Jan 6, 2009

Adventures in Loan Sharking

More junk mail from the banks this week. With rates at all time lows, a letter from Bank of America says we're pre-qualified for some huge loan amount. The reality is probably that this is boiler-plate text and if one were to apply they would get a much lower limit.

Anyway, the fun part is that the initial interest rate is 7% (sneaky, they call it 6.99%) but the fine print says that if you miss a payment they can adjust the rate up to 28% (sneaky, they call it 27.99%).

Obviously, if you can't make your payments QUADRUPLING the interest rate will only make it harder, if not impossible. Seems more like the financial equivalent of a mob enforcer breaking your legs if you can't pay up.

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