mw
Member of DD Central
Posts: 178
Likes: 81
|
Post by mw on Apr 9, 2020 11:13:16 GMT
That fridge is £41.93 a month for two years now which equates to just over a £1000. So theyve lowered it!
Not sure about this loan either!
|
|
hazellend
Member of DD Central
Posts: 2,361
Likes: 2,179
|
Post by hazellend on Apr 9, 2020 11:28:31 GMT
Are there that many thick people that buy this way?
Why would you pay very high for a new fridge when you can get a second hand one for the cost of 1 months interest?
|
|
r00lish67
Member of DD Central
Posts: 2,691
Likes: 4,048
|
Post by r00lish67 on Apr 9, 2020 11:33:22 GMT
That fridge is £41.93 a month for two years now which equates to just over a £1000. So theyve lowered it! Not sure about this loan either! They've not lowered it, the total cost increases as you increase the loan term. It's 'only' £710 over 1 year. However as the monthly payment goes down the longer term you choose, I would imagine that most of their would-be customers would nonetheless choose the longer term options. It's not a pleasant business model to behold, but there's nothing legally wrong with it providing they don't do what Brighthouse did. There is a section in the borrowing proposal I note addressing how they're different. hazellend unfortunately yes, although not necessarily thick, just desperate and ill-advised. Probably no-one on this forum, but then we're not the ones beings targeted. Some people can make poor decisions when offered something they want/need right now for 'only £4 a week' when they're on a very tight budget. Brighthouse didn't fail because of a lack of customers, it was because they fell foul of consumer protection legislation and ended up with a raft of fines and compensation claims.
|
|
|
Post by Ace on Apr 9, 2020 11:39:48 GMT
Are there that many thick people that buy this way? Why would you pay very high for a new fridge when you can get a second hand one for the cost of 1 months interest? Yes. It's undoubtedly a profitable business model. If we don't support it then either: someone else will; or another business will take advantage and do the same thing. However, despite this, I won't be supporting it. There's more to life than profit. EDIT: Crossed with r00lish, who put it much more elegantly.
|
|
mw
Member of DD Central
Posts: 178
Likes: 81
|
Post by mw on Apr 9, 2020 11:41:02 GMT
That fridge is £41.93 a month for two years now which equates to just over a £1000. So theyve lowered it! Not sure about this loan either! They've not lowered it, the total cost increases as you increase the loan term. It's 'only' £710 over 1 year. However as the monthly payment goes down the longer term you choose, I would imagine that most of their would-be customers would nonetheless choose the longer term options. It's not a pleasant business model to behold, but there's nothing legally wrong with it providing they don't do what Brighthouse did. There is a section in the borrowing proposal I note addressing how they're different. hazellend unfortunately yes, although not necessarily thick, just desperate and ill-advised. Probably no-one on this forum, but then we're not the ones beings targeted. Some people can make poor decisions when offered something they want/need right now for 'only £4 a week' when they're on a very tight budget. Brighthouse didn't fail because of a lack of customers, it was because they fell foul of consumer protection legislation and ended up with a raft of fines and compensation claims. Oh yeah I missed that slider... Good job you're on the ball 😂
|
|
macq
Member of DD Central
Posts: 1,924
Likes: 1,192
|
Post by macq on Apr 9, 2020 12:08:00 GMT
for One reason or another i had already decide it was not for me but have now looked at the website and it must be the only site unless i am blind that has no COVID update or for a big box item details of delivery,install & recycle in the present climate(like say Currys do)
|
|
groon
Posts: 39
Likes: 40
|
Post by groon on Apr 9, 2020 12:25:54 GMT
I'm not touching this one either. I'm not persuaded that the business model is ethically sound and I'm a bit disappointed that Ablrate want anything to do with it.
|
|
|
Post by ablrate on Apr 9, 2020 12:51:31 GMT
Thanks for you opinions. From the ethical standpoint some people are unable to access finance and are therefore not able to buy equipment etc or access finance plans. If they cannot access this through the mainstream then they could turn to less transparent forms of finance. You can argue that people should not buy what they cannot afford, but that unfortunately is not how the world works. In any scenario like this there is a higher rate to cover defaults. We appreciate that is not everyone's cup of tea and we respect your opinions.
|
|
archie
Posts: 1,838
Likes: 1,842
|
Post by archie on Apr 9, 2020 13:00:39 GMT
If they owned the product at the end of the rental period it might have been slightly better.
As it stands they have to pay to return it, keep renting at a lower rate or buy it.
