3 ms·

Those are great points, they're just further up the chain than where we are when we're trying to execute our day to day. It was an option on the table he didn't

Those are great points, they're just further up the chain than where we are when we're trying to execute our day to day. It was an option on the table he didn't have to take. He's a grown man, and he made a call. It may have even been the right one. I come from a "payday-loan poor" family, and spent a good chunk of my adult life there myself. It's hard, but people with comfy salaries paternalistically taking options away because they know better really agitates me.

moonka 8y ago
>It may have even been the right one. Absolutely, I just think it's a shame that there aren't alternatives available. Normally I'd assume that interest rates are that high because that's what is required to remain profitable while lending to the market, but I can't help wonder if consolidation and wall street ownership means there's a large profit margin and some gouging happening.
- menacingly 8y ago
  Well, then we're on the same page. I don't want him to need the loan, but I respect him enough to trust him with the option. I'd prefer a competitive marketplace for his loans to shaming the concept of an alternative financial system, and I absolutely would not put it past capital to collude to keep the interest rates high. I don't know that, though, since these are risky loans. Case in point, this very dude didn't pay it back.
- tehlike 8y ago
  The interest rate is high also because default rate is high, there is no financial background/credit history check most cases, and this is what makes them profitable pretty much.
mfringel 8y ago
That's a fair point. The next question is "What do better options look like, and how do we get there?" High interest-rate loans are one thing. Forcing payment for the company's lawyer is another. Broad-spectrum mailing of loan offers with (what looks like) no assessment of ability to pay is quite another still.[1] --- [1] Or even worse, selecting for people who they know can't pay immediately, so they can rack up the margins/fees. That would be one of the typical definitions of "predatory."
- Kalium 8y ago
  It's worth remembering that people who can't pay immediately are almost by definition those most in need of credit. If you protect them by taking away their access to credit, the likely consequence is either them seeking out illegal credit or failing to gain credit at all. There aren't obvious better options, once you strip the business down to its core of high-risk credit. It's a business that no matter how efficient is going to come with high interest rates. The obviously predatory marketing practices need to be stopped. But the core of the business here is never going to be a nice one. :/
s73v3r_ 8y ago
I think the biggest obstacle is people simply not having personal finance education. This is something that very clearly should be taught in high schools, and yet, whenever it's brought up, seems to face some pretty hard resistance.

moonka 8y ago

>It may have even been the right one. Absolutely, I just think it's a shame that there aren't alternatives available. Normally I'd assume that interest rates are that high because that's what is required to remain profitable while lending to the market, but I can't help wonder if consolidation and wall street ownership means there's a large profit margin and some gouging happening.

menacingly 8y ago
Well, then we're on the same page. I don't want him to need the loan, but I respect him enough to trust him with the option. I'd prefer a competitive marketplace for his loans to shaming the concept of an alternative financial system, and I absolutely would not put it past capital to collude to keep the interest rates high. I don't know that, though, since these are risky loans. Case in point, this very dude didn't pay it back.
tehlike 8y ago
The interest rate is high also because default rate is high, there is no financial background/credit history check most cases, and this is what makes them profitable pretty much.

mfringel 8y ago

That's a fair point. The next question is "What do better options look like, and how do we get there?" High interest-rate loans are one thing. Forcing payment for the company's lawyer is another. Broad-spectrum mailing of loan offers with (what looks like) no assessment of ability to pay is quite another still.[1] --- [1] Or even worse, selecting for people who they know can't pay immediately, so they can rack up the margins/fees. That would be one of the typical definitions of "predatory."

Kalium 8y ago
It's worth remembering that people who can't pay immediately are almost by definition those most in need of credit. If you protect them by taking away their access to credit, the likely consequence is either them seeking out illegal credit or failing to gain credit at all. There aren't obvious better options, once you strip the business down to its core of high-risk credit. It's a business that no matter how efficient is going to come with high interest rates. The obviously predatory marketing practices need to be stopped. But the core of the business here is never going to be a nice one. :/

s73v3r_ 8y ago

I think the biggest obstacle is people simply not having personal finance education. This is something that very clearly should be taught in high schools, and yet, whenever it's brought up, seems to face some pretty hard resistance.