Category: Profits


This is Probably a Bad Idea… I Own a Payday Loan Company.

A Seriously Savvy, Experienced Payday Loan Lender Answers Direct Questions About the “Business of Lending Money to the Masses!”

[Jer Trihouse: To be clear, this is not my work! I just discovered this Q & A on an old Thread. Also, you’ll quickly figure out that this payday loan lender has navigated ALL the hoops, challenges and costs of securing a state license. So… like any of us who use the state licensing model, WE HATE TRIBAL LENDERS.]


Whether you’re a lender, a collector a borrower, a scrubber, a loan management software company, a state licensed or tribal lender… YOU WILL LEARN FROM THIS! [Lender Resources]

Question: Do you have trouble sleeping at night?

Payday Lender: Not even slightly!

Q: OK, what are some ways I, as a loan holder, can avoid getting super screwed by the exorbitant interest rate?

Payday Lender: Pay the whole goddamn thing off NOW and never take another loan out from me.

Q: My plan, but sometimes you’re in a hard place, and these guys are the only option. But I totally agree.

Payday Lender: Is it online/tribal? Do they show their lending license? If its tribal, stop paying. Then send a letter saying you will only pay 20% interest.

Default on the first payment then renegotiate is the easiest. Work with unlicensed vendors(tribal or foreign). Not state. They have no teeth with claims because they aren’t obeying the state laws so collecting is hard for tribes if not impossible.

Q: What percentage of your customers are one time (or at least, super rarely) customers compared to the every week sort of customer?

Payday Lender: About half are habitual repeaters.

Q: That’s actually far better than I feared, but still far too many people trapped in that cycle. Any insight into why? Do the people lack skills? Does your area lack jobs? Is there some common theme, like medical bills or bail money that’s very common?

Payday Lender:  It’s lower than the industry average because my business model doesn’t actively pursue reloans. We can’t take more than 2 loans out on a person per year. I have seen everything from my car broke down and I just need this to get me to work; to, repeat offenders who make $80K a year (verified). I really don’t know of commonality I think there’s just a wide range of reasons.

I do have an idea how to fix it. Force contracts to carry an amortization schedule with a minimum number of payments. Say, 10 equal payments for example. Each payment reduces principal (NO INTEREST ONLY). This prevents them from HAVING to take a loan out every two weeks to cover bills. Don’t allow more than 2 loans per household per year, industry wide not just per lender. They will jump from lender to lender otherwise. This should be used as emergency money not a check cashing service.

Look, I make enough money following the rules and playing nice I don’t have to ream them too.

Q: Why is money the most important thing to you?

Payday Lender: Its not but its close. Money means freedom: freedom to live how I want.

Q: And you feel it’s acceptable to use others to get what you want, even if that means that their quality of life is diminished?

Payday Lender: I also feel like this is insulting to my customers. Shit happens and if it happens to someone with awful credit what are they supposed to do? So yeah I profit from that. Does it bother me? no.

I don’t advertise, my customers come to me, no ones forcing them to take a loan. And unlike other paydays I amoritize rather than taking the full amount and forcing them to renew. Instead of 1 huge payment at the end of the pay cycle forcing them to take a new loan. I take small payments for several weeks so if its truly just a bad luck thing. They arent locked into a never ending cycle.

So no I have no qualms about what I do or how I do it.

Whats the alternative? No one comes to me thinking its a wise life decision.

Q:I’ll just be leaving this here… Youtube

I’d like to hear OP’s take on John Oliver’s report (see above link) on pay day loans. Do you think it is accurate?

You sound like a rare breed indeed. Kudos for not trying to milk every dime out of ppl that you could.

Payday Lender: I love John Oliver. I have HBO and watch every episode. This episode made me think a bit about everything else I see though. He paints with such broad strokes it misses the nuance, like the show News Room, I think that nuance is truly where the difference lay.

The interest rates suck, but that’s not the issue. They have to because of the default rate is so high.

If I knew I was going to get my money back I could charge 20% like a credit card. But 25% of the time we lose not just the principal but the entire cost of servicing the loan ( to contrast bank loans have less than a 0.25% default rate). So, that means that the other 75% of payers have to make up that massive loss.

Lend someone 1000 dollars and it costs you 100 to service, so you are out $1100. You have to make $1200 to really make it worth it. So if you lose $1100, 25% of the time, how much do you need to make on the other 75% of the time just to break even. How much is that in interest to the other loans? Do the math…it sucks. And yes 25% is the industry average default on first time payments [FTPD] NOT the total default, that’s even higher.

