Green Gate Loans is growing much faster than one would expect for such a basic tribal lender. While this site focuses on some of the larger, more complex (such as firms that offer a line of credit) Native American loan companies it's strange to see the growth taking place at some of the more 'simple' tribal lenders.
This is the story over at Green Gate loans (technically the company name is Green Gate Services) and it's a puzzle as to why they are having so much success with such a limited loan offering. It is marketing, or branding, maybe it's their excellently crafted website or the site design? Is it a super easy online application process?
Knowing that we will never know the answer is alright, because what matters is the fact that Green Gate Loans will continue to grow and this type of company might well be the future of tribal lending.
On the surface it would seem like borrowers would be looking for the most money to borrow as possible, and that they would want to have a longer amount of time to repay the loan. But surprisingly that doesn't seem to be the case.
What really sets Native American lending apart from most other businesses is that competitive pressures and comparisons are not being used too often by consumers when they make their borrowing decisions.
In most businesses, like restaurants, retail clothing, electronics and groceries the power of the purse comes into play. How much something costs is a major motivator for nearly all products and services in the economy.
Except that concept seems to get washed away when it comes time to borrow money online, and specifically for those with bad credit situations who turn to Native American lenders, it really seems to just vaporize altogether.
Potential borrowers who are desperately trying to hunt down some small to medium level of debt on the internet don't seem to shop prices, they do not seem to care what the equivalent product (or in this instance a loan servicing charge) will cost them at another online lender. Competitive pressures are not working very well in this environment of speed and desperation, most likely because of two reasons.
First, there is no really good centralized source of information concerning Native American lenders. Where is the directory? This site that you're visiting now is most likely the closest thing to a true directory of all Native American loan companies. And without that centralized marketplace it becomes too time consuming to try to shop and price out the costs of these loans, and people in general don't have time to waste. Especially people who are already in a troubled situation they are trying to move quickly and when they spot a tribal lender they will most likely just apply for that loan without much (or any) background information on that loan firm.
Whether the company is charging a 35% interest rate or a 10% interest rate doesn't resonate even though it should. It would seem that for someone who is already poor, desperate and/or broke the cost of the loan would be one of the main factors in driving the decision on whether to use that company or not. Here's the funny thing, it's not really a factor.
Second, the other problem is that people often don't read the literature of the loan. They just see that it's easy to get and the actual loan documents are written in very dry terms, so it's easy to fall asleep while trying to understand how much the loan will cost the consumer. The fact that this is not a simple process makes it hard for millions of Americans to concentrate.
Americans tend to get bored on the financial details, they simply want to skip to the bottom line and get to the end result right away, which means closing their loan, signing the paperwork and getting issued the loan, and that's it. The costs of the loan, how much it will ultimately cost, the chances of a better lending alternative or better company, all of that gets washed away with the hurry up nature many people searching for online loans.
These reasons, or some other reason that is missing, has to be the cause for Green Gate Loans getting the respect and growth in business that they've experienced. Green Gate doesn't stack up well against some of the more retail (the larger) tribal lending companies like Mobiloans, Plain Green Loans and Clear Creek Lending.
Green Gate Loans only offers a $200 to $500 loan which is quite low when compared to the $1,500 and $3,000 and $2,500 that are offered at the above lenders respectively. Now Green Gate does offer their repayments as an installment loan structure but is it meaningful?
The trend lately has been for certain tribal lenders to offer a payday loan dollar amount and marry that to the installment loan repayment method, with several scheduled payment dates. This is not a quality situation, I don't believe this is what consumers are looking for. However, it turns out that I must be mistaken because Green Gate Loans keeps growing, the numbers tied to people who are trying to find them show a clearly increasing demand.
This gets back to the point that just because a tribal lender offers a relatively high cost service, tied to a lower grade offering, doesn't necessarily mean that people will not use their service, because as Green Gate demonstrates, they will despite all logical reasons not to.
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