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4/09/2010

270% interest rate per annum

A blogger asked me for my view on the 270% interest rate that was raised by a forumer in the ST forum. The writer said that this is a possibility provided by the Money Lenders Act. I did not pay too much attention to such numbers as I have been desensitised by the greed in the financial system, where exploitation for quick profit is now seen as a merit and deserving great rewards. But since I was asked, I took the question to the cesspit for a little discussion. The PhD holders in the cesspit thinktank, all bought of course, were very adept in this kind of issue. They have all made their millions doing the same thing, and their only conscience is their own pockets. So what would they say? No issue at all, all corners are covered. In the first place it is legal. Period. Anything that is legal is legal, faultless and blameless. Only those who do not know how to exploit the legal road would kpkb about such things. The beneficiary will just laugh their way to the banks. The next point is that it is completely transparent. The fine prints are made known to the borrower, and the seller representatives were well trained to tell the borrower all the risk involved. No cheating, no undisclosed information, no misrepresentation. This leads to the third point. Willing buyer and willing seller. No one is being forced to take the loan. And yes, this is covered under caveat emptor. And this is a legit business. Business means making profit. The higher the profit the better the business. And this is good for the economy as well. How else could people make so much money to buy so many million dollar properties? The whole thing generates wealth and a vibrant economy. These are what the cesspit thinkers came out with and all very reasonable, logical, legitimate. I am quite surprise that they could think so clearly. So where is the problem? No problem at all. In all business transactions, there must be the suckers and the big winners. Somehow I feel so nice reporting their findings. I think I have been infected by the E1U1 flu bug. Maybe a few more practices I can start to apply to join the Elite and Uncaring class.

7 comments:

Robert Tan said...

Aiyoh, why are these people borrowing from someone who charges 270%? Maybe they are not so good in their maths, desperate or what?

Should either:

1) borrow from credit card company, only 24% (sure looks cheap compared to 270%);

2) better still, borrow from bank/finance company,. Rates vary, depending on various types of loan, duration, credit worthiness(unless track-record of borrower so bad that got blacklisted) etc, but, should be less than 24%;

3) if buy hdb flat, borrow from hdb;

4) borrow from family/friends, assuming they have the money and willing to take default risk;

5) or maybe, if don't know how to manage money well, don't borrow at all. Save long, long, then buy. If after save long, long, still can't afford, maybe have to adjust wants/needss;and

6) if all else fails and in real dire need of money, go and test out whether all the government and other privately funded social safety nets that are supposed to be available to help the destitute and desperate are really working.

7) At all costs, avoid loan sharks. Sure more than 270% - but then, some may want to use those same points that have been listed down by the PhD holders to justify loansharking, except maybe the part about legality and informing the borrower about risks.

Wally Buffet said...

What's the REAL difference between the loan sharks and the "legitimate" moneylenders?

Zilch.

What's the REAL difference between the plushy casinos and the backlane gaming stalls?

Zilch.

What's the REAL difference between state organized gaming and the 4D bookies?

Zilch.

What's the difference between gaming, gambling, casinos, loansharking, money lending et al?

Semantics.

Anonymous said...

This is no daylight robbery, mind You, the Reporting in the Straits Times shows that everything is lawful and of course it has to be approved before it becomes legal.

Btw, the Straits Times carries much of these loan and financing advertisements of which many state very low attractive rates. A friend recently just told me he almost got himself into trouble, luckily he was sane enough to prevent himself from being misled.

SINLand feels like the Kalahari Natural Park where the wild and ferocious take all. The Lions there do not lead the sheep, they eat them up or frolick them when they are full.

Anonymous said...

Right. What's the difference between legal and illegal 4D. It's still gambling.

Hehe, What's the difference between legalised and illegal corruption? Just a matter of changing the law, right?

I think we have seen enough.

agongkia said...

Whether loan from bank,credit card cash advance,licensed money lenders,Ah long all the same one.Some tell you 24 % but if you use the facility,it will end up many times more,if you have difficulty to pay in time.The MSM reported recently that licensed money lenders are more willing to lend to those HDB sellers.Flyers start coming in and when you try to call them up ,it will likely turn up to be a money lender cum property agent towkay.They will tell you they charge 15%only,very reasonable compare to others.But the 15%is per month ,not per annum.Beware,you may even have to sell your flat through them to qualify if you tend to take up the loan.And Dun think you can get a good price if you do so.The earlier they sell the earlier they get paid,so they can chin chai sell.I am more concern by those poor flat owners who have no other way out and is misled .The best is not to borrow...but who am I to say that?cos .....paiseh...whoever you mentioned,I had borrowed except that property agent cum money lender.Hoohoo.what to do?who ask me to be poor?

agongkia said...

and Mr Robert Tan
1)Borrowing from credit card should be not be encourage.
4)borrow from family/friends..talk about this I very paiseh...
6)Dun depend too much on garmen
7)Avoid loan sharks.Strongly Agree but rate not necessary more than 270%.Can be better than the licensed one.I can't reveal here.Some more no need IC .But never never borrow !

I wonder whether we can apply for ourselves to be bar from borrowing from any institution like how we apply for ourselves to be bar from the casino....hehehe..

Chua Chin Leng aka redbean said...

Hi agongkia, welcome to the blog. The authority has replied that safeguards are in place and there is a need for such money lenders.

And so far so good. Only 18% pa.

Have no fear.