Loan Sharks

[Keith Broaders]

A Payday Lender is loaning me $400 per month and is charging me $45 per month in interest. In the next 12 months I will forced to pay $540 in interest.

If a Good Samaritan were to loan me $400 for 12 months I would be willing to pay $33.33 in principle plus a service fee of $6,67 per month.

The lender would receive a return of $80 on a $400 investment and would be helping me to escape from  the predatory pay day lenders. To obtain an equivalent yield you would need to earn a return of 20%,

The Pay Day Lenders score outrageous profits at the expemce of those who can least afford it. They receive an annual yield of over 1000% on a 12 month $400 loan.