79% Interest Rate

[KUlawJack]

Re: 79% Interest Rate

You know better than that, KUlawJack. A typical banking relationship is not adversarial. If it becomes adversarial, quit banking at that bank and let that bank go down the sewer (and the scoundrels running the place be damned!! ).

In the law, the relationship of a bank to its customer is one of a debtor and creditor relationship with each party to the relationship charged with looking out for its own interests. Sometimes the bank is the creditor and the customer is the debtor (e.g. bank makes a loan to the customer) and sometimes the customer is the creditor and the bank is the debtor (savings account, certificate of deposit).

In the usual and customary banking relationship, there is no fidcuciary relationship. However, there are specific cases in which courts have found that due to particular circumstances, a bank may have a fiduciary relationship with the customer (KUlawJack...look up Brandriet v Norwest on Westlaw for the SD case on that proposition...I am very familiar with that one). If a fiduciary relationship is established, then the bank may owe a higher duty to the customer and the bank may be required in the law to look out for the customer's interests. Banks readily accept acting as a fiduciary in some situations (e.g. when serving as a trustee) but normally when they act as a fidcuciary, they only want to do that we've they've agreed to accept the duties of a fiduciary. In most situations the bank should avoid having a fiduciary relationship but when things go bad, some people will claim the bank had a fiduciary duty to the customer.

Now, the above points are not intended to address whether we think banks are nice etc. But, it's too bad the true relationship is not better understood. People have to take responsibility and watch out for their interests when banking just like they should when they're buying lumber at the lumberyard and groceries at the grocery store. A successful bank provides excellent service to its customers even though there is a debtor and creditor relationship.

Banking relationships become adversarial when one party to the relationship does not do what they agreed to do. For example, borrower fails to make mortgage payments. If someone feels their relationship with their bank is adversarial, quit that bank immediately and go to a different bank.

I guess I wasn't speaking of "adversarial" as a legal term of art. Poor choice of words on my part as I wasn't trying to raise the issue as a legal matter and know better than to address an issue in depth without some basis of knowledge. I was just making the point that, generally, a lot of people that have gotten in trouble with loans in the recent sub-prime lending fiasco didn't educate themselves regarding their duties or the nature of the lender's duties. Many didn't realize that the lender is not going to step outside of their own role to coddle the lendee or hold their hand through any of the process to ensure that the lendee really knows what they are doing. I think the significant number of foreclosures nationwide demonstrates this exact situation. Obviously, there are other factors that play into this situation, but this is definitely one of the leading causes, which when coupled with predatory lending practices may result in some people's jaded view of our current banking environment. No one's hands are clean. I am not saying all banks engage in improper practices or anything either because that's obviously not true.

I made a blanket generalized statement assuming it was a throw-away. Didn't mean to create any legal issue or pretend to be speaking to any legal matter. Law school is a lot like self-defense training during basic training - the drill sergeants told us that they taught us just enough so that we would still get our butts kicked when we went home and tried to use any of those moves in a bar. I don't hold myself out as knowledgeable on banking law. Haven't taken a course on it. I didn't enjoy Article 9 much either!

What were we talking about anyway? Oh, a credit card. Wow, thread drift. I don't have a credit card. I also don't plan to get one anytime soon.

[Nidaros]

Re: 79% Interest Rate

You know better than that, KUlawJack. A typical banking relationship is not adversarial. If it becomes adversarial, quit banking at that bank and let that bank go down the sewer (and the scoundrels running the place be damned!! ).

In the law, the relationship of a bank to its customer is one of a debtor and creditor relationship with each party to the relationship charged with looking out for its own interests. Sometimes the bank is the creditor and the customer is the debtor (e.g. bank makes a loan to the customer) and sometimes the customer is the creditor and the bank is the debtor (savings account, certificate of deposit).

In the usual and customary banking relationship, there is no fidcuciary relationship. However, there are specific cases in which courts have found that due to particular circumstances, a bank may have a fiduciary relationship with the customer (KUlawJack...look up Brandriet v Norwest on Westlaw for the SD case on that proposition...I am very familiar with that one). If a fiduciary relationship is established, then the bank may owe a higher duty to the customer and the bank may be required in the law to look out for the customer's interests. Banks readily accept acting as a fiduciary in some situations (e.g. when serving as a trustee) but normally when they act as a fidcuciary, they only want to do that we've they've agreed to accept the duties of a fiduciary. In most situations the bank should avoid having a fiduciary relationship but when things go bad, some people will claim the bank had a fiduciary duty to the customer.

