Big Sky Cash is a small time tribal lender that doesn't have much to offer. There's a simple problem with Big Sky Cash and that's the fact that they are a payday loan company.
That means we (as intelligent consumers) will take notice of the fact that there are substantially better options for short-term lending than Big Sky Cash. And the other lenders are not of a caliber that we are excluded from, such as Springleaf Financial or Wells Fargo. No, the other lenders we can work with are Native American lenders too, which means that getting qualified for a loan isn't going to be any harder (or easier) than getting approved for a Big Sky Cash loan.
Before we look at those other options let's do a quick review of Big Sky Cash. Just like most tribal payday lenders the company offers very short-term loans that range from 10 to 20 days, with most loans being right around 14 days. And just like the average tribal payday lender the borrower has the option of extending the loan if they can't (or are not willing to) repay the full balance due on their payday.
Does this sound familiar? To anyone who reads Native Loans with any regularity this is just a repeat of the same concept from so many other tribal payday shops. This is the same old situation we see with dozens of other lenders that have ties to Native Americans. If it's not the official industry standard (which it is not, there is no official industry standard) then it's the de facto standard operating plan that they work from.
The 14 day loan format is just like the non-tribal lenders, where they focus on every other Friday which also (how convenient) just so happens to be the pay date for most working people. Some workers get paid once a month and some get paid once every week but the big majority get paid every other week and it's usually on a Friday.
This gets back to the problem of whether getting to use the funds of company for 14 calendar days actually constitutes a loan. Of course it is a loan in all the legal ways, but in practical terms we need to ask ourselves if getting the use of those funds for such a very short period of time will help our financial situations in any meaningful way. T
he answer for the big majority (at least 70% and probably many more) is that it will not help them.
By the time a consumer gets the funds and does whatever they felt they needed to buy they are going to (nearly) immediately turn around and repay those funds plus an additional 30% of the original loan amount.
How has the consumers financial situation changed that dramatically in 14 days? Are we to believe that just because they received a paycheck that they are in the clear financially? They are not in the clear and most customers struggle to come up with the extra 30% that is required as the finance fee (the fancy term used for the interest charges for those 14 days) and that's where the payday loan extension comes into the picture.
Just like the non-tribal payday lenders that are scattered across the nation the tribal payday lenders are actually dependent on the borrower not being able to repay on the due date of the loan.
If that sounds unbelievable then just consider the question of where do the massive profits come from for these short-term lenders? If everyone repaid on the first payment date (which is the same as the due date for a payday loan) then how would these lenders make their money? They would have to issue millions of loans to get any kind of big profits.
Unfortunately the truth is they (the payday lenders owned by the tribes) like to get customers who are living right on the edge (of life and financially) and these customers are great for them because rather than just paying off the loan and taking "the hit" financially for that pay period they opt for the less painful (and excruciatingly long) way of simply paying for an extension on the loan.
In this scenario they pay for the 30% finance fee and roll the loan over. This situation will play out for several pay periods for certain customers. By the end of the loan some customers will have paid for the entire loan several times over before they actually pay the loan off and close the debt.
How and why is it that difficult to complete a loan? It's the design of the loan, there is no frame of time where the customer can get back on their financial feet and this creates a situation where they are always stretched out attempting to get caught up and pay down the original dollar amount of the loan. It's a game of psychology as much as it is having good money practices.
Most tribal lenders have (for some reason) decided to go the route of utilizing the payday loan as their financial vehicle. Yes, it is the most simple and it's been done so many times the proof of profitability is in the pudding. But there are much better ways to go about lending money, like a line of credit or an installment loan. Big Sky Cash has gone down the road of offering these payday loans and it is a financial product that I am just not interested in using or recommending.
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