Little Lender Tricks That Can Cost Borrowers Lots of Money
by Mogamahttp://mogama.info
The Personal Finance Company representative had prepared the loan papers in time for my wife and I to sign at 4:30 PM one Friday. With one quick swipe of the pen in hand, the loan representative said, " Your first payment will be $109, and the other 35 payments will be $102 per month. Okay? Sign and date right here. "
Then I noticed that she had checked both boxes for adding life insurance and disability insurance to the loan. With my wife seated to my left, I said, " Wait a minute... We already have life insurance... If I kick the bucket and drop dead, Miss Harriet will pay PFC the $2,000. "
My wife said, " Oh... they added life insurance and disability insurance to the loan? "
The PFC rep said, " Well, I included them because you had them on your previous loan... "
The truth of the matter is, we did not even notice they had sneaked those insurance policies in on us for our previous loan with them. Sadly, we had signed those papers without even noticing the added expenses.
Thankfully, we caught them in the act this time, perpetrating one of the most common tricks by lenders.
The rep said, " If you want, I can remove the insurance policies, but that means I will have to redo the paper work. You want me to? "
We just stared back at her.
She added, " It will take me just ten minutes to print new papers. I'm sorry 'bout that. "
" That's alright... we've got some patience left, " I replied, smiling.
When she re-ran and reprinted the loan papers, our monthly payment had dropped from $102 per month to $88 per month, a difference of $13 per month, or $468 over 36 months of payments.
We felt bad that they had nailed us on the old loan, but felt like smart and alert borrowers this time. You never want to sleep on any lender, no matter how friendly and smiley the loan officer appears, whether you're borrowing from a bank or from a high-interest joint like PFC. (By the way, do you know what their best rate for their most loyal customers with excellent credit was at that time? A whopping 24%... You wonder what interest rates the not-so-good-credit-scores customers pay... You're better off without these suckers in your life.)
→ Register for FREE to writer for Debt Freedom Club.
Article submitted Monday, February 01, 2010 & read 65 times.
Please log in to leave your comments.
No comments yet.
4-0-0-0-8-ADSO