Thursday, August 04, 2005

Loan Traps with 280%. per year interest

Often times the people who need money the most end up paying extremely high interest resulting in a deep downward spiral.

On of the most vicious loan traps are

In a title loan, you give the title to your car and a copy of your keys to a lender as security for a loan. If you don't repay the loan, or if you fall behind in your payments, the lender simply takes your car, sells it, and pockets the money that's owed.

The fee for a title loan can be more than 20 percent a month. So a $1,000 title loan can cost more than $200 a month in interest fees. If it takes you a year to repay, that $1,000 loan will cost you more than $3,800. A title loan is not the way to get back on your feet if you're having financial problems. It's a trap that's likely to pull you deeper into debt.


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