Bad credit consumers being targeted with high interest loans
December 17, 2008
In the current financial climate, with the banks in turmoil and lending highly restricted, most are under the impressions that getting any form of finance with a bad credit rating is nigh on impossible. However, a recent report has suggested otherwise, claiming that some consumers with bad credit are actually being targeted by lenders who want to try and make them take out loans with extremely high rates of interest attached.
Under new rules and regulations, which came into force in January, lenders are required to ‘undertake proper and appropriate checks on the potential borrower’s creditworthiness and ability to repay the loan and to meet the terms of the agreement‘.
However, despite these requirements it seems that some lenders are still targeting bad credit consumers in the hope that they will take out high interest loans through desperation, simply because that it all they can get.
Some lenders are even advertising their no credit check loans on popular sites such as Facebook, which is used by many younger people. One such loan is Logbook Loans, which secured the loan against the car, and charges huge sums of interest.
Its advertisement stated: ‘If you’re looking for a loan with no credit check, you’ve come to the right place. That’s what makes Logbook Loans ideal for those with bad credit history, CCJs, arrears or defaults. Come to us and there’s no credit check to let you down - so you can get your hands on extra cash quickly and easily.’
An official from the credit reference agency, Equifax, said: ‘We are starting to see a vicious downward spiral. Now legitimate sub-prime lenders have been driven out of the market, borrowers are being forced to use less responsible subprime lenders.’
- Affordable first time buyer mortgages launched by post office Over recent years first time buyers have experienced many difficulties when it comes to getting onto the property ladder, and with everything from high property prices to mortgage restrictions and high deposit levels to hinder
- 125 families a day hit by repossession According to figures that were recently released around 125 families a day across the UK have been getting hit by repossession, as many households continue to struggle to keep up with mortgage repayments on their
- Problems with mortgage interest help from Government According to a recent report many officials have pointed out that there are some serious flaws in the scheme that the government has in place to help people with their mortgage interest payments if they
- Bad Credit Loans With consumer debt at an all time high in the UK, many households and individuals have found themselves struggling to keep up with repayments on financial commitments, and all too often this has resulted in
- Car Loans Having to put up with an unreliable vehicle that keeps letting you down and costing you money can be very distressing, but for many people the chances of being able to purchase a more reliable
Comments
Got something to say?