Reporting Highlights
- Wave of Lawsuits: Since introducing the Flex Loan in 2015, Tennessee-based lender Advance Financial has filed over 110,000 lawsuits against its borrowers.
- High Interest and Fees: Flex Loans offer borrowers up to $4,000 at 279.5% interest, trapping thousands of people in debt that can land them in court.
- Sidestepped Federal Regulators: Advance Financial lobbied lawmakers to create the new Flex Loan to avoid federal consumer protection regulations.
That’s slightly more than 1.5% of the entire state.
Borrowing 4k for 30 days, results in a total repayment of 4918$. Borrowing 4k and paying it off every 30 days for 12 months, results in a total repayment of 10593$. This doesn’t seem very christian.
I 100% fixed my credit score with these types of shitty high interest loans. I took it from 450 to 700 pretty fast.
I realized that credit score formulas are heavily weighted by payment history and credit balances. I had no credit card balances but I had bad payment record from being a stupid kid in college.
Once that dawned on me, I put all my debt into a high interest loan. Made a payment or two then my credit score would go up a bit, and I’d refinance to a somewhat lower interest rate. Those high interest loans kill most people on interest so they don’t have origination fees. I kept refinancing to better rates until I got down to a reasonable number. By then my credit score was 700 and I could make consistent affordable payments until it was gone.
I wouldn’t recommend this to most people. It takes a lot of research and planning. The financial landscape has changed a lot since then too.
NOTE: Just because I had a success story with these doesn’t mean I think the types of loans are good. I found a loophole.
I think this industry is fucking gross and they target people in my situation with little knowledge of how loans and credit work. It’s a shame the CFPB couldn’t do more to stop it and now they are dead too.
279.5% interest… what the fuck
That is so far beyond predatory…the only reason to let this exist is to create wage slavery.
That’s loansharking minus the guy threatening bodily harm to get you to pay.
If you borrow 4,000 to refund it at the end of the thirst month it would cost 11,160?
Do you mean that first month? It’s an annual rate, so you would pay $932 a month, plus compounding every month after.
Why would anyone accept a loan with 280% interest?
I just told a story about doing this in another comment
It wasn’t on a whim. I had a plan and it worked. I don’t think most people are doing what I did and they are just taking these loans out without a plan or understanding on how bad they can be.
Desperation. Stupidity. Ignorance. If people weren’t doing stupid shit with their finances, companies like this and BNPL companies wouldn’t exist. They are all feeding off of desperation.
Had a coworker who decided during his shift that he was going to buy “that” TV that he pointed at.
Of course he did not have the funds to do so.
So he went to the payday loan place in the parking lot.
He didn’t last long at that job. Wonder if he ever paid that off…
Would be very interesting to see how many of those 100k voted for the Republicans that cleared the way for this to become legal
Well it’s Tennessee, so safe to say A LOT…
Of course they said they’d help people.
They wouldn’t get many takers if their advertising started with “Hey fuckface! Just because you’re poor as dirt that doesn’t mean you can’t line our fucking pockets.”
Salt in the wound: The default judgements locking in wage garnishment to pay illegal parts of the debt (on top of the immorality legal ones) because the kind of people who get these loans have many responsibilities and often can’t make an arbitrary court date, and it’s not clear to them the stakes are “show up or lose all recourse” (no appeals are possible).
These kinds of interest rates are why payday loans got the regulatory hammer to crash down and smash them to bits.
helped Tennesseans not trust lenders …
I love the uneducated.
