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Greedheads

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Sherry bought a new washer and dryer yesterday. She bought them at a local, family owned store, which is good, and they offered her interest-free financing for 18 months, which is very good, considering that I don't get paid during the summer (my choice).

Anyway, I've got the credit card agreement here, and the annual percentage rate (APR) for purchases and balances transfers is—get this—29.99 percent. Let's skip the subliminal .01 percent and call it what it is: a 30 percent interest rate. Plainly and simply, this is usury: the lending of money at exorbitant rates of interest.

This practice has been condemned by all manner of faiths and cultures since the time of antiquity. I'm not against someone profiting from lending money to someone else, but a 30 percent is unbridled, unadulterated greed. No, wait. That's not a strong enough word. Interest rates like that aren't greedy. They're rapacious.

But with all manner of congressmen and senators in their hip pockets, the banksters don't have to worry about our government "for the people" passing any laws to bring those rates down.

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( 8 comments — Leave a comment )
nodressrehersal
Jun. 25th, 2011 09:03 pm (UTC)
We've made a few of those purchases lately, between home and the income property. It's great to take advantage of the interest-free financing, as long as the balance is paid off BEFORE the introductory term expires. That 29.9% must be the maximum allowed by law, because all our deals have the same terms as yours.
patrick_vecchio
Jun. 26th, 2011 05:48 pm (UTC)
The title from a Robert Cray CD comes to mind: "Shame and a Sin."
cam_1089
Jun. 25th, 2011 10:53 pm (UTC)
I heard something about a credit card interest rate cap. I know in '08 Hillary boasted she'd voted for a 30% cap, but I can't recall if it passed.

Wouldn't surprise me if banks were looking for 29.99% when the cap's 30. Typical avaricious bull out of the money changers Citizens United is letting buy our government.
patrick_vecchio
Jun. 26th, 2011 05:47 pm (UTC)
You're right, Cam: the fallout from Citizens United—or should I say, the snowballing that will result—is only just starting and will be uglier than we can imagine.
android_weber
Jun. 27th, 2011 02:47 am (UTC)
Giles Boothway taught me a lot in about 45 minutes about credit. For the record, I think it's counter-intuitive that I have to borrow money to have a good credit score. Shouldn't the fact that I haven't had to borrow any count for something? (hypothetically speaking)
sarahk809
Jun. 27th, 2011 11:46 am (UTC)
That's so true about borrowing for credit scores--the very best scores are for those who have borrowed a lot (on credit cards, especially!) and paid it all back on time. Those prudent people who saved/invested until they had enough to purchase only get medium scores. Counter-intuitive is right. I guess that's why it's a "credit score" and not an "overall intelligence/awesomeness score."

As for the "interest free financing," I cringed every time I saw those "Pay nothing until 2015" ads--people will really love paying 30% interest + principal on their 4 year old furniture. $300 chair now or $2000 7 years from now when it's finally paid off? So many people take the $2000 option.

It's a great deal though, for a wise couple like you and Sherry--18 months with no interest is a good thing to take advantage of--be prepared for a barrage of credit offers when you pay them off before they get your 30% interest.

One more thing, you are also wise to buy a washer/dryer from a local/family store--we bought from them for years until Home Depot came along--we got a great price on a refrigerator, but 3 years later, the water dispenser is broken--the repairmen have been here 4 times (each time with a 2 week wait since he covers a whole region; once he showed up with the wrong part and had to re-order so 2 more weeks) Still not fixed since he determined we need a plumber to repair the water valve (plumber said valve is good, fridge is bad.)
The local family store would have charged about $400 more for the same model, but the repairman would have fixed it in a day (even at night if he had to) or replaced it if the whole thing was defective (since it's under warranty).
patrick_vecchio
Jun. 27th, 2011 12:10 pm (UTC)
I don't think the local folks can compete price-wise with Home Despot on major appliances, but then again, I bought a dehumidifier two summers ago and the local store beat the big box by $50 for the same unit.

And as you point out, it's no contest when it comes to service.
patrick_vecchio
Jun. 27th, 2011 11:58 am (UTC)
I like Giles. Sharp, with a deliciously wicked sense of humour.

You would think someone who hasn't had to borrow money would get an excellent score, but nothing works in the consumer's favor in a world where 30 percent interest is a given.
( 8 comments — Leave a comment )

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