Sears was charging a rate of 26% interest rate, maybe that's fine and legal, but they made up for it with all kinds of service charges. On a $2,000 dollar bill, if I sent in a min. payment of $50. , only $2. would go to the principal, the rest went to service charges. At that rate I would be paying for the rest of my life, I stopped paying altogether, now my credit is all messed up. Was what they were doing legal?
2007-07-04 15:33:13 · 2 answers · asked by Anonymous in Business & Finance ➔ Personal Finance
http://www.lectlaw.com/files/ban02.htm lists the usury rates which vary by state. Since you don't say what state you are in, they might be legally charging you 26%. They have to disclose to you what your loan rate is and fees will be on top of that and sometimes the rate is applied to fees if I'm not mistaken. Are you sure that's what your rate was as stated on your bill? Also, if you make a payment late, fees are charged first and those can go upwards of $30 or more per late monthly payment. That's more than half your $50 payment. And stopping payment altogether will definitely mess up your credit!
2007-07-04 16:23:55 · answer #1 · answered by saurus3118 5 · 1⤊ 0⤋
There was a time you were protected by usury law. No longer.
What you did was wrong. Find an alternative lender, pay off the bill (with a lower finance charge). Don't mess with your credit score.
2007-07-04 23:55:57 · answer #2 · answered by Common Sense 7 · 1⤊ 0⤋