Declare Your Independence from Debt Trap Lenders
Avoid cartoon bears and lending lions
The Dave App is ready to help you get the cash you need for a perfect 4th of July celebration.
You can get the money in minutes - then keep paying for it for months!
Of course, what Dave doesn’t mention is the ridiculous interest rates and cycle of debt that are both key features of their lending model.
A story from the L.A. Times digs deeper, explaining just how bad the fees associated with friendly, cartoon bear apps can be.
Here’s how the Times broke down the fees associated with a loan from Dave:
Given that the money had to be repaid in 12 days, the $5.99 fee and $2 tip, if considered as interest, cost Goad 122% on an annual percentage rate basis — a metric that helps compare the relative cost of loans. If he tipped $6.93, the company’s average in the first quarter, it would amount to an APR of nearly 200%. If he chose a 15% tip, the total cost would rise to $35.99 with an APR of 547% — corner payday loan territory.
If cartoon bears aren’t enough, perhaps you’d like a helping hand (or paw) from a lending lion?
MoneyLion is another dangerous payday predator out to get your cash all under the guise of helping you out.
A game of chance - and a chance to get deeper into debt.
Plus, RoarMoney sounds pretty awesome.
Until you pay the triple-digit interest rate:
MoneyLion violated Minnesota state law by failing to be licensed by the state when it provided Minnesota-based consumers with certain loans with excessive annual interest rates of up to 645%. The settlement includes more than 700 loans issued to Minnesota consumers between November 7, 2016 and September 15, 2017. These loans ranged from $300 to $2,000 and MoneyLion charged interest rates from 9.79% to 645%.
And if Lions and Bears don’t alarm you, a 4000% interest rate loan just might. That’s what SoLo Funds has been serving up:
For freedom from a cycle of debt, avoid these debt trap lenders.