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So why is it so important to charge somebody well above the 10% interest rates over a scoring system that is broken. I mean come on, your going to give somebody %2 interest rate and cheap monthly payment vs somebody who has no credit or working on it a higher rate. When in fact most people bale on their monthly payments due to the rates that was given to them. Allowing somebody to make a $200 car payment with 2% vs $500 and %20.. who do think will default first? Would be easier if you just let them do the 200 a month to be fair with rest of the well off buyers. If that person is late, than charge a late fee as normal, but dont go jacking up their monthly payments and interest rate beyond their ability to afford.
Well, if it is not important, then it should be no problem to maintain credit that would provide a lower interest rate for you.
You are wrong. If our Fed wanted to protect Americans from DEBT then it would begin raising interest rates back in 2001 and keep raising them until now. We should have interest rates close to 20% now and not next to 0. Instead of allowing Americans to SAVE money relatively risk free and having higher interest rates the Fed lowered rates to 0 and seduced even more Americans into debt. Instead of taking mortgage for $180,000 buying an average house the Fed in order to save Wall Street Banks lowered rates to zero and now Americans need to pay $350,00 for average house, have to take double amount of debt than they would if rates were higher.
Don't you people get it that eveyrthing since 2001 has been a SCAM. Our economy is DEAD and we can't have another real economic growth unless we go thru HELL first, unless we destroy all this bad debt that our Fed has been protecting.
16 years of madness and insanity!!!!!!
I think this view is distorted.
No one is seduced into more debt and I doubt most on this board have significantly increased their debt loads because of low borrowing costs. Poor financial decision making is going to be similar regardless of the Interest rates
The Fed's Interest rate moves were self serving - (a) stimulate economic growth after the housing crisis and (b) lower their own (massive) borrowing costs. This approach has dangers and is difficult to manage once set in motion (as we see now). Interest rates at 20% would sniffle the economy and probably contribute to unemployment so not sure why you think that is advisable (remember the 80s and Reganomics?)
Are assets overpriced ? Probably. Will there be a correction or meltdown or depression ? Who the heck knows really. All I know for sure is if you not on the merry-go-round you are not benefiting from the ride.
Again, everything since 2001 has been a SCAM. Lowering interest rates to zero is a SCAM, it's CRIMINAL to keep rates at zero, close to zero for 9 years and not allow our citizens to SAVE money. It's criminal to lure Americans into more and more debt by lowering interest rates.
Let me remind you all that proper role of Government is to regulate (provide laws and police powers to enforce these laws) Big Business, Big To Fail Banks. Where there are no laws -DEREGULATION - there will be only criminals, at least until we all pass into the Spiritual Kingdom in which selfishness and greed are no longer human problems.
Since 2001 we are experiencing massive SCAM and THEFT of public money that has never happened before on planet earth. Our economy has been dead since 2001 and everything since then has been about protecting the status quo and spending our kids and grandkids future earnings. Since it was imposible to grow our economy organicaly, the Fed together with our corrupt politicians decided to fake or simulate economic growth with debt spending. How mentally sick and insane do you have to be in order to do all this since 2001???????
As I mentioned above, Wall Street Big Banks are receiving money from the Fed for free and lending this money to Average Americans with interest, 10% and above. Think about this for a moment, you deposit your money into a savings account and you don't receive almost any interest, but when you borrow money from the bank most of you need to pay 10% interest or more.
We need laws and police to protect decent people from the sharks who believe the world should and must be a world of shark-eat-shark only. American Bank reform should use the American public power utilities as a model for what banking should become in the future .Bankers should be technicians and functionaries who serve the public and provide guaranteed stability, not entrepreneurs, not gamblers, who can always count on public bail-outs if their gambles turn to dust. Let the capital gamblers and entrepreneurs work in non-financial industries, such as technology and weapons-production.
My fellow Americans we all need to wake up and work together to end this Bank tyranny and this System of Debt Slavery!!!!
Again, everything since 2001 has been a SCAM. Lowering interest rates to zero is a SCAM, it's CRIMINAL to keep rates at zero, close to zero for 9 years and not allow our citizens to SAVE money. It's criminal to lure Americans into more and more debt by lowering interest rates.
Let me remind you all that proper role of Government is to regulate (provide laws and police powers to enforce these laws) Big Business, Big To Fail Banks. Where there are no laws -DEREGULATION - there will be only criminals, at least until we all pass into the Spiritual Kingdom in which selfishness and greed are no longer human problems.