I do think there’s severe problems with the industry, and that predatory renewals needs to be addressed (see my other comments above). The interest rates aren’t really the problem though… 500% is calculated on 2 weeks drawn out for 52 (so its really 20 to 25% a payment). If you can find me someone who can collect for 52 weeks I will show you the next Bill Gates; it just doesn’t happen.

So here’s the fix. Set a max to 200% APR, then force it carry it for 10 payments and no more than 2 loans a year, that way they have the opportunity to get out of debt, and you can still make some money.

I also think that this is a necessary service. Our customers don’t want to go bankrupt. They want to pay their debts, but that intention doesn’t matter to banks or lenders, so they can’t get a loan anywhere else. I have actually had customers in tears thanking me because they have no other options. The problem is there’s really no regulations on the industry. I can setup with a tribe and basically write my own law. So, some of my compatriots use that so they don’t have to obey state laws; this means they can do dumbass shit like auto fund renewed loans based on some bs contract no one read.

So I have limits, I draw the line, I know the difference between really fucking someone, and just covering my risk.

I am open to alternatives too. If not this what do we have, loan sharks?

Look, you don’t pay me I send you an angry letter; not break your legs.

Here’s a challenge. Tell me a better model. Vet it with financials. I wanna see spread sheets, planning, a well thought out idea. You tell me that and I will not only fund it, implement it with my call centers, staff, but I will even pay for the lobbyist. Hell, if its good enough I would hire you and get you a share of the profits.

Q: So whats the alternative? Illegal loan sharking?

Payday Lender: If you push it out then the loan sharks will come back. Remember prior to the 90s how the mob was pretty powerful in places like Vegas Chicago NY KC Boston(pretty much every major city)? Now they aren’t…

I am all for fixing the regs getting rid of tribal/foreign and repeat loans. Say a cooling off period before they can re-lend.

But It also used to be that you knew your banker. And if you needed $500 to fix your truck to get to work you would walk in and say “Hey Bob I need 500 can I pay you back over the next few months?” The regulatory environment and consolidation of banks broke that. So now where are you to go?

And don’t get me wrong the big banks needed those regs I am all for it.

I’ve seen it multiple times, and again its a very narrow view, and the problem is then everyone’s assumptions are based on that kind of narrow view. For example, who said I have a location? I used to, but stores are like a big “Rob Me” sign, I am online only now, and lend to residents in the state of Nevada and California where I am licensed to operate by the state. You have to go looking to find me, I don’t advertise.

Unlike the guys Oliver is talking about which makes it seem like everyone operates that way.

Here’s the difference between state and tribal.

Because of that state license, I have to follow lending rules in that state, like maximum interest rates, no more than 2 loans per person per year etc. I get audited every quarter to make sure I am doing this correctly (by both states). I pay taxes. I have to keep a bond with the state to make sure if I break these rules I can refund my customers. I can’t auto re-loan. I have to follow state collection guidelines. It goes on.

But on the flip side, I have protections which allow me to file actions against those who don’t repay me.

Tribal/Foreign based lenders don’t have to do any of this. They pay a fee to a tribe then write their own rules. And Oliver is talking about us as if its the whole industry when in reality its about half.

Q: This should be the most visible comment. it explains everything I was wanting to know about this from your side of it. Maybe I am missing something that makes you out to be a horrible person with a horrible industry (which I had previously believed) but you are running a business

Payday Lender: Thank you, I am sending this thread to the friend who put me up to this. She thought I was really going to get reamed. (which in fairness some have but nothing too harsh)

Q: Shit man, people are giving you hell and the credit card companies are cool? You’re filling a void in the marketplace.

Payday Lender: Honestly no ones giving me too hard of a time. It’s all been super civil. I thought it would be a lot worse.

But we wont let you dig too deep of a hole… I want my money back.

So here’s the math on the credit card. $1200 charged. 3% minimum payment and 20% interest is $2310 in Total payments back.

Borrow 1200 from me and run it to term its $2800 So that’s 20% higher than a credit card. But if your credit was good enough to get a card, you wouldn’t be coming to me, so yeah I have to charge more.

Q: How much money would a person need to start a business like this? How does one get into this business?

What happens to a market that is not allowing new talent in to proliferate the business?

Payday Lender: No one said that. I said its hard. The biggest lender in the industry is about to go out of business so there’s about 1 billion up for grabs… go get it if you want it.

