Bright Star Cash is another tribal installment lender. Alright, stop the applause. I know, it's an installment lender so I should be happy and that we all prefer these type of lenders when compared to the 14 day loan gang, which also is known as the tribal payday lending industry.
Just what we didn't need, another Native American high interest lending operator pitching what is purportedly emergency cash loans. In the real world we know that only a relatively small fraction of these loans are going to people who are actually going through some type of emergency. The rest of the people taking these loans are just spending over too much money and getting in over their heads, and then they really sink the financial boat when they decide to borrow funds from a tribal lender like Bright Star Cash.
This company follows the normal protocols which we've all become too accustomed to, such as the pitch for emergency funds. But that's not all, we have the same high interest rates that dominate this business. Fortunately, one thing good about Bright Star Cash is the fact that they do admit to their extreme rates quite readily. They have a dedicated page that reads as "Rates" and on that page they provide two common situations (for their average borrowers) in which there are two different APR's listed, one has a 622% APR and the other has a 637% APR. The first loan represents a six month loan while the second rate reflects a 13 month loan.
One thing that I do like, and this is no surprise, is the length of time that the loans from this shop can be taken for. Six months is a much better and more realistic timeframe to repay a debt than a pathetic 14 days. 13 months is even better, and of course the customer will pay more with this longer loan but at least it's a real loan.
I just love these "loans" where the money is due within just days of taking out the loan. What was the point of even going through the process? If your checking account is about to go bust or you can't start your car, alright then you have an excuse (reason) to get this loan and take your chances on finding a way to repay the loan.
But we all know the loans taken under these odd and unusual terms of duress are much more rare than they are the standard. I will say with supreme confidence that at least 70% of the Bright Star Cash loans are taken by people who are not in these specific, time sensitive disaster situations. Instead, they are taken by people who are trying to pay off another loan or they are going to blow the money on some pointless consumption pleasure, like some restaurant or fast food joint, or maybe a trip or vacation. Possibly for a car stereo.
Who knows, the concept here is that you can't make the conscious decision that paying a 600% APR on a loan makes sense for that tasty consumable. No matter what the short-term gain is, it isn't going to make sense in the end because whatever you're buying is going to effectively rocket up in price. If you bought a bag of chips for three bucks with your tribal loan cash and then you pay the loan over the course of six months, well you actually paid $12 for that bad of chips. Hope those SunChips taste good because each chip is 20 cents.
Let's get back to the fact that this is an installment loan. That is a good thing but I'm having a little trouble with accepting the maximum loan amount of Bright Star is only $1,000. The truth is the firm isn't real clear with how much they are willing to lend but their front page has a drop down box that let's you pick from $150 to $1,000 as a loan amount to request, so I'm assuming that for a new customer these are the available amounts.
The problem is that Plain Green Loans and Clear Creek Lending and Great Plains Lending all have Bright Star Cash beat at the tribal installment lending game. Great Plains Lending allows a $3,000 loan to new customers. Plain Green Loans provides a six month loan with an APR that's under 60% which is much better than Bright Star Cash with their 622% APR. Clear Creek Lending is even better, with their $2,500 loan available at a 390% APR.
Do you see the problem with Bright Star Cash? They simply aren't as good as their competitors. Yes, it's good they offer the installment loan, that's nice. And the company website is well constructed with lots of security and encryption services, that's nice too. But the company doesn't deliver where it counts, which is dollar amounts, time to repay and interest rate on the loan.
Those are the 'big three' of tribal lending (and of any short-term lenders) that determine whether the company is offering a competitive product. And it turns out that Bright Star Cash just is not doing a good job in the face of these other lenders product offerings. So with that said, it's obvious that there are better options than Bright Star Cash including the companies I already listed, plus I'll throw in Spotloan and Mobiloans as better options as well, both of which offer relatively long-term structured loans with better features and costs than Bright Star.
If Bright Star Cash makes some change, like a lower interest rate or a much higher dollar amount that's available to borrow, then we can take a second look. But as things stand right now there just isn't any reason to go with them, they are paying attention to the Native American loan market and the market forces that are making lenders like them not very relevant as a lending option.
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