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How you are TRAPPED in PAYDAY/Salary advance, emergency/ TITLE LOANS and how you can get out of it - YouTube
Channel: George King'ori
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hello ladies and gentlemen welcome to my聽
channel if it is your first time to come聽聽
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welcome we here we talk about all things finance聽
and how we can be able to help each other grow聽聽
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financially i am here to educate and to elevate聽
you into greater levels financially so today we're聽聽
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going to speak about um short-term consumer loans聽
or the payday loans um and and why so many people聽聽
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are trapped into these debts so ladies and聽
gentlemen it is important to note that the reason聽聽
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why this paid old payday loans have continuously聽
increased in popularity is because more and more聽聽
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people especially the low income people in聽
the low income levels are not able to access聽聽
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good credit facilities from the banks聽
either on time based on their need or聽聽
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because of their bad credit so it is important聽
to note that is why they are growing they聽聽
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are filling a market that is not filled by the聽
traditional lenders again it is also important聽聽
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to note that there are people who have found a聽
space to be able to invest the additional funds聽聽
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and be able to increase their their rate of in or聽
of of of return again it is important to note that聽聽
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the people who invest in these paid day loans and聽
these lenders make the highest possible profit聽聽
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ladies and gentlemen these things are profitable聽
to the investors extremely profitable some make聽聽
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as much as 75 percent per annum and some聽
have been hard to even make up to 100聽聽
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per annum on investment why because people are聽
charged exhausted fees so one of the reasons why聽聽
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our people are so trapped into this credit card聽
debt is because they promise a quick turnaround聽聽
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so they give you readily accessible funds with聽
less bureaucratic tendency as the ones that聽聽
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we see with the banks and they are able to to to聽
give you these funds within a short period of time聽聽
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and uh they do not take too much time聽
to evaluate the lenders that they give聽聽
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they are also available uh uh even in odd times聽
and in all days when the normal banks are closed聽聽
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so they are readily available and they are readily聽
accessible to the people who need them but now the聽聽
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challenge is uh and that is what makes people get聽
trapped in this kind of companies is because one聽聽
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the kind of loans that they give are short-term聽
loans consumer loans those are the loans that聽聽
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you take to be able to feed your family to be聽
able to pay and to be able to do this and that聽聽
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now the challenge is in that these kind of聽
expenses in car inca are in card and recur聽聽
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each and every month so if you take a loan to pay聽
for your rent this month you will still need to聽聽
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pay for your rent next month so you find that you聽
are constantly in need now the challenge comes in聽聽
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that some of these loans are high interest loans聽
they charge as high as seven percent per month聽聽
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ladies and gentlemen this is high interest聽
loans this seven percent translate around聽聽
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84 percent per annum now the thing聽
that they do not tell you is that you聽聽
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even if you pay the minimum amount聽
they ask for so you go for refinancing聽聽
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they change the terms based as if it's a new聽
loan so one you incur a penalty for non-payment聽聽
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on their great time and then your rate of聽
interest goes up so at the end of the day聽聽
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because it is a consumer loan and because you聽
need to continue bridging and paying your expenses聽聽
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you find that you kind of find yourself聽
refinancing your loan every month every month聽聽
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so you turn over your loan continuously so if聽
you began with an interest rate of seven percent聽聽
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the first month and you are able to pay completely聽
so you take an additional loan to pay off the聽聽
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previous loan and take on a new loan you find聽
that the next loan you pay with say eight percent聽聽
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again with the penalty of not paying on time and聽
then you find the following month you incur nine聽聽
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percent so it continues adding and adding an ad聽
and becomes a sustainable attitude at some point聽聽
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ladies and gentlemen that is how you聽
are trapped by these short-term loans聽聽
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again they tell you no you can choose to have a聽
longer period of time and pay a minimum amount聽聽
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but now the challenges and what they do聽
not tell you is that this kind of schemes聽聽
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do not allow you to pay down your capital so you聽
are paying but you are not getting any better you聽聽
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are paying debt but you are not improving you聽
are constantly uh having to pay more and more聽聽
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so you end up accumulating more debt and more聽
debt and more debt again sometimes they ask you聽聽
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for securities so they ask you give us your car聽
so your car is valued at five thousand dollars聽聽
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give us your car give us the title of your聽
car your car is valued at five thousand聽聽
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they will not give you a loan of five thousand聽
they will give you a loan of two thousand聽聽
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because they know that when you struggle and聽
your debt continues to grow and grow it will聽聽
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come to that five thousand and when they聽
come to recover the car they'll be able to聽聽
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recover the capital they gave you and the聽
interest that it has incurred up to that聽聽
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point ladies and gentlemen it what it is one of聽
the quickest way to poverty these payday loans聽聽
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they do not tell you but it is the quickest聽
way to poverty it is the most lucrative way聽聽
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for investors to make funds they make so much聽
money in fact it is one of the most profitable聽聽
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it is only borderline to illegality because聽
in many states it's not illegal to lend
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but it is highly immoral and it is giving these聽
investors so much money but at the cost of the聽聽
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poorest people in society so a study was done a聽
while back on this payday loans and it was found聽聽
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that the towns that had the highest number of paid聽
day loan lenders had the highest poverty rates聽聽
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so ladies and gentlemen this is not finance聽
this is a ticket to poverty and the easiest聽聽
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way to be able to get out of short-term loans or聽
short-term consumer loans is to be able to get聽聽
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another loan that you can be able to get from聽
a traditional lender or a bank or pay or sell聽聽
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a car or sell something and pay completely the聽
debt and do not take any additional debt again聽聽
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as the people who work in a company you can聽
be able to talk to your employer talk to your聽聽
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employer as a number of you or as an union and ask聽
your employer for advance on your salaries so you聽聽
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can ask for advanced payments on your salaries聽
so that by the time you are paid your salaries聽聽
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you are able to offset against the advances that聽
you have been advanced for that month so that is聽聽
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the easiest to again if you are an employer the聽
easiest way to be able to get your people out of聽聽
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this debt is to advance monies you can and you are聽
able to you can charge as a small interest or none聽聽
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at all because your desires to benefit the people聽
who are working under you again for the borrowers聽聽
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easiest way to get out of this debt is not to聽
take it in the first sense if you are completely聽聽
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unable to overcome the temptation to borrow then聽
borrow from other means borrow from your friends聽聽
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or your family borrow from your traditional聽
lenders avoid going to these paid day lenders
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avoid especially if it is consumer you're not聽
meeting an emergency thing that you have to聽聽
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pay for now now and imagine somebody host is in a聽
hospital and you need to pay a bill or procedure聽聽
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or something like that if it is not a must for聽
you to have if it's just consumption you need聽聽
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to buy a new phone or do you need to or you need聽
to to pay for food avoid you had rather adjust聽聽
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your expenses and reduce your spending because聽
paid or loans are the easiest way to poverty聽聽
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so ladies and gentlemen i hope this has helped聽
you to be able to understand how they operate聽聽
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and how you can be easily trapped in these payday聽
loans if it is if you have not subscribed to this聽聽
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channel kindly subscribe to the channel like聽
leave a comment get get get to let me know how i聽聽
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can be able to help you and how you can be able to聽
talk on all things finance so thank you and enjoy
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