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Tuesday, April 3, 2007
Don’t fall victim to title loan bloodsuckers
The Atlanta Journal-Constitution
My roommate recently came to me and told me something that nearly made my heart sink.
“Dude, I almost got one of those title loans.”
Titled car loans are short-term, high interest loans that use a borrower’s car title as collateral. They produce fast cash with little hassle. However, borrowers often do not understand the ultimate price of their title loan - which is cryptically hidden in contracts with confusing financial language.
According to georgiawatch.org, a consumer affairs watch dog that monitors business practice that affects Georgians, “when borrowers cannot keep up with payments on the triple-digit interest common in the business, title lenders take possession of borrowers’ cars - oftentimes their only transportation to work, the grocery store and doctors’ offices.”
My roommate had been out of work for a couple of months. He’d been through the Christmas holidays, had the normal bills to pay — including car insurance — and he was having a difficult time getting his feet back on the ground. He found himself in a position similar to those that get targeted by these “financial institutions.” He was desperate.
He owned a car, and he thought that using this as collateral would be an easy way to catch up on bills and payments until things got back to normal.
The AJC did a series of articles a couple of years ago — 2005, to be exact — about how people had lost their cars to the repo man because they got nailed by these loans. Fortunately, I remembered a lot of these stories and related them to my roommate.
“Man, how can these people get away with that,” he asked when I was done.
“Landowners had to make money off of the sharecroppers. We’ve swapped plows and horses for cars. The landlords got rid of their overalls and shotguns and replaced them with suits and lawyers,” I told him.
He had other options. He had his parents. He had me. There was no way I was going to let him fall into bed with these leeches.
He has since found gainful employment, doing work that he really enjoys. He’s getting back on its feet, much sooner now than he would have if he had taken that loan.
I feel bad for those people who don’t have other options like he does. I feel bad that there are bloodsuckers who prey every day for those people who don’t have other options. A fair profit is one thing. Legalized robbery is an entirely different matter.
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