Avoid These Predatory Lenders at All Cost

Predatory lenders are like the devil — they legally charge you insanely high interest rates that keep tens of millions of Americans in a vicious financial trap.

Who Can Fall Victim to a Predatory Lender?

• Anyone can, however it is very common to happen to families making less than $50,000 a year.
• The most common victims of predatory lenders are people living without a credit score — 45 million Americans are considered credit invisible according to the CFPB.
• The next largest segment of Americans affected are those living with marginal credit scores under 620.
• It's also very common for these predatory lenders to have retail locations in neighborhoods where families live in subsidized housing.

The Predatory Lenders You Should Avoid at All Costs

• Check Cashing Stores — APRs as high as 700%.
• Buy Here Pay Here Car Lots — focus on people with no credit and have a 33% repossession rate; the business model is sell, repo and resell. Rinse and repeat!
• PayDay Loan Stores — APRs up to 300%.
• Rent-to-Own Furniture Stores — you end up paying 300% more for a TV or sofa.
• Online stores like FingerHut — 200% more than Target for the same item.
• Title Loan Stores — in Alabama, title loan interest can reach 25% per month on principal, an APR around 300%.
• Personal Loan Stores ("Need cash for Christmas?") — APRs for cash advances in Tennessee can reach 279%.
• Never get an auto loan at the car dealer — they will broker you to dozens of lenders and your credit score will take a huge hit from credit inquiries.
• Go to your local credit union and get a car loan at a good rate with no down payment.