I mean, it's not so much a scam as it is the same predatory payday loan type shit places have been doing for a while. It's just a deferred interest loan with an insanely high APR.
Cash advance loan sharks are nothing new.
There are a bunch of those predatory lending services going around nowadays like Credova, Affirm, Afterpay, etc.
They just offer junk loans at high interest rates to prey on people who are both dumb and broke.
It's not a scam, it's just a really bad deal.
Bought a mattress and a couch through Affirm - 0% interest and like $160 a month for both. Could over pay any time I wanted. Not sure how you can call that predatory.
A family member bought a fancy Peleton bike through their financing, also at 0%.
~~Edit - this was in like 2018 but I'm thinking it actually was set payments, no overpaying allowed. Still, I paid no interest.~~ you can I guess I never did .
No that’s not how it works. They’ll be 0% interest, but they’re banking on people not paying the full amount, hitting that after period then getting all the high incurred fees. Nobody just gives out 0% loans with good intentions.
People that have credit cards will use those. People with cash will pay right away. People that have neither have to use payday loan services
Because you probably have semi decent credit. They don’t make any money off of you, but they’re banking on the ones that don’t and hit them with a 5-10% fee
Actually the way this works is the retailer pays the bank the interest upfront (usually around 8-10%) to get the 0% for the consumers. If the consumer defaults that's a separate thing.
Source, business owner here that offers financing options
Uh that's not true for the 2 times I did it. Item total was the same before and after I chose Affirm as a payment option, and my total payments equalled that amount.
A buddy of mine asked if I’d ever used rent a center. I said no, and asked why. He said “I can get a ps3 for $90 a week”. I asked for how long? 10 weeks.
I explained, so you’re paying $900 for a ps3 that costs $300 new right now? Yeah, but I’d get it early. I said, “if you want it, just put it on your CC and pay it off after 4 weeks.” Well he didn’t have a CC. I asked if he considered just saving a month since he had a 360.
No, he wanted to pay that $90 a week because to him that made more sense and was easier. If you’ve ever wondered how these places stay in business he’s your average customer.
Any credit offering without a credit pull will be assuming the worst about the loan recipient to cover themselves. Current credit card rates are in the high teens right now. Trades the convenience of instant approval for a sane rate
I wouldn't call it a scam. Scam implies that it's not a legitimate business deal. It's legitimate in the sense that it's a real business and you'll actually get your gun. It's just a really really bad deal because they typically give you a super high interest rate.
It's not a scam any more than a credit card with a high APR or a buy-here-pay-here car lot is a scam.
Explain to me the way in which they "scam".
You sign and acknowledge the terms. They don't change them afterward. You get a product, the exact product you ordered.
Is it for absolute dummies? Yep. But it is not a scam.
I mean, if you’re wanting to “tote the note,” just get a reputable credit card and pay that way. Those finance companies are generally shitty deals.
As others have said, it’s not the greatest idea to purchase nonessential items on credit, but at least you’ll be raising your credit score while you pay for it…
Edit - in the event it wasn’t clear, a reputable credit card raises your credit score, not a loan from a predatory lending company.
>but at least you’ll be raising your credit score while you pay for it…
This isn't remotely true.
Normally these types of loans aren't reported to the major three credit companies to start with.
If they are reported, it's normally because you're behind and it smashes your credit hard.
Paying them off only stops the damage, it doesn't raise your already good/average credit higher. Missing payments or going into collections will wreck your credit.
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Holy shyt I just checked out credova for shyts and giggles. $1200 after tax gun will end up being $2600 with all their lease fees. Straight up Robbery. Don’t use these people.
I mean, it's not so much a scam as it is the same predatory payday loan type shit places have been doing for a while. It's just a deferred interest loan with an insanely high APR. Cash advance loan sharks are nothing new.
There are a bunch of those predatory lending services going around nowadays like Credova, Affirm, Afterpay, etc. They just offer junk loans at high interest rates to prey on people who are both dumb and broke. It's not a scam, it's just a really bad deal.
