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Debt-lover's dream: Loans available at 141.42% APR

Posted Jan 25 2008, 03:38 PM by Karen Datko
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Before his happy experience with CashCall, "Chris B." wrote at CashCall's "testimonials" page, "I have never dealt with a company who was willing to give the little guy a chance without feeling like I was selling my first born." Well, maybe not your firstborn this time, but how about the roof over your firstborn's head? CashCall's Web site advertises loans with interest ranging from 24.58% APR to an astronomical 141.42%.

At CashCall, you can conveniently look up the interest rates available in your state. The highest in California, a 99.25% APR, applies to a $2,600 loan with a payment schedule of 42 payments of $216.55. So, after you subtract the $75 loan fee, you're paying $9,095.10 to borrow $2,525.

In all fairness, we must mention that the site also lists a $2,600 loan at 26.88%, and, according to the Web site, there is no penalty for prepayment.

The 141.42% APR is available in numerous states for a $1,500 loan, or $1,000 after you pay a $500 loan fee. The schedule is 12 payments of $159.83, or $1,917.96 total.

Unfortunately, people who have trouble getting more conventional loans could do worse, according to CashCall Watch, a blog that tracks the company and the payday loan industry. "Payday loan providers don't even disclose their APR rate; you have to do the math to figure out a $20 fee for a two-week loan on $100 has an interest rate of over 500%," CashCall Watch wrote.

CashCall states that its lowest rates are available to clients with "excellent credit." We can see from the "testimonials" -- assuming these were written by real customers -- that some of its clients have less-than-perfect credit. "Ascension N." wrote, "I was living paycheck to paycheck and I needed a loan, but I kept getting denied. Even my own bank turned me down!" K. Thomas said: "I see the commercials on the television daily, and always thought you had to have good credit to get loans that are in the thousands. Well I am living proof that you don't need good credit."

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Comments

 

These are Mafia rates. It should be illegal. But then, Capital One does this also. Capital hill is scambling to fix the economy? This is the real cause and effect - banks ripping the most they can from consumers with no recourse.

HvVy (Posted 01.26.08 1:34 AM ) Report Abuse

I think that we need to keep these businesses in check. This is robbery. At the same time people are willingly signing up for these loans. No one is forcing them. The borrower is slave to the lender! Stopping spending more than you make. A great documentary about this very topic is Maxed Out. Most big banks such as Wells Fargo and CitiBank own these check cashing places.

Livinglikenoother (Posted 01.26.08 5:52 AM ) Report Abuse

I agree that this is highway robbery and the Feds should stop this kind of lending.  However, I also think that the people who use this type of service already messes up their credit by not paying back funds from prior loans or credit cards.  If you can't afford to pay your bills work two jobs.  If you can't afford to feed your kids, don't keep having more!  If you can't afford to rent a $2000 a month appartment to live in sunny Fl or Ca then move to the midwest and rent a house for $500 a month.  

People want someone to bail them out everytime they can't make ends meet.  Stop spending money on video games and pricey cars and do what our mothers and fathers did, work as many hours as you need untill you figure out how to be fiscally responsible.  You can't spend money if you are working all the time.  And, read the fine print before you sign up for an ARM or cash advance.  McDonalds is always hiring if you need a second job.  I worked there for many years and it's not as bad as you think and they actually don't pay that bad.

TAW (Posted 01.26.08 6:48 AM ) Report Abuse

Just LOOKING at these avertised rates makes my kneecaps ache!! Where's Elliot Ness when you need him???

S. Frenchy (Posted 01.26.08 8:38 AM ) Report Abuse

credit card companies are like drug dealers.  they lure you in with a $500 limit then double it until you can a debt of $20,000 and more.  they have no idea if you can pay it back, they don't check to see if you have a job, have a fixed income or if you're even alive, they assume.  well aren't they the big fat ass.  no wonder the economy is in such a mess.  people spend what they don't have.  people are unrealistic to think that they'll make more money and will be able to pay the debt.  if you don't have the money in your hand, you don't have it.  then the credit card companies increase your apr to 26% and 32% if you miss a payment.  what a vicious cycle.  why not outlaw credit card companies?  something has to change.  we're drowning in debt.  

Marcia (Posted 01.26.08 9:55 AM ) Report Abuse

AscensionN must be a fake, and if truly "living paycheck to paycheck" then wouldn't have any other money, so wouldn't have a "my bank" who could turn them down. I should think virtually ALL great testamonials at these places are fake, because people in such dire straits as to need to  go to them for money wouldn't have a computer and certainly wouldn't praise a place who robbed them of such high overcharges.

wendy bartlett (Posted 01.26.08 10:10 AM ) Report Abuse

Reverse the Law and make intrest on credit cards and loans a Tax deduction

once more. And Watch the Feds step in and Control these rates.

jkl (Posted 01.26.08 10:18 AM ) Report Abuse

EVERYBODY is lookin to screw ya! They got you comin and goin and goin and comin and always too soon! We all havta stop it sooner than later cuz it's not gonna get any better until WE THE PEOPLE put our feet down and say ENOUGH IS ENOUGH!

bOB (Posted 01.26.08 1:15 PM ) Report Abuse

Wow! 141.42% ?? This is legal? How the government let this people do this?

Tony (Posted 01.26.08 1:18 PM ) Report Abuse

Not all people who end up in dire financial straights are there because they intentionally placed themselves there by living beyond their means, some people have catastrophic illnesses, or as what happened to us, a catastrophic accident that place my husband in a wheelchair and me as his full time caregiver, even though we thought we had done everything possible to protect ourselves in case of such things with insurance and savings.  Life happens at a fast pace, we found ourselves floundering just to hold onto our modest home, we had gone from making $70 k or more to barely surviving on workman's comp checks.  I am not complaining, just tired of reading posts that suggest that all people in financial struggles deserve to be there because of their ineptitude to handle finances,  simply not true and not fair!

hibby (Posted 01.26.08 1:31 PM ) Report Abuse

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