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Loans -
First Plus advert is a 'death trap' - 15/05/2008
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A recent advertisement brought out by secured lender, First Plus, has been ridiculed by campaigners and officials after it made misleading offers regarding to a new secured loan.
The advert has also been accused of being a ‘dept trap’, that could lead vulnerable home owners into high and unmanageable debt.
The advert, which stars Carol Vorderman, states that a new loan, provided by the company offers low interest rate starting at 4.9 per cent for the first 90 days. However after these 90 days, the interest rate drastically rises, to 8.5 per cent.
An official from First Plus said: “Consumers don’t have many options at the moment and we are responding to this.”
However, an industry official said: “The initial rate is low enough to attract borrowers desperate for credit and who may be struggling to find it elsewhere. Yet 90 days offers negligible benefits and many people may not understand fully that the rate will soar in a very short time. This is a ‘debt trap.’ The timing of the advertisement and product launch has also come under fire, with so many people struggling and so many other lenders reining in on their lending.”
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