Q: What do you mean by this? Do you mean take out s big loan and just not pay it back because they won’t be able to collect?

Payday Lender: No I mean theres about to be a lot of room for upstarts in the industry.

But shit now that you mention that… google biggest payday lender, borrow from him, then don’t pay him back …hes tribal and unlicensed. So unless you live in a few super red states he can’t collect or submit you to a credit agency. Only borrow online. Not in a store front. Stores are licensed.

Q: Could he collect or submit to a credit angency in Mississippi?

Also. Is there anything he could do to get the money back that would have bad effects for me? Could he sue me? Is he likely to do so? Is this a common scam to pull? What am I looking at by doing this? Sorry for all the questions. I only ask because I’m in a really tight spot. And desperately need about 1600 dollars.

Payday Lender: Collections is just annoying calls and you can send a cease and desist.

The credit reporting would have be in the contract, but if its a tribal lender I doubt they do. If its tribal they are breaking state laws, so they cant go to the states attorney to file an action or lien. It also means they really can’t sue either.

If they are a state Licensed Lender in Mississippi then their website or store location would have a copy of the License on their website. If they are state licensed, then they can sue and file actions.

If its a store front its probably state licensed. Online is about 70/30 where 70 are tribal.

If you are interested in the sector look into micro financing for developing nations as well. Cheaper easier, no regs, and a lot of free flowing money from investors.

Q: Would you mind going a little bit more in depth on this? What is micro financing for developing nations?

Micro financing is a kinda cool new idea. Developing countries have no real banking or credit sector. They also have lots of entrapeneurs. The dollar goes a long way there and they dont need much.

500 or so to start a business. So you get 10 to 20 of them together. Each get 500 to 1000 and they share risk with each other. Theres already people in those countries looking for lenders and act as middle men… so lend to the businesses all at a reasonable rate for a high risk investment 20 to 40% since theres a shared risk theres a high liklihood of repayment. And its not your money its investors who can afford the loss. If you are really slick, you set it up as a charity so if the investors lose money its a tax write off so who cares?

Rinse and repeat.

From Jer: You want to know more about “micro-lending?” Start here with “Confessions of an Economic Hit Man” by John Perkins and “Banking to the Poor” by Muhammad Yunus

Q: I’ve seen you haven’t received a lot of support here. For what it’s worth I know you fill a valuable space. People need money they don’t currently have and you provide that to them at a rate that is proportional to the risk the customer represents. Let’s be honest if they qualified for a credit card or any other option, they would use that first. I’d rather have people owe a local business man a few grand rather than owe the mob a few grand. Thanks for doing this AMA, very interesting.

How old are you?

How long have you been doing this?

How much money did you start with?

Did you take out a loan to start?

How comfortable are you living right now?

Payday Lender:

3 years ( I was a loan officer at a bank).

I had $100K of my own and another 1.5 million from investors

No, you can’t get a business loan large enough for a start up SBA just won’t allow it.

I make over 2 million a year and employ 23 people all of whom make over 40k a year + bonuses and benefits.

Q: What’s your professional background? Did you work in other financial service jobs/institutions before you opened your own shop?

Payday Lender: Banking was my background. I was a loan officer out of college.


So Dear Reader, what do YOU think? Shoot an email to me!!

Do you want to get started in “The Business of Lending Money to the Masses?” Click here: I WantMore Info.

How to Start a Consumer Loan Business: Installment lending, car title loan lending, payday loan lending, personal loan business

Click This Image for Some Light Reading 🙂 Over Your Weekend!

Note to my Reader: This originally appeared here: Thread
And no, it is not me. Apollonius01, if you’re reading this, WE WOULD LOVE TO HEAR FROM YOU! WELL DONE, BROTHER! Jer


The Business of Lending Money to the Masses

The Business of Lending Money to the Masses 

I’m asked every day if there is still an opportunity for lenders to achieve an extraordinary ROI on their money by lending money to the masses.

How to Start a Loan Business

No doubt Dear Reader, you are inundated with ads daily offering you immediate cash via direct mail, TV, billboards, Fintech offerings,, radio, podcasts, online ads … just like I am.

So… you’re jaded. You’re an investor and an entrepreneur. You’re immune to these pleas made to borrowers to accept a lenders’ money.

WHO CAN”T GET THEIR HANDS ON $700 in a pinch?

The answer? Tens of millions of ordinary people all around the world.

