Highest Interest Poll 10 October 2006 at 12:35PM in Money Saving Polls 12 replies 4.2K views

Former_MSE_Andrea

Poll Title: Poll Started 10 Oct: If you were to borrow £100 over a week, above what level would you consider the interest to be extortionate?

A. 5% APR
B. 25% APR
C. 50% APR
D. 100% APR
E. 250% APR
F. 500% APR
G. 750% APR
H. 1250% APR
I. 2500% APR

Vote here or click reply to discuss this poll

save-alot

It looks like some companies are way up this list

http://www.myprovident.co.uk/products/LoanCalculator.aspx

Choose cash loan

enter £500

choose 55 weeks

change to 23 weeks

Now thats what I call interest

colemanbrown

good grief! Who would pay that much? and who voted for 2500%? Thing is, interest rates won't come down unless everybody agree not to pay the high rates. Lets face it that's nigh on impossible, someone will always need the money.

jonboy31

I chose 750% as 500% would mean paying back £110 from your loan of £100 - fair in my opinion for such a short term (and no doubt much needed) loan.
I don't think people have read the question properly IMO, quite a lot of people seem to think that 10 pence interest on a £100 loan is extortionate!!!

John

southernscouser

Don't mean to be picky guys but your posts might influence this poll coz it certainly changed my answer!

I didn't even think to work out what the interest would be (slaps wrist) but though anything above 25% was extortionate (sp). Now after reading Al Macs post I would agree with him! :rolleyes:

zx2011

I saw this yesterday in Croydon.

Borrow £1000 for £99 a month for 18 months. Total payments £1782. APR 123%

bigkris_2

Having been in the Home Collected credit trade for many years, I can assure you that Provident's APR is commonplace! I used to work for Stanlor Finance, a part of Wilson Tupholme PLC, and a 100.00 loan was paid back at 10.00 per week for 14 weeks. The APR was a staggering 1024%.

manorfarmdave

Not sure if anyone has come across these people but there was a link to them on an email when I enquired about some car spares recently.

APR advertised as 1355% based on a 30 day loan

Check it out!


http://www.247spares.co.uk/paydayloans/

talbotsunbeamer

This is clearly a bad question, unless it's entirely deliberate to suggest that people don't understand APR rates.

People are not considering that this is an ANNUAL percentage rate which takes effect over one WEEK.

Therefore I would personally consider such a short term loan to be extortionate once it went over £120 in repayment. My calculation therefore suggests £1040 over a year (20% x 52) and therefore 1040% APR.

Am I correct or equally missing the point?

jonboy31

Al_Mac wrote:

It was £100 for a week!

If you work out even the highest APR, that is less than £10 for a week. The lowest APR is pence.

The company would not do it for pence and paying a few quid, doesn't seem unreasonable to me:D

The highest APR is 2500%. This equates to £2500 interest per year. So 2500 / 52 is around £48 for a weeks interest. I'd call that extortionate myself. I'll stick with 750% as my answer (nearly £15 interest for the week.)

John

MSE_Martin

Don't mean to be picky guys but your posts might influence this poll coz it certainly changed my answer!

I didn't even think to work out what the interest would be (slaps wrist) but though anything above 25% was extortionate (sp). Now after reading Al Macs post I would agree with him! :rolleyes:

Quite right - so sssh (and you may want to take a look at the results of a similar but different poll a couple of weeks ago - and see where I'm going with this) but don't look until AFTER you've voted!

Martin