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SarahBell

3043.8 % Apr A Record?

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Pretty sure I've seen one of those paycheck advance loan things that's 7 days long but 27,000% annualised

That is 74% daily. Thats means the following day you owe 2.5x what you borrowed with interest. There needs to be some regulation, the loans sharks have worked out that they can be legal with the lax laws we have now.

There should be a limit on interest.

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That is 74% daily. Thats means the following day you owe 2.5x what you borrowed with interest. There needs to be some regulation, the loans sharks have worked out that they can be legal with the lax laws we have now.

There should be a limit on interest.

It must be worked out compound as 74% daily just cannot be correct.

If it is around 11.36% weekly then that works out to be 27,000% annually (i.e. 1.1136^52).

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That is 74% daily. Thats means the following day you owe 2.5x what you borrowed with interest. There needs to be some regulation, the loans sharks have worked out that they can be legal with the lax laws we have now.

There should be a limit on interest.

You really shouldn't get a mortgage or any other loan until you understand compounding

Interest at time scale x=10^(log(interest at time scale y)/x)

and not

Interest at time scale x=(interest at time scale y)/x)

Edit coz although I can do arithmetic I cant type

Edited by zebbedee

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Sorry I was being lazy and didn't work out compounding.

A lot of people don't understand how this works as has been demonstrated by some of the calulcations given in this post.

People should be protected, anyone who thinks a percentage rates that this high is mad. Borrow £1 but at the end of the year you owe

£27000, you might as well volunteer to be mugged.

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Sorry I was being lazy and didn't work out compounding.

A lot of people don't understand how this works as has been demonstrated by some of the calulcations given in this post.

People should be protected, anyone who thinks a percentage rates that this high is mad. Borrow £1 but at the end of the year you owe

£27000, you might as well volunteer to be mugged.

I don't see where the problem is.

After a year you could borrow £27000 to pay off the debt :P

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Wonga have a forum full of happy customers...

https://www.wonga.com/forum/wonga-moments-f7.html

I have complained on this forum about the way I have been treated, but for some reason my note wasn't added to the discussion.

Having written to wonga without response I thought I'd try again via the forum. Why am I being ignored? Why did you not include my previous note? Is it because of the huge charge you took out of my account meaning that I have paid over £300 interest on a £400 loan, a total of £700 which I could not afford.

In the meantime I am sent junk mail telling me I am a valued customer, how can I be when you don't reply to my calls as promised (dated 30/11/10) or reply to many emails sent since that date?

Oops?

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Oddly enough some backwards nations have laws against this kind of thing. Anything above 70% APR is illegal in many places, but they are backwards and living in the stone age.

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just shows how meaningless the APR actually is.

If I lend my mum £100 today, and next week she pays me £110, god knows what the APR is.

but, in reality, shes paid me a tenner for transfering the money, the phone calls and peace of mind.

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just shows how meaningless the APR actually is.

If I lend my mum £100 today, and next week she pays me £110, god knows what the APR is.

but, in reality, shes paid me a tenner for transfering the money, the phone calls and peace of mind.

Some industry spokesman did make a similar point.

He said when you check into a hotel for a night they don't tell you the annual prices is £36,500 they tell you it is £100 a night.

Their loans aren't designed to be held for a year - they are short term loans for a fixed fee.

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I've actually used Wonga a while ago. :P

I'd bought something that month which meant a DD would've sent me overdrawn.

Santander charge £5 a day for the privilege.

I think I saved about £30. B)

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Bank charges are a whole other argument, how much would Santander have charged you if you arranged an overdraft with them ?

No idea but I dont want an overdraft. I had one a for a while and just seemed to be always in it.

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Wonga have a forum full of happy customers...

Don't have much sympathy for someone who takes out an exorbitant loan and then complains about how exorbitant it is.

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Let's not jump on MP's favourite bandwagon, high numbers with a percentage sign after them. As Bloo says, the shorter the term, the wackier the APR is.

Say the industry was regulated to provide finance at a maximum APR of 100%, a figure which would certainly still have many frothing at the mouth. A firm who lends out money for a term of a month would be expected to limit its charges to about 6% of the sum borrowed. Would any firm lend £100 in order to get £106 back? N.A.F.C.

Short term, low amount loans = huge APR, and you'd be bonkers to suggest they ought to be compared to longer-term loans. The figure to look at (with any loan) is TOTAL AMOUNT REPAYABLE.

It works in completely the opposite manner with mortgages, people get excited about the low rate, and conveniently forget that the total payable is close on double what they borrowed since the term is large. People are plain nuts.

Edited by cheeznbreed

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Short term, low amount loans = huge APR, and you'd be bonkers to suggest they ought to be compared to longer-term loans. The figure to look at (with any loan) is TOTAL AMOUNT REPAYABLE.

Short term loans would be better managed by credit unions. They are a bad thing for most people.

Finance classes for those who want loans before allowing them to borrow any money.

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Sorry I was being lazy and didn't work out compounding.

A lot of people don't understand how this works as has been demonstrated by some of the calulcations given in this post.

People should be protected, anyone who thinks a percentage rates that this high is mad. Borrow £1 but at the end of the year you owe

£27000, you might as well volunteer to be mugged.

£271

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£271

Good spot, I should really re-read what I have typed before hitting submit button.

Doesn't change my view though that interest rates should be limited. What risk is their for these companies of someone not paying up, if they don't they obviously don't have enough money to go bankrupt and an attachment to their earnings would shortly follow.

The problem with this the interest rates in question, plus charges for late payment, plus court fees, what may have started out as a very small loan is now a considerable sum with a very large interest rate. At this point the customer has no chance of clearing the amount and what was designed as a short term interest rate will now become long term.

If interest rates of the levels being discussed are allowed to continue then the problem above needs to be addressed.

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Pretty sure I've seen one of those paycheck advance loan things that's 7 days long but 27,000% annualised

They are typically 25%-30% per week which is a lot more than 27,000% APR. Try 10,947,544% - 84,149,939% APR.

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  • 312 Brexit, House prices and Summer 2020

    1. 1. Including the effects Brexit, where do you think average UK house prices will be relative to now in June 2020?


      • down 5% +
      • down 2.5%
      • Even
      • up 2.5%
      • up 5%



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