Now, the above points are not intended to address whether we think banks are nice etc. But, it's too bad the true relationship is not better understood. People have to take responsibility and watch out for their interests when banking just like they should when they're buying lumber at the lumberyard and groceries at the grocery store. A successful bank provides excellent service to its customers even though there is a debtor and creditor relationship.

Banking relationships become adversarial when one party to the relationship does not do what they agreed to do. For example, borrower fails to make mortgage payments. If someone feels their relationship with their bank is adversarial, quit that bank immediately and go to a different bank.

This is just beautifully put and you attorney folks are great wordsmiths and now I know why I never tried to gain admittance to law school and also realize why I sat several times for the Business law section of the CPA exam before finally passing it. These concepts are often hard to put into words that are meaningful to the person reading and grading your exam. JD is absolutely correct and complete in this post.

I see where KU is coming from though as I think you could find in study of European History a correlation between usury and a rise in anti-semitism. This is not to pass judgement on T Denny nor the state of South Dakota, but back to the first post, 79% APR? Run the other way. and make good choices when spending your disposable income

[Jacks#1Fan]

Re: 79% Interest Rate

This is not to pass judgement on T Denny nor the state of South Dakota, but back to the first post, 79% APR? Run the other way. and make good choices when spending your disposable income

Who wouldn't run the other way from paying 79%...if they have money, or credit. But some people screw up their lives, and then want to unscrew it. When you've got a really bad trail of decisions, try righting the ship by going to a bank or normal bank credit card. Premier's card is an option that doesn't exist otherwise...if it didn't serve a need, it wouldn't exist. Who in the heck want's to pay 18 or 20% like a lot of credit cards charge...only those who want to spend more than they can afford to spend. Given all that, I completely disagree with the posters who castigate Sanford for making SOME of his money off high interest rate (read that HIGH RISK) cards for people who want and need the availability of rebuilding their credit.

[Jacks99]

Re: 79% Interest Rate

When you've got a really bad trail of decisions, try righting the ship by going to a bank or normal bank credit card.

You can't get out of Debt with Credit and building your "I love debt" score doesn't either.

Save, spend to a plan and dig your way out.

[Nidaros]

Re: 79% Interest Rate

Who wouldn't run the other way from paying 79%...if they have money, or credit. But some people screw up their lives, and then want to unscrew it. When you've got a really bad trail of decisions, try righting the ship by going to a bank or normal bank credit card. Premier's card is an option that doesn't exist otherwise...if it didn't serve a need, it wouldn't exist. Who in the heck want's to pay 18 or 20% like a lot of credit cards charge...only those who want to spend more than they can afford to spend. Given all that, I completely disagree with the posters who castigate Sanford for making SOME of his money off high interest rate (read that HIGH RISK) cards for people who want and need the availability of rebuilding their credit.

I suppose I have problems with every wealthy person. They are wealthy and I am not, and that is the problem.

Just think would Augustana have its new football staduim if that donor's father had not made money rendering dead animals aka Sioux Falls Rendering CO?. I guess he performed a valuable service as living on a farm as I recall, dead animals were something you did not let lie for too long. My point is there are many ways to become wealthy. You do have to provide a good or service and that does not exclude T Denny.

I am just finishing a book by Niall Fergussen called the Ascent of Money. Its been out about a year. Fergusson mentions that about 1100 or 1200, the Chrisitian Church believe charging interest was a sin. Therefore those who had need to borrow went to people of the Jewish faith, and all these anti-semitic feeling about Jewish people relating to usury and interest stem back that far and to that source of economic activity.

[filbert]

Re: 79% Interest Rate

I suppose I have problems with every wealthy person. They are wealthy and I am not, and that is the problem.

Envy is one of the Seven Deadly Sins, you know . . . of course, greed is too (referring to the rich folk, assuming they're greedy of course) . . .

[Nidaros]

Re: 79% Interest Rate

Envy is one of the Seven Deadly Sins, you know . . . of course, greed is too (referring to the rich folk, assuming they're greedy of course) . . .

I forgot to put the green smiley at the end of my statement. I got pretty much all I need in life so not really bothered too much with envy. In fact there are people who I would not want to be in their shoes. IE Coach Nagy.