According to the latest research by the Center for Financial Services Innovation (CFSI), 57% of Americans are not financially healthy. The situation is critical – 40% can’t come up with $400 in an emergency. The FED’s numbers are that 70% of consumers cannot come up with $1000 in an emergency!!

DO YOU REALLY NEED THESE STUDIES? Look around. Talked to your Uber driver lately? Your DoorDash delivery person? Any friends or family members working in the “gig economy?” In spite of their college degree, they’re forced to work as a barista? How about your local entrepreneur who needs cash today in order to pay for his supplies or make payroll until paid by her client?

The car breaks down; they can’t work. The lights get turned off. Their bank NSF’s 3 checks; the biggest one first. That’s 3 NSF’s amounting to $105.00! Can’t pay the deductible for their elective surgery.


What loan products are these tens of millions of consumers and small businesses looking for? Advance law suit funding, lap band surgery, car title loans [Auto/RV/Motorcycle], bitcoin & crypto, single payment [Payday], installment, amortized, line-of-credit, personal loans, biz startup funding, cash advances, vacation funding, designer watches and on and on! YES! YOU think many of these loans are for stupid reasons BUT they make sense for millions of folks DAILY!

The need for access to money by consumers is so overwhelming that Lenders can focus on niches. Here’s a few listings to get your idea muscle moving:

  • Think Sofi: focused on student debt
  • SALT Lending: focused on bitcoin and ethereum as collateral
  • Diamond Banc: Loans on luxury watches
  • Lending Club: peer-2-peer lending
  • CasnNetUSA: payday and installment loans
  • Lending Tree: debt consolidation peer2peer
  • Joey’s Auto Title: face-to-face car title loans in Albuquerque
  • Norris Group: hard money RE lenders
  • Prodigy Finance: lends to international students to
  • Insikt: consumer lending [The founder started at the rear of a Latino grocery store.]
  • LendingPoint: small online consumer loans
  • World Acceptance: face-to-face sub-prime consumer loans; $120M/quarter.
  • Oakum: lends only to immigrants
  • Wilshire: face-to-face car title loans to Koreans in Los Angeles
  • Fulcrum: Online and face-to-face personal loans to Haitians in Miami
  • Blinker: sub-prime car finance via an phone app
  • Dave: sub-prime personal loans via phone app
  • Accion: funds underserved small businesses
  • Groundfloor: real estate platform for non-accredited investors
  • CircleUp: Consumer goods financing
  • Fluid: Founded by our friend Timothy Li. Consumer credit for students.

Put on your thinking cap! What experiences do you bring to the business of lending money? Challenges? Hardships? Don’t you think there are millions of others out there facing the same financial challenges you have?

Tap into this! How do you solve these challenges, service these millions of borrowers in a humane way AND MAKE SOME SERIOUS MONEY?

Little. Big. Lenders come in all colors and flavors.

Ready to launch your loan business? Start here: “The Business of Lending to the Masses.”

How to Start a Consumer Loan Business: Installment lending, car title loan lending, payday loan lending, personal loan business

Click This Image for Some Light Reading 🙂 Over Your Weekend!

“How to Start a Consumer Loan Business & Lend Money to the Masses”


Payday Loan Companies Record Profits

Payday lenders and the stock market prices for their publicly traded shares are at record highs.

Why? Because payday loan lenders have been transitioning away from mono-line payday loans for the past several years.

If you’ve been following our advice here at, you’re no doubt aware that micro-lenders – that is payday, car title, signature, line-of-credit lenders – have been busy creating new loan products for years. That means for many lenders, the stereotypical “payday loan” product makes up less than 20% of their loan portfolios.

Of course, the folks at Bloomberg just figured this out. Too bad they’re too busy to listen to the earnings report calls we enable our readers to jump on!

Enova International Inc. has more than doubled so far this year, the best performer in the Russell 2000 Consumer Lending Index, followed by rival Curo Group Holdings Corp., up 64 percent.

Read more here…

Ready to launch your consumer loan business? CLICK HERE TO GET STARTED

How to Start a Loan Business Payday Loans


Payday Loan Kiosk Machine Revenue Share Opportunity

I’m in need of a store front owner to allow a state-of-the-art payday loan KIOSK machine to be placed in their location.

This is a revenue share proposal.

No out of pocket expense to the store owner.

This new technology, enables a consumer to apply for a PDL and receive cash within 60 seconds.

Kiosk operates 24/7.