Not for me.
|
|
|
Post by spareapennyor2 on Apr 9, 2020 13:15:44 GMT
really is a never never item not a HP item wonder how many customer`s, will get a surprise at the "end" of term
|
|
greenslime
Member of DD Central
Posts: 111
Likes: 144
|
Post by greenslime on Apr 9, 2020 15:05:06 GMT
Are there that many thick people that buy this way? Why would you pay very high for a new fridge when you can get a second hand one for the cost of 1 months interest? Given that these forums have seen people claim to have invested their entire savings into P2P on the basis of a 12% return and then be surprised when loans/platforms go bad, I don't think the unfortunate folk who have to resort to this sort of borrowing have a monopoly on thickness …. While I don't find it a particularly endearing business I am prepared to hold my nose.
|
|
paul1
New Member
Posts: 1
Likes: 7
|
Post by paul1 on Apr 11, 2020 18:04:51 GMT
It's interesting that pretty much everyone here has referred to the business model of this borrower as if it were lending, even though we all realise that it has structured its offer to customers as renting. I wonder if the FCA or the courts will see it that way.
For the customer this is the worst of all possible deals, far worse than BrightHouse: 1. If these were loans then the implicit interest rates would be illegal. That's got to make you worry.
2. Despite that, at the end of the term the customer doesn't own the item, has no idea what the price to continue renting or purchasing the item will be, and is otherwise contractually required to return the item at their own expense... Anyone any idea how Mrs. Grady the old lady is going to post her washing machine back? Or how much it will cost her? You can be sure Mrs. Grady doesn't. That's got to make you worry.
3. The insurance they are 'offering' their customers is in effect compulsory as they demand that customers prove they have a policy which covers the product for breakdown or accidental damage and approximately none of these customers will have such an alternate policy. That's got to make you worry.
4. A significant proportion of the kind of customers who have to resort to a supplier like this will struggle, and eventually fail to pay, any guesses how gentle and caring their collections policy will be? That's got to make you worry.
The smart money would have to be on this borrower suffering reputational damage at the least, and very possibly regulatory attention.
I'm afraid it's a no from me.
|
|
p2pfan
Member of DD Central
Full-Time Investor
Posts: 739
Likes: 830
|
Post by p2pfan on Apr 17, 2020 10:55:53 GMT
The situation with this business enabling people to enjoy white goods and the like at higher interest rates than others charge is little different to it and other companies borrowing money from lenders via Ablrate at much higher rates than is available from other lenders.
Why are these companies borrowing from Ablrate lenders? Because they simply can't from elsewhere at lower rates. It could be for a variety of reasons: they don't have the track-record, they don't have the solid collateral, basically their risk profile is high.
Same with the borrowers using this business.
I know such sectors and their inner-workings well. While I have no doubt that many such companies may have some dubious practices and anything of that nature should be called, it's naive to think they are simply greedy profiteers and laughing all the way to the bank with substantial profits. As the previous poster mentions, a very high ratio of their debtors typically do not pay their bills.
When they have money in their pockets, many of these people don't prioritise paying their long-overdue bills but prefer to spend their money, apart from on some of life's essentials, on cigarettes, illegal drugs, tattoos, fancy mobile phones and the like. (I don't say this sitting from an ivory tower but from having lived cheek-by-jowl with such folk on a council estate for 23 years.)
That's why other lenders do not want to lend to them.
Therefore a huge amount of administrative resources are required to write them letters, emails and to ring them etc. to chase up their non-payments. Even then, in many cases it'll be impossible to get a penny from them.
It's why - putting aside the regulators clamping down on them - a significant number of payday loans lenders went bust several years ago. They were making losses. Despite their high interest rates they weren't able to make a return because of the extraordinarily high ratio of borrowers who were not paying their monthly interest.
I'm glad so many of the people who think this company is charging too much will be lending their own money to borrowers with the same risk profile at much lower rates than the company. It demonstrates they don't just attack a company on a forum but take action to back up their words...
... and I'm glad that henceforth you'll also be voluntarily lending to Ablrate borrowers at half the current rates to align your lending with interest rates charged by some other sources.
|
|
ilmoro
Member of DD Central
'Wondering which of the bu***rs to blame, and watching for pigs on the wing.' - Pink Floyd
Posts: 10,848
Likes: 11,077
|
Post by ilmoro on Apr 17, 2020 10:59:30 GMT
|
|
hendragon
Member of DD Central
Posts: 631
Likes: 619
|
Post by hendragon on Apr 17, 2020 11:11:37 GMT
this does seem to be a similar business model to Brighthouse high street chain. That did not end well.
|
|