Western Sky problem solver loan will make you beg for mercy

Government protection is often too little and too late. Victims of predatory lenders like Western Sky and its affiliates can only regret their decisions to take out loans with ridiculous and usurious terms. The “Problem Solver Loan” is no different.

Accepting a $10,000 loan with a 89.68% APR interest rate would be considered by most educated people to be insane. If you accept such a loan, you must understand that you have nearly a zero percent chance of repaying that loan according to their terms. Here is what you consent to:

You will have to make 84 monthly payments of $743.49. Your $10,000 loan (you actually only get $9,925) would cost you $62,453. If you fail to repay the loan, the lender will pursue a judgment against you and wage garnishment using a tribal court where you likely cannot travel to to contest the legal action.

Are you really willing to repay $62 Grand in exchange for a measly 10? If so, then you are an idiot and you are responsible for your own financial failures. If that statement upsets you, then you should take a close look at your financial decisions up to this point, and how they have contributed to your current weak financial condition.

All insults aside, the fact that you are at this page is confirmation that you are smarter than the average victim and are actually researching the negative consequences of taking out the Problem Solver Loan or any other predatory loan product. You would probably be interested to know what the interest payments are on this type of loan.

You may expect to pay a relatively high amount of interest in the early months on an installment loan product, but the amounts paid on this loan are staggering. Your first monthly payment of $743.49 would only apply $1.75 in princpal. The other $741.74 would be interest, bringing your $9,925 original balance (remember the first $75 is another fee) down to $9,923.25. You cannot even buy a Big Mac with the amount paid towards principal in the first month.

The same loan with the effective rate of my home mortgage would only require a $132.87 monthly payment for the same 84 months. Compare the difference between the rates:

Problem Solver Loan My home mortgage*
Interest Rate 89.68% APR 3.385% APR
Term 84 months 84 months
Monthly Payment $743.49 $132.87
First Principal Payment $1.75 $104.87
First Interest Payment $741.74 $28

* Home mortgage term and principal have been adjusted to match those of the problem solver loan for comparison purposes.

Victims rarely understand the interest costs of a high APR loan, but they do understand monthly payments. Would you prefer a $743.49 monthly payment or a $132.87 monthly payment?

When you have income and credit challenges, then you may be subject to a higher interest rate. Still, even the highway robbery rates charged by consumer finance agencies of 25% or more would still only result in a monthly payment of $251.22, which is only about a third the required monthly payment charged by Western Sky partners.

Those who understand the costs and still go through with it are either deranged, total idiots or terminally ill with no intention of ever repaying the loans. Otherwise, there are much better options than Western Sky’s Problem Solver Loan.

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