Promissory Note with Security Interest
{"Image DocumentName": "Promissory Note with Security Interest", "Image ImageDescription": "TOO EASY LOAN COMPANY. Promissory Note with Security Interest. Security: 1996 Olds Ciera. Annual Percentage Rate. The cost of your credit as a yearly rate. 300% Finance Charge. The dollar amount the credit will cost you.  4, Amount Financed. The amount of credit provided to you or on your behalf.   Total of Payments. The amount you will have paid after you have made all payments as scheduled.  6, % per month. Payment Schedule: 12 Payments of   Beginning 2/4/99 and on the 4th of each month thereafter until final payment is made on January 4, Default Charge: If the payment is late 10 days, you will be charged 5% of the payment amount. This is an example of an actual loan made in Utah (the name of the lender was changed, but the data is taken from an actual loan). Notice the APR (300%). Moron Math Quiz: Which is higher, the unlucky 13% mentioned earlier or 300%? It doesn\u2019t take complicated math to realize, this rate is extremely high! Notice this loan is secured by a 1996 Oldsmobile, which was worth about  10,000 at this loan was made. If this borrower had missed a payment, the lender would have repossessed the car. He shouldn\u2019t lose all of his  8000 of equity, but I would not trust such a company with disposing of my collateral in a commercially reasonable manner . Utah law doesn\u2019t have an interest rate ceiling, but we do have an unconscionability provision . Since the law doesn\u2019t define unconscionable , a judge must decide. If this borrower takes this lender to court, the judge would very likely rule this loan unconscionable, and most of the interest paid would be refunded. However, very few borrowers who use this type of loan have the know-how or desire to take legal action. Another problem we are facing with this type of lender is that many of them, when asked the cost of their loans speak of a monthly rate rather than the Annual Percentage Rate (APR), the standard of comparison set by the Fed. Why? Because 25% doesn\u2019t sound as bad as 300%.", "Image XResolution": "37", "Image YResolution": "37", "Image ResolutionUnit": "Pixels/Centimeter", "Image Software": "SlidePlayer", "Image YCbCrPositioning": "Centered"}