Why We Are NOT “Loan Sharks”
When I tell people where I work, the next question they usually ask is “So what do you do all day?” And the answer is that I process loan applications, evaluate vehicles that would be used as collateral, take loan payments, and make debt collection calls for people who are late. From there, the conversation usually goes toward “Oh, so you reposess people’s cars like on that TV show, huh?” or “Oh, you’re one of them!” (referring to bill collectors). It is also possible that a person might be low on money and they become interested in what rates we charge. And when they find out that rate, most of the time they react as if their hat literally was blown off their head.
C’mon people. Stop with the “loan shark” name-calling. We aren’t crooks. Well, let me explain…
First of all, what is a loan shark? The term shark is used because sharks are known to be dangerous and deadly. And yes, if handled irresponsibly, borrowing money can kill your credit. But no one is holding a gun to our customers’s heads making them sign paperwork. I have come up with five solid reasons as to why we are not “crooks” as we are so often called.
- Our customers are HIGH RISK. Most of the time, they have bad credit. This is a great big red flag. This says to the lender, this person is irresponsible and they pay late or only pay the minimum to get by. A lot of our customers are unstable and usually move around alot, hiding from friends and companies to whom they owe money. Also, these people usually have low income and have little to no assets. Would you want to lend a large amount of your own money to someone who is high risk for hiding and paying late? This is the reason we have a high service charge rate (high in comparison to banks and other financial lenders). With a high rate, customers are encouraged to pay as much as they can as soon as they can to save themselves as much money as they can, instead of only paying towards interest and not bringing down their principal balances.
- We aren’t “crooks” because we, as the processors of the loans, do not make any commission off of a loan we give out. It doesn’t matter whether I write your check for $25.00 or for $3,000.00. We only get paid hourly. There are no hidden motives.
- We aren’t “evil.” It is NOT our goal to reposess vehicles (keep in mind, I’m only speaking for the company I work for). We are not in the car-selling business. We do loans. And actually, when our office has to handle car sales, it takes away from our main objectives — which are loan processing and debt collecting! We do not want our customers’s cars and we will work with them to keep their vehicle. Customers need their cars to get to work, pick up kids from school, and run errands. It isn’t our goal to take this away from them.
- We give our customers ample time and opportunity to inform us of an emergency situation that will cause them to be late making a payment. Other title pawn companies are less lenient than us and make threats to their borrowers. We give ours time to let us know what is going on so we can figure out a solution for them. If a customer does not inform us after several attempts to contact them or we feel as if they are trying to flee, we then have no other choice but to assume they have little to no intention of paying. But we at least make many phone calls and send a couple letters before deciding that we are going to take further action on them (repossession, filing a writ, going to court, etc.). We do everything we can in the office before deciding to take a legal step against them. We also NEVER threaten them and we are always honest and upfront with our intentions.
- Lastly, we do everything we can to make sure our customers do not leave our office without FULLY understanding what they are doing. We explain the full application process as well as the payment process in detail with the customer before we start anything, especially if they are unfamiliar with title pawns. We read the paperwork to them, emphasize on all the most important details, and ask them if they have any questions before we give them the paperwork to review and sign. But it is very often where the customer is in a rush to leave and go back to work or to pay a bill, so they aren’t listening avidly and rush to sign everything. This is why we make a copy of their paperwork with all the important areas high-lighted for them. And usually when they get home for the day, they can look over it and call us back if they have any questions about it. If they come back before the day is over and decide they want to void the contract. They can give us back our money and we will delete their account.
You see, we aren’t loan sharks. The customer is in TOTAL control. They have the freedom to come to us, they have the freedom to ask us questions, they have the freedom to leave the office if they are unsatisfied with our rates and policies, and they have the freedom to go try their luck at other lending companies. Once they sign the paperwork with us, the customer then has the freedom to either pay early, on time, or late, to pay only the minimum or pay over.
There are no fine print or ball-and-chain in our business.