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tony draper
27th Oct 2004, 07:08
Item on the news this morning a couple are in court charging a loan company with extortion I think it said, they took out a 5000 pound loan for home improvements, they fell into arrears and after three years they now owe the company 300,000 pounds.
These loan companies are kidding aren't they? I thought Usuary(sp) was made illegal in Victorian times, thats the kind of interest and default payments rate that Tony Soprano and his ilk would charge.
Extortion is the right word I think.

Parapunter
27th Oct 2004, 07:16
Tis drapes. They were charged at something like 34% interest & then fell on hard times. This is outrageous practice. Sadly one thinks the sharks involved prolly don't care about the publicity from this judging by the business methods they use.

While we're on, beware the revenue. A Mr & Mrs Jones of West Sussex lost a case against the inland revenue yesterday, which will have big implications for Husband & wife businesses. Up until now, couples could take seperate divvy out of companies to minimise the tax burden, however, using obscure tax laws from the 1930's, the revenue have won an argument that it should all be treated as the major shareholders income, thus upping the tax take. Sneaky b*****ds.

However, the revenue dropped a claim in this case to backdate it 6 yrs & only claimed from the start of the action, so expect an appeal.

tony draper
27th Oct 2004, 12:29
Remember reading a library book many years ago about the history of money lending in England and the laws eventually brought in to deal with people charging excssive and downright criminal interest rates? ,money lenders were sent to jail,what the hell has happened,or is this another case of the gov giving letters of marque to business to rip of the citizen,and why not, our courts act as the official metaphoic leg breakers for these usurers(sp?) issuing court orders and such at their beck and call.

:suspect:

teeteringhead
27th Oct 2004, 15:10
Not defending the loan sharks or anything, but the way I heard it is they got the loan and then made no payments for 3 years! Now who's "having a laugh"?

Hardly counts as "falling on hard times" if you never made a payment??

Apologies to the borrowers if I got the story wrong ... the real crime is surely that if they'd have made all the payments on time they'd still have paid 20K+ ....... for a 6K loan ... that's what's outrageous.

tony draper
27th Oct 2004, 15:21
They used to hang people for charging interest rates like that in Victorian times.
Tiz difficult to feel much sympathy for these idiots that run up 20/30 k depts on their credit cards, but the companies themselves must bare some responsibility for allowing them to run up bills like that in the first place.

Nigerian Expat Outlaw
27th Oct 2004, 15:28
Six of one, half a dozen of the other. Stupid people being taken advantage of by unscrupulous finance companies.

M.Mouse
27th Oct 2004, 15:33
According to the article I read the couple in question were, allegedly, a bad risk. For this reason the interest rate was higher than average.

It has always struck me as bizarre that bad risks have to pay more interest, therefore increasing the likliehood of default!

What is wrong with refusing a loan to people known to be a bad risk?

Parapunter
27th Oct 2004, 15:50
I suspect a bit of looking down noses here. If you live on a sink estate, have no job, aren't all that bright, have few prospects, then maybe you shouldn't take out a big loan.

However, you probably want to participate in the nice things in life. After all, there is relentless pressure everywhere we turn. Xboxes, Minis, Nice furniture, Holiday abroad? kids want the lastest trainers. 50% off in the Currys sale. It never ends. The bank won't touch you, neither will the credit cards. No problem, step in the local loan shark. He'll even call round each week to save you the bother of going to the post office to pay.

Then you realise you've been had. But too late, the 1000 you borrowed is now 2,500 & it's growing quicker than you can pay it. Before you know it, it's christmas & he's offering you a bit more, you know, for the kids.

These operations are out there & thet seek the weak & vulnerable, who after all, aren't that bright...

Binoculars
27th Oct 2004, 16:00
The Scene; Honest Binos' Loan Agency.

The time; First day of business.

B: Kylie!

K: You don't have to yell, sir, I'm in your lap.

B: Kylie, in this business, the customer is always right. OOOhhhhhh. Do you understand?

K: mmmgrrslnkphhgrrkllmm holy shit!

B: Excellent. Here is our first customer; wipe your mouth and treat him as though he's a human being.

K: swllmp, ahem. Whew, Yes, sir.

Customer: err yeah, like I needa lotta money.

K: Certainly sir, we are at your service, how can we help you?

C: What's that around your mouth?

