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Online installment loans have taken the subprime market by storm

bloomberg.com

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

#221

Post by qes »

downrightmike wrote: post #117
gruez wrote: post #89

Earlier quoted context omitted.

Just because it's cheap doesn't mean there aren't cheaper alternatives. Most people could easily replace that with a netflix subscription for $13, since they already have an internet connection.

Yeah, but then the cable companies will charge you anything over 1TB. And if you have more than 2 screens, because of kids, it will add up, so the cable company will relax that cap IF you also buy cable TV. Remember cable companies are assholes.

> if you have more than 2 screens, because of kids, it will add up

I download and seed hundreds of GB's a month of torrents and run a couple cryptocurrency nodes in a household of 4 where everyone uses youtube, netflix, and spotify often and we've broken 1TB once in a decade..

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

#222

Post by greenshackle2 »

ac29 wrote: post #112
arkw wrote: post #49

I interviewed recently at Fig Loans - they are working to dismantle the predatory payday loan industry. Only in a few states at the moment, but doing great things IMO

This is exactly the sort of company the article is about - the APR on their homepage is 190%. Maybe that's better than payday loans, but its still predatory and unscrupulous.

I'm torn on this, I don't know what the break-even rate is on such a loan, but it must be quite high, because the default risk is high.

Let's say 150% APR is exactly the break-even rate for this kind of loans to high-risk borrowers, would you say a company writing 150% APR loans is predatory?

Obviously it is an atrocious interest rate. But what is the alternative? Unless the government or non-profits step in the make loans at a loss (or hey, direct cash transfers) to the poor, the alternative is no access to credit at all, which is strictly worse.

This smells of The Copenhagen Interpretation of Ethics to me:

"The Copenhagen Interpretation of Ethics says that when you observe or interact with a problem in any way, you can be blamed for it. At the very least, you are to blame for not doing more. Even if you don’t make the problem worse, even if you make it slightly better, the ethical burden of the problem falls on you as soon as you observe it. In particular, if you interact with a problem and benefit from it, you are a complete monster."

https://blog.jaibot.com/the-copenhagen-interpretation-of-eth...

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

#223

Post by sharkmerry »

logicchains wrote: post #171
christophilus wrote: post #143

Earlier quoted context omitted.

This brings up a tangential question I've had lately. When I played video games (especially RPGs), I always ended the game with a mountain of unused resources at my disposal. I rarely used items, cash, etc, unless the ROI was plainly evident. Many of my friends would just burn through cash / items as soon as they had them, and were often in a bind during tough battles / situations. I wonder if this followed us into l…

There was a studying showing that the trait behind this tendency towards saving, the ability to delay gratification, is present relatively early in childhood, and has strong predictive effect on success in life: https://en.wikipedia.org/wiki/Delayed_gratification#The_Stan... . Perhaps this implies that no matter how rich society gets, there'll always be people who just burn though whatever they earn. This would parti…

There was some challenge to this experiment. Once family and parental education were accounted for, the difference largely disappeared after age 15.

I read elsewhere theorizing, that kids from more secure backgrounds will delay more likely as the delay has been rewarded in the past. Whereas, if every dinner is fighting over scraps, they will probably take the initial marshmallow

https://www.theguardian.com/education/2018/jun/01/famed-impu...

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

#224

Post by neffy »

logicchains wrote: post #171
christophilus wrote: post #143

Earlier quoted context omitted.

This brings up a tangential question I've had lately. When I played video games (especially RPGs), I always ended the game with a mountain of unused resources at my disposal. I rarely used items, cash, etc, unless the ROI was plainly evident. Many of my friends would just burn through cash / items as soon as they had them, and were often in a bind during tough battles / situations. I wonder if this followed us into l…

There was a studying showing that the trait behind this tendency towards saving, the ability to delay gratification, is present relatively early in childhood, and has strong predictive effect on success in life: https://en.wikipedia.org/wiki/Delayed_gratification#The_Stan... . Perhaps this implies that no matter how rich society gets, there'll always be people who just burn though whatever they earn. This would parti…

Unfortunately you can´t really do much with magnitudes of money - it´s all about the relative price level. Working in Silicon Valley with 6k/month income, and 4k/month housing expense makes you significantly worse off than the person with 4k income and 1k housing expense living in the midwest, say, who is consequently much more able to save. A similar comment applies with respect to comparing absolute prices between countries.

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

#225

Post by theseadroid »

logicchains wrote: post #146
theseadroid wrote: post #34

Earlier quoted context omitted.

Just like the rich didn't get rich entirely because of their own abilities, poor people didn't get poor because they chose to. Placing the poor people in an environment where there are better education, better healthcare and better career opportunities always results in better financial decision making. So the society bears most if not all responsibilities. How can we eliminate poverty if it's entirely personal respo…

>Like slavery and apartheid, poverty is not natural. This is absurd. Man in nature has no house, no car, no money, no tools, no storehouse, he can eat only what he can catch, kill or forage for. Everything we have in civilisation was built by people working hard to escape the poverty and brutality of nature.

Yes. But no one is poor if everyone is poor. Poverty is a relative term. It's basically inequality in disguise.

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

#226

Post by geggam »

ceejayoz wrote: post #212
geggam wrote: post #81

Earlier quoted context omitted.

So you quit loving your mom and dad at 18 ? And Im callous ?

You're getting it backwards. Your parents are only legally required to care for you up until your 18th birthday. Their function as a safety net may end at that moment. Plenty of folks have shitty, abusive, or neglectful parents who wash their hands of their children at the first opportunity.

You have it backwards.

The parents have children to continue their genetics / DNA. IF the parents don't care enough to continue their DNA that is called evolution.

Then it's up to you the individual to succeed. No one else.

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

#227

Post by awinder »

geggam wrote: post #215
awinder wrote: post #133

Earlier quoted context omitted.

~whoosh~

You choose what to respond to, if I wanted to be offended I could have. If I wanted to take a kumbaya moment from that I could have. I responded the way I wanted to. Implying I am unintelligent because of that is a limited perspective.

~whoosh~

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

#228

Post by driverdan »

notus wrote: post #2

I feel like the government should be offering some type of non predatory debt relief comparable to this. This service is only a detriment to the borrower due to the crazy high interest rates, but I think the government could break even with much more reasonable interest rates, consumers would be better off financially, and the predatory industries would disappear since they can't compete.

This is the market at work. The reason the rates are so high is that the market put them there. These are high risk borrowers and many will default. Lower interest rates would result in a negative ROI. Tax dollars should not be subsidizing defaulted loans.

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

#229

Post by driverdan »

wefarrell wrote: post #195
C1sc0cat wrote: post #156

Earlier quoted context omitted.

You have 100k in debt in your name wow as they say that's a "brave choice"

It's substantially less risky than having a mortgage on a home.

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.

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

#230

Post by geggam »

ianleeclark wrote: post #213
geggam wrote: post #205

Earlier quoted context omitted.

You mean they cant go around cleaning houses / cooking for people or some other service job ? Why do undocumented workers come here for the opportunity ?

> Why do undocumented workers come here for the opportunity ? Because the United States has a bad habit of bombing their countries, killing their labor leaders, and destabilizing their economies through forced privatization and resource extraction.

Now you have started talking about the real issue. IMF , world banking , Federal Reserve.

The folks who can p00f money into existence from nothing (QE) then loan it to you so you have to work to pay back something they imagined into existence.

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