My husband was involved in an accident on the job and severely broke his ankle.  He was out of work for three months due to the fact that he had to have surgery.  We were trying to make ends meet with workers compensation and my part-time job.  Things were beyond tight and bills were not being paid.  Then, like an answer to a prayer, an unsolicited loan check came in the mail in the amount of $7,000.22 issued by Beneficial Utah Inc.  The check was cashed so we could save our home and feed our three small children. 

 Prior to making our first payment, we recieved a letter in the mail from Beneficial telling us to contact them, they had great news and would like to discuss various financial solutions to meet my financial needs.  Due to the fact that the current interest was 29.9% we met with them and they lowered our interest to 25.8%.  Which I found out later that it took our principal from $7,000.22 to $7,999.65.  I made five payments to them in the amount of $238.95 totalling $1,194.75.  In June 2005, I was contacted by them again, they offered me a credit limit of $9,000 under a revolving loan agreement.  They didn't inform me of the fact that if I agreed to this my interest rate would go up to 28.9% or that I would now have a $50 annual fee.  They paid themselves (to pay off the existing loan), $7,727.03 plus $50 annual fee and issued me a check for $1,222.97.  My credit limit is $9,000 however, my principal sum is now $9,624.25.  I have since paid them $1,361.00.

 Beneficial has called my home 10-20 times a day.  It's not that we don't want to pay this arrangement, but their loan terms are impossible, in spite of their explanation of how much better this new agreement will be for my financial needs. I have made payments as my income would allow and understand that the payment history on this loan is not good, however, we have attempted several times to work out other payment arrangements and requested that they lower our interst to a more manageable amount and they just refused to work with us. 

After two years Beneficial is mow seeking a judgement against us for $9,624.25, plus $5,010.06, plus $775.00 attorneys fees and any additional interest that has accrued since June 2007. Their desired action is to garnish wages, garnish bank accounts, and put a lien on our home.  

It is apparent that the $2,555.75 we have paid since the beginning of our agreement with Beneficial has not touched the principal balance but rather their exorbitant interest rates, annual fees, and administrative fees. I always believed that loan sharking and price gouging were illigal, however, it is apparent that Beneficial has found  a legal way to prey on desperate, low income families  who are desperately seeking ways to take care of their families.    

 

why would you even accept a loan at such terrible interest rates??when I purchased my home I made them stipulate on paper that I would pay no more than 6 percent  and I refused to back down...they wanted more of course... I just told them 6 percent or the deal wasnt going to happen....you MUST learn to be firm with these types of people as they only want your money and do not care if you can afford it or not..