K: I had an apple turnover for morning tea, are you a detective or what?

C: Duh. Money?

K: Certainly. Our usual terms apply, 10% per day, mother's body as collateral if available, blah blah blah...

C: (looking nervously at door): yeah yeah, whatever. Can you just give me $20k now?

K: Sir, I must by law read these terms to you. It will only take about 90 minutes. Alternatively, you can sign this waiver, err yes, right there, thank you, which tells you...

C: where's the pharking $20K? They'll be here any minute.....

K: Well, sir, I do happen to have 20K in cash in this envelope, but the law stipulates that if I give it to you, this form 3A/24/B/C2 must be ... ohh, thank you sir, you are most kind...err, goodbye!

K: Boss, you'll never guess what just happened!

B: Did he sign the 3A/24/B/C2 stipulating 100% per diem interest unless he doesn't answer his phone within 5 seconds in which case it reverts to 200% per diem??

K: Yes indeed sir, and I didn't even have to......

B:..and you got his passport photocopied?

K: Oh yes, sir, and I didn't even have to....

B: You've done beautifully, Kylie. here's a hundred on the side. This is going to be a beautiful business. I think I'm ready for some more relaxation therapy, if you wouldn't mind. And Kylie, would you mind wiping your lips?

tony draper
27th Oct 2004, 17:43
Trouble is its not just fly by night finance companies, its also the major High Street Banks, and Mr Parahunter 1000 to 2500 is extreme but understandable, 5000 to 300,000 in three years is criminal, company directors can apparently put themselves into recievership if they run into hard times and directors walk away owing their employees and creditors hundreds of thousands, if not millions, but the individual is not allowed to do this?.
As I said I don't have a lot of sympathy for some of these fools, but then I am fortunate, I don't owe anybody a meg and my house was bought and payed for moons ago, something should be done about companies charging interest rates like that, as I also said, the back street loan sharks wouldn't have the nerve to charge rates like that.

Parapunter
27th Oct 2004, 21:07
I'm not agin you on this one Mr D. But you clearly do have the brains you were born with.....most of the time:E :E

I think when it all looks a bit hopeless, some types will grab what is apparently a passing liferaft, not realising it's already sinking. Only some types, but enough to keep these buggers in work. I'd be willing to bet you'd find 'em up Benwell & Walker for example on any day you looked:(

tony draper
27th Oct 2004, 21:15
As I understand it back street loan sharks are targeted by the law,and rightly so, how come the banks and finance companies get away with charging criminal rates of interest?,charging exsessive interest was a criminal offence at one time, has the law changed recently?
:confused:

Parapunter
27th Oct 2004, 21:32
One of the credit cards - (whose easily recced name one has edited out should blueflapsigan be ired) was the beneficiary of several hugely succesful marketing campaigns wot spooofed james Bond. It put on millions of subscribers & charges in excess of 18% monthly interest. Interest rates are 4.5% of course at present.

That is legalised muggery imho:(

Bo Nalls
28th Oct 2004, 20:06
Just heard that the Judge has written off all of the debt!! Seems he thinks the original loan terms were extortionate

Implicatrions for other Loan Companies/Sharks??

MadsDad
29th Oct 2004, 07:10
Also on the news this morning was someone who took out a loan with the same company, for about 8,500, in 1991.

He claims he has never been in arrears and has so far paid back over 28,000. Recently he asked how much it would cost to pay the loan off and was quoted in excess of 90,000!!!!!

Someone, somewhere, is extracting the juice here.

Navajo8686
29th Oct 2004, 07:38
There was much joy and happiness a few years ago when the banks and finance houses were forced to quote an APR rate on all of their documents covering loans.

IMHO it was joy and happiness for the politicians making the rules & not for the 'man on the Clapham Omnibus'.

It has long been one of my pet hates that banks (and co.) do not quote the true cost of borrowing the money. When many years ago I had a few financial problems it only then dawned on me how much a mortgage was really costing - not much help knowing that the APR was, for example, 14% when in real terms over the term of the mortgage I was paying back around (say) 300%. Can't remember exact figures (and neither do I know what I'm into the bank for now either!) sorry.

Quoting the real interest rate would be so much clearer on loans - if they are not fixed term then an example could (and should) be given.

Still there's not much incentive for the banks etc to show just how greedy they are - after all they makes petrol companies look unprofitable!

Navajo8686