Cash-Strapped NFL Players Seeking High-Risk "Lockout Loans"

[FLPanhandle]

http://www.thepostgame.com/features/201104/tpg-exclusive-cash-strapped-nfl-players-seeking-high-risk-lockout-loans#

As the NFL lockout enters its second month, players from at least 16 teams have already sought out extremely aggressive short-term loans with high interest rates, ThePostGame.com has learned.

According to a financing source, these interest rates range from 18 percent to 24 percent, and upon default, they can rise as high as 36 percent.

All of this comes as the NFL Players Association announced nearly two weeks ago it would begin payouts from its war chest -- a lockout fund designed to help keep players afloat during the work stoppage. But while that lifeline was created in part to keep opportunistic lenders at bay, the finances offered by the NFLPA -- as much as $60,000 for some players -- won’t solve all financial ills. And much to the chagrin of some members of the union, the high-risk loan market has begun to attract players.

"There are a lot of people out there pitching these things," an attorney who has advised players on such loans told ThePostGame.com on the condition of anonymity. "It’s almost predatory lending. It's people going to guys who they know are already in debt, or don’t have the ability to pay their bills during the year and at such obscene terms, that you say, 'Hey, no one would ever sign something like this.' But a lot of players are."

<snip>

Legal and financial sources with ties to players say many affiliated with the high-risk loan industry are soliciting individuals close to cash-strapped players. " are your gray-area guys who aren't agents, aren't managers, aren't financial advisors," the financial adviser said of the loan industry middlemen. "And getting fees of $100,000-$150,000 for getting players to sign off on the loans."



Two thoughts:

1) The union should help setup a line of credit for these guys beyond their $60,000 Union lifeline.
2) These guys must be living large with no savings if a $60,000 lifeline (more than the average US worker makes), is not enough.

[Obamanaut]

1. Another thought is that they might have used their college career to

prepare for an alternate career, something to do in case of injury in the professional arena making football impossible. The opportunity was there for most/many. Some didn't even have to pay for college at all, scholarships paid it all.

[Johonny]

4. You think their college coaches cared about that

they are lucky if they got to goto class. Most of these kids in college were told they all are going to make, your pay day is coming. Heck not even college, high school, JV. These people tend to have smoke blown up their * for years. Not everyone falls for it. Some get educate, some get good degrees. But more than one ex-player has written about how so many of them fall for the trap. You work your * off for a coach that gets paid million while you get paid in future expectations. In most programs there isn't the person out there telling you have to get that degree. They need you in the gym, in the workout program, in spring practice, in the involuntary practice, etc... The coach knows full well even the best programs may place only 8-12 player on the current squad into long term NFL careers, but they never tell you that. Let's not even get into the cars, money and women these colleges "pay" these guys to play football. These kids have been taught the wrong lesson, is it surprising many learned football is more important than class.

There's a lot of great college football writing out there and none of it paints a good picture of college athletics (particularly the football programs).

As for the NFL guys. Jeepers the Unions been telling its member for 2 full years this was coming, save your money, be ready. Really tells you how poorly these people have been trained their whole life for the business side of the NFL.

[Obamanaut]

7. None of what you said in the first few sentences was kept a secret from anyone.

It is similar to a person becoming a rock star, movie celebrity, etc., then complaining about a lack of privacy, no personal life. Inasmuch as rock stars and movie celebrities have been complaining about this for a very long time, it is not a secret.

I saw a movie made in the 1940s where cigarettes were referred to as 'cancer sticks.' It has never been a secret how difficult it is for a smoker to quit, or the other ill effects associated w/ smoking. Yet, despite this, people smoke, and more start every day.

In all three of these instances, it is 'let the buyer beware.' There have been no secrets, it is all published information, and even college football players have access to newspapers, magazines, movies, etc. that address the pitfalls of a professional football career. As college students they had access to class advisors, parents, and all manner of resources.

It is often a case of "It won't happen to me." But it does.

[Blue_Tires]

2. Anyone insane enough to take a loan at that rate deserves what he gets

Especially with so much emphasis in recent years on financial literacy among pro athletes...

I'm not trying to sound callous, but the players knew last summer (maybe earlier) that the labor war could be at an impasse after the Super Bowl...A little bit of foresight and rainy-day planning would have helped...

[FLPanhandle]

3. The union told them to save 3 game paychecks from last season

Maybe the Union needs to up their dues and warchest fees if their members are financially idiots.

[daa]

5. Keep in mind they should have thought ahead

their career could end on an injury or being cut.

[Bake]

6. They were busy buying a house for Mama or a Bentley

Because, you know, you got to keep up appearances.

Bake

[Mrs. Ted Nancy]

8. Most buy an annuity

for an injury type of situation. Unfortunately for them, they can't collect on it due to a strike.

[Safetykitten]

9. I am crying as I type this. What will we do as a society? The horror!

[Recovered Repug]

10. From what I understand, players haven't missed any checks yet.

I was under the impression that they were primarily during the season (some small amounts for OTAs and preseason). I wonder if this has been common for a long time and just getting attention because of the lockout.