Author Topic: Why some people are paying higher interest in Lending Club to finance debt?  (Read 3391 times)

watermen

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I was browsing notes just now, in some of those F and G notes, I just don't understand why some people who have an interest rate of 15% for their credit cards, are willing to pay 22-23% to lending club to consolidate their debt? Isn't it weird, and a lot of them get their funds really fast.

I just don't understand, or am I missing something. Please, someone kindly explain, I am still new in is.

Rangifer

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23% is still better than 29.99%

they may also get one payment that is lower than paying several credit card minimums.

TomTX

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Once they pay off the (maxed) credit cards, they can go charge stuff again, of course!

Rangifer

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Also, stay the hell away from F and G grade notes. Once you take the default rate into account, they don't do any better than C grade notes.

arebelspy

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Also, stay the hell away from F and G grade notes. Once you take the default rate into account, they don't do any better than C grade notes.

So would you advise to stay the hell away from C notes as well, since they apparently do the same as F and G, for which you give that advice?
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watermen

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23% is still better than 29.99%

they may also get one payment that is lower than paying several credit card minimums.

Some of them said their credit card interest is like 15%, but they are borrowing from lending club for 22%, that is what puzzled me.

Forgive me, I don't have much experience with credit card, I only have one card and it automatically get paid off from my checking account every month, therefore I never pay attention to interest rate, since I had never owe money.

Does most credit card charge 29.99% if you can't pay off everything?


Rangifer

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Also, stay the hell away from F and G grade notes. Once you take the default rate into account, they don't do any better than C grade notes.

So would you advise to stay the hell away from C notes as well, since they apparently do the same as F and G, for which you give that advice?

You got me!

What I meant to say is that they do worse than C notes.

MrChanticleer

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Does most credit card charge 29.99% if you can't pay off everything?

Yes. Speaking from experience (unfortunately), it is very possible to have a credit card (or multiple cards) with interest rates as high as 29.99%.

Skyn_Flynt

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People can easily end up paying 50% interest at those "rent to own" stores and pawn shops. Somehow the idea of $50 a month for a year sounds more appealing than paying $400 today, and folks will not grasp how high that implicit rate really is.

grantmeaname

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Isn't that like 100% interest?