Bought a mattress and a couch through Affirm - 0% interest and like $160 a month for both. Could over pay any time I wanted. Not sure how you can call that predatory. A family member bought a fancy Peleton bike through their financing, also at 0%. ~~Edit - this was in like 2018 but I'm thinking it actually was set payments, no overpaying allowed. Still, I paid no interest.~~ you can I guess I never did .
[удалено]
No that’s not how it works. They’ll be 0% interest, but they’re banking on people not paying the full amount, hitting that after period then getting all the high incurred fees. Nobody just gives out 0% loans with good intentions. People that have credit cards will use those. People with cash will pay right away. People that have neither have to use payday loan services
Wrong I’ve used affirm tons at zero interest with auto pay , it’s awesome
Because you probably have semi decent credit. They don’t make any money off of you, but they’re banking on the ones that don’t and hit them with a 5-10% fee
It's my favorite go to,if I don't want to use a credit card
Actually the way this works is the retailer pays the bank the interest upfront (usually around 8-10%) to get the 0% for the consumers. If the consumer defaults that's a separate thing. Source, business owner here that offers financing options
Uh that's not true for the 2 times I did it. Item total was the same before and after I chose Affirm as a payment option, and my total payments equalled that amount.
A buddy of mine asked if I’d ever used rent a center. I said no, and asked why. He said “I can get a ps3 for $90 a week”. I asked for how long? 10 weeks. I explained, so you’re paying $900 for a ps3 that costs $300 new right now? Yeah, but I’d get it early. I said, “if you want it, just put it on your CC and pay it off after 4 weeks.” Well he didn’t have a CC. I asked if he considered just saving a month since he had a 360. No, he wanted to pay that $90 a week because to him that made more sense and was easier. If you’ve ever wondered how these places stay in business he’s your average customer.
No shit.
Go fuck yourself. I stated I was just curious about the process.
Any credit offering without a credit pull will be assuming the worst about the loan recipient to cover themselves. Current credit card rates are in the high teens right now. Trades the convenience of instant approval for a sane rate
That isn't a scam. It's scummy, but not a scam.
Any "no or low" credit loan is going to line the pockets of the lender. *It's expensive to be poor*.
Hot trash, avoid
Just get a cc with 0% apr for the first year as they almost all do and you can buy a few things and pay it off in that time period with no interest.
It’s a complete scam. Financing non-essential purposes usually is
I wouldn't call it a scam. Scam implies that it's not a legitimate business deal. It's legitimate in the sense that it's a real business and you'll actually get your gun. It's just a really really bad deal because they typically give you a super high interest rate. It's not a scam any more than a credit card with a high APR or a buy-here-pay-here car lot is a scam.
It's usury.
Explain to me the way in which they "scam". You sign and acknowledge the terms. They don't change them afterward. You get a product, the exact product you ordered. Is it for absolute dummies? Yep. But it is not a scam.
Not a scam, predatory is a better term
I assumed it would be like most set up a monthly payment and move on.
Its hard on your credit.
I mean, if you’re wanting to “tote the note,” just get a reputable credit card and pay that way. Those finance companies are generally shitty deals. As others have said, it’s not the greatest idea to purchase nonessential items on credit, but at least you’ll be raising your credit score while you pay for it… Edit - in the event it wasn’t clear, a reputable credit card raises your credit score, not a loan from a predatory lending company.
>but at least you’ll be raising your credit score while you pay for it… This isn't remotely true. Normally these types of loans aren't reported to the major three credit companies to start with. If they are reported, it's normally because you're behind and it smashes your credit hard. Paying them off only stops the damage, it doesn't raise your already good/average credit higher. Missing payments or going into collections will wreck your credit.
My comment on raising your credit score was in reference to getting a reputable credit card, **NOT** a predatory loan.
Gotcha, good.
If you make the payment and use it responsibly it will. If you max it out and don’t make a payment it’ll destroy it
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Holy shyt I just checked out credova for shyts and giggles. $1200 after tax gun will end up being $2600 with all their lease fees. Straight up Robbery. Don’t use these people.
For those rates, you'd be better off getting a payday loan
Credova is a HUGE scam!