This should be illegal!!!

[Rob]

We all know how prevalent loan adverts are, especially on Sky. And how they will give to anyone, which is extremely wrong!

But has anyone else noticed that new TV ad for APS mortgages? Check the terms at the bottom. £100,000 loan - £463 per month for twenty five years then final payment of... £100,000!!!! Total payable is in the region of £287.000 (this total may be wrong - doing from memory).

Who in their right mind would pay for all this time, then have a final payment that is exactly the size of their original problem.

Has the world gone completely MAD?

[Knoxville]

What annoys me is using the ad's in between daytime t.v when only students and the un-employed are gonna be watching, the 2 groups of people that really can't afford a loan tbh

[madocks]

We all know how prevalent loan adverts are, especially on Sky. And how they will give to anyone, which is extremely wrong!

But has anyone else noticed that new TV ad for APS mortgages? Check the terms at the bottom. £100,000 loan - £463 per month for twenty five years then final payment of... £100,000!!!! Total payable is in the region of £287.000 (this total may be wrong - doing from memory).

Who in their right mind would pay for all this time, then have a final payment that is exactly the size of their original problem.

Has the world gone completely MAD?

Being a first time buyer, i can see what they are doing, they are advertising an interest only mortgage. Not many people can afford the £700 a month repayments that comes with a 100K mortgage.

TBH, £463 is pretty dammed good on interest only, Barclays would charge more than that

[TeePee]

It's an interest only loan or mortgage. The idea is, they lend you the money, you pay the interest for it, and at the same time invest a monthly sum. Since money invested in the stock market grows at a faster rate than money invested in property (assuming this were a mortgage) at the end of the 25 year period you'd be able to pay off the loan comfortably. It means for smaller monthly payments than a repayment loan or mortgage.

[Big RICHARD]

Aren't these also known as endowment policies?

[Rob]

Aren't these also known as endowment policies?

And we all know the history of them...

[myth]

If anyone would like a REAL loan I got this frend up in Las vegas... Its 10% or two fingers! Your choice! Oh, its best if you dont have any family! Or dogs....

[MAS]

What I REALLY hate is the adverts for consolidation loans - you know 'one low monthly payment' for people who are stupid enough to owe so much money to several credit cards, loans, store cards, that they can't cope.

And they always say at the end 'when I'd finished paying off my existing debts, I had enough money left over for a luxury holiday!' or new car, or whatever it is.

Right, because spending money on frivolous things that arent essential is a good idea, considering how you got yourself into this position in the first place...

Tbh the whole credit thing is out of control. Everyone is desperate to offer you some form of credit. I mean I went to B&Q the other day and someone actually approached me and started trying to get me to take out a B&Q card for a purchase that was like £20.

[Swafe]

them ads do annoy me

but with any loan, even a cheap morgage, over 25 years all the interest normally collates to about 250k, ok your paying more but your borrowing it, and the key fact is, if you put 100k in the bank now, in 25 years it would ne nearing 200k anyway

on top of that, the worth of money goes down, paying them 100k back in 25 years, will be like paying someone about 40k today....in 25 years we should expect 100k to be average wages for about 2 years work for the normal joe

[Allen]

What I REALLY hate is the adverts for consolidation loans - you know 'one low monthly payment' for people who are stupid enough to owe so much money to several credit cards, loans, store cards, that they can't cope.

That's a bit harsh mate. I'm not stupid, but I got caught up in a spiraling debt problem a few years ago because I was a little naive with cards. Your comment calling all people who owe money (probably 99% of the nation) stupid is out of line.

[Allen]

on top of that, the worth of money goes down, paying them 100k back in 25 years, will be like paying someone about 40k today....in 25 years we should expect 100k to be average wages for about 2 years work for the normal joe

Well done Swafeman, that nearly always overlooked by people today.

30 years ago, my parents had the chance to buy their house for about £3000, paying back around £7000 but they didn't think they'd be able to afford it. 25 years later the house was worth over £200k and £7000 would've been NOTHING compared to the cost of the house.

It's a damn good investment, even paying nearly 3 times the original amount borrowed. The house will probably be worth more than 3 times the amount you bought it for after such a long time.

[MAS]

Not IMO - anyone who's old enough to have credit should be old enough to consider the consequences and accept them. It's not rocket science to live within your means.

I accept that there are some people who get into difficulties and it's not really their fault. But these days, the consumption culture that this country enjoys breeds a greedy mentally, where everyone wants everything now, regardless of whether they can really afford it.

I didnt call all borrowers stupid - most people have a mortgage. I have credit cards, an overdraft, etc. I owe money. I called people who found themselves in serious debt difficulties because they had spent irresponsibly stupid. I.e. people who get credit and fail to recognise that it's money that has to be paid back, so spend it on extravagant things that they cant really afford.

I don't think that's out of line at all. People are entitled to their own opinion, and mine is that you're pretty stupid if you're irresponsible with credit. It's a privilege, and one that you should only accept if you can handle the responsibility.

And, for what it's worth, I'm not just blaming individuals - I think some of the lenders are at fault as well for the way they promote credit.

[Swafe]

it does suck tho, how they make young people have credit cards, and they work up a small amount of debt, say 1000 quid, then after high interest and even more high interest, it soon snowballs out of control as they cant pay it back and before they know it its 10-15k, and they have to pay it back

[Kezzer]

How about this one then

"NO WIN NO FEE"

What if you win though?

[MAS]

it does suck tho, how they make young people have credit cards, and they work up a small amount of debt, say 1000 quid, then after high interest and even more high interest, it soon snowballs out of control as they cant pay it back and before they know it its 10-15k, and they have to pay it back

The credit companies could certainly do more to make people aware of what they're getting themselves into. But then again, I guess they dont want to.

[Swafe]

How about this one then

"NO WIN NO FEE"

What if you win though?

no win, no fee,

win ? they theyll take a massive %age of what you do get, probably works out better paying for a lawyer....because then if you win youll get a much bigger portion of the cash

and with compensation sueings left right and center, your sure to get some cash if you got a good case