda, and $3.25 for the cigarettes and he paid $4.75 for a one week of interest. I accepted him paying me over 1,200% APR!

[TechBear_Seattle]

17. Anyone else long for the good old days when usury was a mortal sin? n/t

[linazelle]

18. Obviously they are in need of free publicity--bet people will flock

to their doors now. :eyes:

[BiggJawn]

20. like doubling the mileage on a 6MPG SUV.

12MPG is still crappy.

So Richard will take your second-born instead of your first-born now?
And I bet he's serious. These scumbags learned their trade back in the "GREED is GOOD!" 80's. they really believe in that Randian "If it was too expensive, we wouldn't have any customers" bullshit, just like Exxon and Citgo...

[oscar111]

21. they learned their trade in ancient Assyria, Parthia, medieval Italy

and England, .... math tricks to rob, go a long ways back.

Some still in use today.

my favorite ??... is mortage... payments do not reduce what you borrowed. They are imagined to apply only to the interest. Ho Ho Ho. huge trick, huge robbery.

somewhat bigger than "rent gets you no equity toward purchase of your apartment."

and the new "cell phone minutes expire"... and "that check is stale, you lose all"...readers.NOTE.. in many cases you can ask for and get a reissued check, and not lose anything... try it. Still, that is a needles hassle that a progressive nation would never let you be subjected to.

FDR, come back and save us.