Online installment loans have taken the subprime market by storm • Hacker News Board

Re: Online installment loans have taken the subprime market by storm

#311

Post by novok » Wed, Oct 30, 2019, 4:21 PM UTC

toast0 wrote: post #299

novok wrote: post #256

Earlier quoted context omitted.

That you pay for via inflated prices and fat profit margins.

When the offer is $X now or $X/36 for 36 months, it's clear the seller is paying the financier, but that doesn't mean the seller will offer a discount for current payment.

Some do although, especially when you poke them about it. You see it often with cars where you offer all cash vs the %0 financing option, you can often get a discount that way. The $2000 in interest you were going to pay implicitly through the inflated price of the car goes away.

Re: Online installment loans have taken the subprime market by storm

#312

Post by C1sc0cat » Wed, Oct 30, 2019, 4:47 PM UTC

wefarrell wrote: post #241

driverdan wrote: post #229

Earlier quoted context omitted.

I downvoted you because this is not true. 0% offers end with the interest rate spiking. Mortgages have extremely low rates right now. All you'd have to do is carry that 0% offer past its expiration for a short time to make up the cost difference.

It's absolutely less risky for a number of reasons: 1. If I default on my credit card debt it will screw up my credit but the banks can't come after any of my assets. If you default on a mortgage it will screw up your credit and the bank will take your home. 2. I am free to take on the level of risk that I'm comfortable with, including risk free options such as treasuries or CDs. With a mortgage you are locked in. 3.…

Your buying stocks/security on credit ! wow I have well over $100k in stocks etc and I have no leverage on that

Note (some of the investment trusts stock in own do )

Re: Online installment loans have taken the subprime market by storm

#313

Post by Cd00d » Wed, Oct 30, 2019, 5:52 PM UTC

gruez wrote: post #179

Cd00d wrote: post #126

Earlier quoted context omitted.

In the datasets I use at work, I'm seeing these or similar credit not for emergency solutions, but rather for luxury consumption (the very poor aren't likely to be in our panels). People are buying Peloton bikes, exotic vacations, and luxury purses, and hoping to pay that debt off in installment plans. I worry about when enough people hit the tipping point where their monthly minimums on deeply depreciated goods are…

What dataset has this information? I haven't personally gotten a payday loan, but I don't think they ask what the money is going to be used for.

We see the lender, not explicitly what was purchased. But, when you visit the lender's website you can see the pitch.

See the pitch for the already mentioned Affirm: https://www.affirm.com/

Re: Online installment loans have taken the subprime market by storm

#314

Post by jcater » Wed, Oct 30, 2019, 6:07 PM UTC

novok wrote: post #256

jcater wrote: post #218

Earlier quoted context omitted.

They do, as I bought a Peloton using Affirm. I was ready to pay cash, but they offered to do an interest free, no fee loan thru Affirm and split it across a couple of years. So I did it, because why not? I’m guessing this was probably an arrangement between Peloton and Affirm to where the former paid some fee to the latter, and all of that is absorbed as marketing overhead just to get more people buying bikes.

That you pay for via inflated prices and fat profit margins.

Sure, but as there were no full payment discounts, full cash buyers subsidized my payment plan.

Re: Online installment loans have taken the subprime market by storm

#315

Post by lcall » Wed, Oct 30, 2019, 6:22 PM UTC

sharkmerry wrote: post #310

lcall wrote: post #294

Earlier quoted context omitted.

I am not selling anything (maybe some software someday, but that's a different topic). But I think about things like this a lot and have posted many thoughts, over time. I hope you don't mind but this is my best work in this area, so far, over some years. (Truly, we do not need to be alone, or give up. I have been thru many things that ... leave me grateful now. So I hope this can be useful to someone....) There are…

Is this SEO spam? Every comment seems to have numerous links in it

No (but I can see why you ask). It is my simple attempt to share info that helps people. I have put a lot of work into it, and each part seemed relevant to the discussion (which is what motivated me). It is easier than posting the notes every time. Again, there is nothing for sale there. If you look at the material and have suggestions for how best to answer questions without pasting long paragraphs I have already put elsewhere, or other suggestions, I appreciate that.

Re: Online installment loans have taken the subprime market by storm

#316

Post by lcall » Wed, Oct 30, 2019, 6:24 PM UTC

sharkmerry wrote: post #310

lcall wrote: post #294

Earlier quoted context omitted.

I am not selling anything (maybe some software someday, but that's a different topic). But I think about things like this a lot and have posted many thoughts, over time. I hope you don't mind but this is my best work in this area, so far, over some years. (Truly, we do not need to be alone, or give up. I have been thru many things that ... leave me grateful now. So I hope this can be useful to someone....) There are…

Is this SEO spam? Every comment seems to have numerous links in it

Maybe an alternative could have been to make one page with all those on it, so just one link (but I was getting tired). :) Edit: Another way to see it is: I have a lot to say, but rather than put it all here, I link to it, when it seems relevant and like it could be helpful.

Re: Online installment loans have taken the subprime market by storm

#317

Post by wefarrell » Wed, Oct 30, 2019, 6:59 PM UTC

MuffinFlavored wrote: post #250

wefarrell wrote: post #148

Earlier quoted context omitted.

The card is still under your name, the application will pull your credit report, and you're personally liable for the debt. However most major banks (with some exceptions) do not report business cards to the credit bureaus unless you're in default, so it's possible to carry large balances without any impact to your credit.

When is the statement balance due? Every 30 days? I don't see how this is 0% APR/any different than a consumer credit card?

The statement balance is never due but I always make sure to pay it off before the 0% APR ends. Each month a small minimum balance (around 1%) is due.

Re: Online installment loans have taken the subprime market by storm

#318

Post by geggam » Wed, Oct 30, 2019, 7:36 PM UTC

dang wrote: post #304

geggam wrote: post #4

Why should society be bailing out the banks who loan money to folks who cannot afford it then turn around and bail out people who borrow money and cannot afford it ? If you are broke file bankruptcy and reset your life. Quit trying to steal tax dollars

Please don't start flamewars on HN, and please don't perpetuate them. We've had to ask you this before, and even warned you that we'd ban you if you kept doing it. https://news.ycombinator.com/newsguidelines.html See also https://news.ycombinator.com/item?id=21394294

How do I delete this account ? Or can you do that ?

Re: Online installment loans have taken the subprime market by storm

#319

Post by dfcagency » Wed, Oct 30, 2019, 9:05 PM UTC

twh270 wrote: post #138

dfcagency wrote: post #120

Earlier quoted context omitted.

This is victim blaming. Do a little back of the napkin budget on $4,200/month (GENEROUS) take-home pay in say, Fremont, California. You run out of money real, real quick.

So, don't live in Fremont if you can't afford to live there. Or find a roommate(s), live with family.

This is a shitty, "got mine, fuck you" mentality that I really hope you re-examine.

Re: Online installment loans have taken the subprime market by storm

#320

Post by dfcagency » Wed, Oct 30, 2019, 9:06 PM UTC

pkaye wrote: post #160

dfcagency wrote: post #120

Earlier quoted context omitted.

This is victim blaming. Do a little back of the napkin budget on $4,200/month (GENEROUS) take-home pay in say, Fremont, California. You run out of money real, real quick.

I live in Fremont, CA. I think if you live in a nice 1-br apartment, it might take half your budget. But if you take a bigger place and roommates, it should be doable.

First off, I'm sorry you live in Fremont. It's a cultural hellscape.

Secondly, you're right - it should actually take more than half of your take home pay.