What is the History of Finance Companies?

[CoCoChanel]

I can not help wondering how they are allowed to charge these extreme interest rates to make money and no where in all of this is it considered to be illegal. How do they get away with this....I.m just trying to understand it all. Its almost like punishment for anybody who messes up their credit. Since all finance companies have no idea why you may have bad credit, why assume that anybody who has did something wrong. You could have been the victim of identity theft, gotten sick, gotten a divorce and never had a job with only the husband working or any number of things. Why are people punished this way?

[JRScott]

They get away with it because they bribe (lobby) your congressman and senators so that they make it legal.

That's where reform needs to truly begin. It should be a stated flat fee not interest you pay.

Say you need to borrow 200000 dollars for a home.

Just take on 20000 up front, then figure up payments from that. So you'd owe total of 220000. That would be a 611.11 payment for 30 years that doesn't balloon or change. The current system is designed to squeeze as much from the middle and poor classes as they can through usury.

[Overmylimit]

Also we live in a free enterprise system so when you go into business you can charge whatever you want really, until the Goverment steps in to regulate. In my business I could charge 10 times more than I do, but I wouldn't have any customers. The buyer can just choose to do business with someone else.