Small Loan, Big Interest: How One Woman Was Billed More Than Double What She Was Loaned - NBC Southern California
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Small Loan, Big Interest: How One Woman Was Billed More Than Double What She Was Loaned

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    NEWSLETTERS

    Lender Called Predatory After Charging Insane Interest

    One retailer allegedly charges sky-high interests rate after finding a loophole in the law. Randy Mac investigates SNAP financing, on the NBC4 News at 4 Tuesday, Feb. 5, 2019.

    (Published Tuesday, Feb. 5, 2019)

    Need to buy a big ticket item, but don't have the cash?

    Many retailers are offering a financing option instead.

    But consumer advocates say one company offering the financing has found a loophole in the law, that allows them to charge you way too much.

    "I've been a stereo fanatic since I was a kid," said Lisa Perry.

    Unpleasant Wedding Surprise: Porta Potties

    [LA] Unpleasant Wedding Surprise: Porta Potties

    A couple wanted a refund after a wedding venue suddenly dropped a bomb: porta potties would need to be used. Randy Mac had their backs on the NBC4 News at 6 Thursday, Jan. 24, 2019.

    (Published Thursday, Jan. 24, 2019)

    Because of Perry's affinity for fine music machines, she was willing to shell out $1,300 for a stereo system for her car.

    She was offered quick and easy financing through a company called SNAP.

    "They said you're approved for $1,300. Do you wanna do it? And I said yeah," she said.

    Do You Know What You're Getting With Online Prices?

    [LA] Do You Know What You're Getting With Online Prices?

    A man buying a scooter to help his father get around found one for a great price - but after getting an email saying it was out of stock, he saw it online for hundreds more. Randy Mac reports for the NBC4 News at 5 Monday, Jan. 14, 2019.

    (Published Monday, Jan. 14, 2019)

    Perry's purchase was financed through SNAP! finance - a Utah-based company that offers on-the-spot financing at hundreds of retailers - like for furniture, tires and mattress stores.

    The financing is free, minus a small processing fee, ifif you pay off what you owe in 100 days.

    That part is crucial.

    Cars Still Igniting on Fire Safety Advocates Say

    [LA] Cars Still Igniting on Fire Safety Advocates Say

    Safety advocates say car makers have have failed to fix the issue involving fires igniting in some models. Randy Mac reports for the NBC4 News on Thursday, Jan. 10, 2019.

    (Published Thursday, Jan. 10, 2019)

    If you don't, interest kicks in. And Perry was shocked by just how much.

    "They wanted me to pay $2,600...for $1300 worth of equipment. I was like no,'" she said. "Who's going to do that?"

    Perry says the true cost of financing wasn't verbally disclosed when she bought the stereo. But it is disclosed in the contract she signed on a tablet. After 100 days, she agreed to pay the $2,600.

    Bingo Game Shut Down by LAPD

    [LA] Bingo Game Shut Down by LAPD

    Some senior citizens say the Los Angeles Police Department shut down their bingo game. Why would the police care about a bingo game? Randy Mac reports for the NBC4 News on Monday, Jan. 7, 2019.

    (Published Monday, Jan. 7, 2019)

    "It's unfair, it's predatory," said Graciela Aponte of the Center for Responsible Lending.

    Aponte says the interest rate on Perry's financing is about 160 percent. That's illegal in California. So how can Snap! charge that much? Interest rate caps are for loans.

    Snap! calls its financing a lease.

    Man Says Contractor Hired Via Website Wasn't Vetted

    [LA] Man Says Contractor Hired Via Website Wasn't Vetted

    Brett Shannon thought Thumbtack.com would vet contractors, but when he paid thousands for a shaky fence, he was pretty furious. Randy Mac reports for the NBC4 News at 5 Nov. 27, 2018.

    (Published Wednesday, Nov. 28, 2018)

    Aponte calls it a loophole.

    "We've found lenders that find various different ways to evade state interest rate caps. So we think this is one way it's being used to evade our interest rate cap," Aponte said.

    In a statement to the I-Team, Snap! didn't address the issue, instead saying "Snap! Finance offers a variety of flexible financing solutions to give consumers from all credit types the ability to access financing…" It also said it's transparent about its financing "so consumers can make informed decisions."

    What Happens if Your Bag is Lost or Delayed

    [LA] What Happens if Your Bag is Lost or Delayed

    If you check bags at the airport and they’re lost or delayed, you have rights. Randy Mac reports for the NBC4 News at 5 p.m. on Tuesday, Nov. 20, 2018.

    (Published Tuesday, Nov. 20, 2018)

    After NBC4 reached out to Snap! it wiped out Perry's balance. Perry says from now on, she'll only pay with cash. She hopes other consumers learn from her mistake.

    "Don't sign anything unless you know exactly what you're doing," Perry said.

    The Center for Responsible Lending also says if you're offered financing to confirm if it's a lease or loan. You have more protection for loans. However, the interest rates vary depending on the amount you finance.

    E-cigarette Explodes in Purse, Burns Mother and Daughter

    [LA] E-cigarette Explodes in Purse, Burns Mother and Daughter

    A SoCal woman's e-cigarette exploded in her purse and burned her and her daughter. She says its a battery safety nightmare that's gone unregulated for too long. Randy Mac's shares her story and the lawsuit she hopes will change the industry.

    (Published Tuesday, Nov. 20, 2018)

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