They were screwed out of their money because, as a result of their poverty, they had to pay something like five times what their shitty furniture was worth. They had no other way to get furniture.
They have kids. They want to provide a home for them. Who wouldn’t? And I’m not going to look down on them because they chose to replace a sofa with “wiring poking through the bottom, cutting gashes into the living room floor.” The father is a working man – a truck driver – and it’s a shame that real work doesn’t pay enough to make a home for one’s family anymore.
That’s basically what I was coming to say- unless it’s an immediate necessity, it’s patently dumb to do something like the person in the article did and buy furniture at a rent-to-own place.
If you can afford that payment, you clearly have the cash flow to save that same amount monthly as well, and you could do without until you can buy it outright, which would save you more in the long run and be more secure as well. But I doubt the people in the articles are really equipped mentally to figure that out or have the discipline to actually save that amount week-in and week-out. Hell, they went for some sort of rent-to-own scam; that seems like prima facie evidence that they’re not good at this sort of math.
I’m not faulting the companies for their pricing schemes; they’re charging high interest because these people are high-risk, and the terms are to keep the monthly payments low as well. If you go try and buy a car with cruddy credit and decide you only want to pay $200/month, you’re going to be in much the same situation as that dumbass who bought the love seat, with the only difference being that you have a new car, instead of some mundane workaday home furnishings for your usurious loan.
Why couldn’t they have saved some lesser amount of cash and picked up a used love seat or couch? I think we either had hand-me-downs or bought used stuff from other people when I was a kid, and it didn’t hurt us any.
I’ll say this- I think there should be clear language both on the showroom floor and the contract paperwork showing the total financed amount and the unfinanced price, so that it’s clear to the person buying it that they’re going to pay 3x the price if they go the crap finance route. Expecting someone without much education to work out the terms of a loan like that is a bit much on the spot.
Cite? Specifically, cite for the proposition that a substantial number of low-income people are low-income because they spend too much money. That sounds like a condescending myth to me.
Most low-income people do not have the skills or experience to get a higher-paying job. They lack these skills and experience for a whole range of issues, but I doubt even a double-digit percentage lacks them because of over-spending.
I find it hard to believe that “lots” of people don’t understand that simple concept.
So, in your view, people who are deemed high-risk should not be afforded the opportunity to purchase things on credit? What would be your plan to enable them to purchase things? They obviously can’t just save money on their own, or else they would have been doing it already.
Oh b.s., there are plenty of cheap (or even free) sofas on craigslist, and thrift stores often have decent ones for under $100. This lady insisted on getting a luxury set that “matched the colors” of her doublewide trailer. :smack:
I was thinking of the capacity for discipline and deferred gratification. This manifests itself both as irresponsible budgeters and spenders and also as the unwillingness to knuckle down and spend the time and toil creating skills that will only pay off years down the line.
They are closely related, so I was thinking of them along the same lines, but you’re correct that it’s not all about spending specifically.
This is definitely one of those mixed feelings issues. On the one hand these stores are engaging in clear predatory behavior. On the other, hand, people could make better choices,l earn to persevere and do without until they’re in a better position to afford certain items.
Also, you seem to be confusing “low-income” with “poor”. You can certainly be earning a decent salary and still be poor if you make enough bad decisions. And, as I recall from my graduate student days, “low income” doesn’t necessarily mean “poor”.
Oh get your panties unbunched already. She’s spending money she can’t afford buying and eating so much extra food that she’s become obese - another example of making bad choices. The obesity then results in other negative consequences, like diabetes, and these together in turn cause poor employability. All examples of making bad choices, but they are HER choices. She’s not a “victim”.
Of course there are plenty of poor white people. But nobody gives a shit about them because they don’t get to yell racism.
Is perfectly legal in states where these businisses exist.
Of course I did. Because if these businesses did the right thing and not lend to the desperatley poor then people would complain. And when a minority complained they were denied a loan the story would get turned into that the business is racist. And then Al Sharpton and Jesse Jackson would be all over the news claiming racism. And there would be a pit thread about these evil racist business owners.
Yet when money is involved people don’t a give shit if it’s right or wrong. Hence these businesses. Don’t like it then change the laws.
If your business model is to sell stuff on credit at interest rates that would be instantly obvious as a rip-off to anyone with the ability to multiply, then you’re a scumbag.
Because, since your business model is a scam to anyone who can multiply, it’s obvious that your only customers are people without the ability to multiply. Your business is ripping off people who don’t know better. And I can easily prove they don’t know better, my evidence is that they bought your fucking product.
Any product that a person of normal intelligence would identify as a scam IS A SCAM. Yes, it’s a scam only idiots would fall for. THAT’S THE FUCKING POINT. Your business model is to trick stupid people out of their money. That makes you a scumbag.
The only good thing about these rent-to-own and check-cashing and payday loan places is that they’ve put mom and pop loansharks out of business. A poor person who needs a loan nowadays would never visit Vinnie on the streetcorner, they just head straight for the payday loan office.
Pay them more? Perhaps through a higher minimum wage, accessible job training/public transportation, or a negative income tax?
I guess the question that comes to me is - are there certain commercial transactions that are so egregiously unfair (as in, there is no reasonable justification for one side of the transaction to knowingly enter into it) that they should be banned? And, if so, do high-interest rent-to-own arrangements of low- to moderate-cost “luxury” goods fall in that category?
So the alternative is to bring back the streetcorner loan shark?
Some people will make poor choices or face unfortunate circumstances and be unable to make the payments. The solution is to what, forbid people who can make the payments the opportunity to acquire consumer goods?
If these places don’t exist, then these swathes of the population are now unable to acquire goods by other means. Is that a success?