Since 2001 we are experiencing massive SCAM and THEFT of public money that has never happened before on planet earth. Our economy has been dead since 2001 and everything since then has been about protecting the status quo and spending our kids and grandkids future earnings. Since it was imposible to grow our economy organicaly, the Fed together with our corrupt politicians decided to fake or simulate economic growth with debt spending. How mentally sick and insane do you have to be in order to do all this since 2001???????
As I mentioned above, Wall Street Big Banks are receiving money from the Fed for free and lending this money to Average Americans with interest, 10% and above. Think about this for a moment, you deposit your money into a savings account and you don't receive almost any interest, but when you borrow money from the bank most of you need to pay 10% interest or more.
We need laws and police to protect decent people from the sharks who believe the world should and must be a world of shark-eat-shark only. American Bank reform should use the American public power utilities as a model for what banking should become in the future .Bankers should be technicians and functionaries who serve the public and provide guaranteed stability, not entrepreneurs, not gamblers, who can always count on public bail-outs if their gambles turn to dust. Let the capital gamblers and entrepreneurs work in non-financial industries, such as technology and weapons-production.
My fellow Americans we all need to wake up and work together to end this Bank tyranny and this System of Debt Slavery!!!!
Slavery isn't a choice, choosing to borrow money is.
Payday lenders are too lazy to bother with actually sorting out risks over a gradient.
They don't care if a borrower's risk is 50% or 100% APR - all disks above 36% get tossed into their 400% APR pool. Lazy lazy lazy. Laziness shouldn't be rewarded. Worse, timely repayment makes no difference to payday lenders; borrowers who repay them timely continue to get 400% APR. Imagine if banks treated their customers like that.
It's not that they're lazy, it's just too expensive to make separate underwriting decisions on $100 loans.
Nobody's forcing these people to borrow, if they don't like the rates, they should manage their finances in a manner to avoid needing to borrow or go to a bank if they think they can get better rates.
Slavery isn't a choice, choosing to borrow money is.
What do you have when you have economic growth without wage inflation but with debt growth?
We got rid of wage inflation by shipping all our high-paying jobs to the Third World. Wall Street did this for us. By destroying America's unions Wall Street together with our corrupt politicians also destroyed wage growth in America, making debt slavery the only option for most middle class and lower working class Americans.
Fed policies of low interest rates is an encouragement to re-leverage, to take on more debt - not to de-leverage. More fees for banks; and if the government is protecting the banks from failure, then why not more borrowing, even from over-leveraged borrowers. It's a good system for Americans who should not be qualified to borrow money: if they fail to fulfill the terms of the loan, the bank doesn't take the loss, American tax-payers do. Wow! Who thought this up? This is a perfect method to teach theft, irresponsibility, and deceit.
This latest wealth gap is the most it has been in America since the 1920's, which, of course, ended with the Great Depression and the World War. All of these effects are related to the Debt Bubbles low rates create and the destruction of debt required after long periods of flooding the world with cheap money.
It appears the OP is unfamiliar with acturarial tables.
It's all about risk. People with lower credit scores are statistically a higher risk. It has to do with the borrower being unreliable.
Would you personally lend money to me? I'm super responsible. I promise. ;-)
No, no, give ME your money! I have a higher credit score, so you can trust me!
Payday lenders are too lazy to bother with actually sorting out risks over a gradient.
They don't care if a borrower's risk is 50% or 100% APR - all disks above 36% get tossed into their 400% APR pool. Lazy lazy lazy. Laziness shouldn't be rewarded. Worse, timely repayment makes no difference to payday lenders; borrowers who repay them timely continue to get 400% APR. Imagine if banks treated their customers like that.
i agree with pay day lenders too . they get stuck so much they have to charge everyone a ridiculous rate to just keep the lights on.
they should make 400-500% for what they do with all the losses they hit . that is the mark up in many industries . usually manufacturing and restaurants work on 5x cost .
industry wide 1/3 of all payday loans default in 8 months . 46% within 2 years . those are mind blowing losses
unlike banks they buy a dollar they don't rent it ..
just like losses in any business those who are the better customers have to pay for the bad ones
Last edited by mathjak107; 08-20-2017 at 01:14 PM..
Isn't that like saying Walmart doesn't force their workers to sign up for food stamps?
I didn't know Walmart instituted a policy where their workers were unable to be promoted or use their skill set at another company.
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