The KIOSK manufacturer has been in the PDL space 11 years.

They have 90 KIOSK loan machines.

US expansion is the goal.

The KIOSK manufacturer provides ALL capital to fund the PDL’s.

The KIOSK manufacturer ships, delivers, and sets up the PDL machines with Internet; no expense to you.

The KIOSK manufacturer has developed software to analyze each consumer loan applicant’s individual credit history, and enable the borrower applicant to select a loan principal amount, and fund the loan immediately via the KIOSK in cash, debit card, or bank deposit.

The KIOSK scans and dispenses checks as well.

The borrower simply approaches the KIOSK, chooses the amount they desire to borrow, enters an SMS code to verify their phone number, places their ID on the built-in scanner, a built in camera takes their photo, borrower “signs” agreement with their fingerprint and they receive CASH IMMEDIATELY!

KIOSK manufacturer maintains a 24/7 call center. They handle all inquiries, issues, questions, collections…

A single KIOSK can service up to 500 borrowers/day.

Kiosk dispenses loan proceeds in cash and accepts repayments by cash, check, debit card…

Consumer loans can be repaid via the KIOSK, via the KIOSK manufacturer’s website or phone.

No consumer bank statements required.

No borrower CRA reports required.

Consumer data HIGHLY secured.

Consumer does NOT need to fill out ANY documents. Consumer does NOT submit bank statements OR pay stubs.

Ultimate goal is KIOSKS in convenient locations throughout USA. In malls, metro/gas stations, supermarkets, casinos,

Kiosks and software is completed and ready for immediate deployment.

60 seconds from application to cash in hand to consumer.

These KIOSKS & this technology is WORKING TODAY!

Interested in exploring?

Email your name, State, and phone number to
Put in the “Subject:” KIOSK MACHINE

Jer – Trihouse


How to Make Serious Money Lending to the Masses

You want to make serious money by lending money to the masses or you would not be reading this.

To be successful as a lender – or in any other entrepreneurial endeavor – you really only have to be good at  a few things:

  • Picking the right business niche
  • Raising money
  • Hiring good people
  • Ability to iterate through your challenges
  • Be bold. DO OR DO NOT!

Pick the Right Business Niche

Let’s get real!

Lending money to the masses can be very profitable!

Payday loans, signature loans, car title loans, personal cash advances, merchant cash advances, business to business loans… whatever you call them, all can be very profitable.

Real world example?

We’re charging $15 to $30+ for every 14 day loan we make. [Depends on the state we’re in or the tribe we collaborate with.]

That’s a 400%+ annual percentage rate (APR) for a borrower to use our money for two weeks.

I’ve watched stores reach $10,000 in loans after only being opened 3 weeks; within a year, $100,000 on a good week and generating $50,000/month in fees.

Sure. Lenders have costs. Payroll costs, utility costs, website costs, merchant processing, rent, legal, taxes… but you get the picture.

A lender’s inventory is MONEY!

It’s not flowers that die on you. It’s not food that rots. It’s MONEY, MOOLAH, COIN, DINERO, SCRATCH $$.


DONE! I’ve established that the business of lending money to the masses can be very profitable!

Raising Money

This is a mindset. It’s about presentation. Practice getting good at distilling your idea into a bite sized amount. Get your business launched.

I’m not taking about immediately achieving huge scale. Just get your loan business open for business and fund a few loans. Store front, Internet, mono-line, combo… just fund a few loans!


Friends, family, peers, members of your network… will find out what you’re doing.

They will want to learn more.

Don’t be shocked when they say something along the lines of, “I have $20K sitting in the bank earning 1% per year before taxes and inflation. Could you put my money to work in your new business?

Of course you can! Offer them 6%, 8%, 10%+ per year. You can afford it when you’re grossing 500%+ APR’s on your loan portfolio!

NOTE: Not sure how I’m calculating these APR’s? Go here: Sample APR Calculations

Hiring Good People

If you’re good at raising capital, you can hire people to do everything else.

You can hire a CEO.

You can hire a lawyer.

You can hire an experienced customer service representative.

You can buy “off the shelf” loan management software.

You can subscribe to a sub-prime consumer credit reporting service.

You can hire great people to do any part of this business you choose to.


To hire right, you need a big funnel. You have to sort through a ton of leads.

You need a system; an on-boarding process.

You’ve got to learn how to do this! [This intel is in our “How to Start a Loan Business.”

The quality of your life is about the people around you.

Everything that bad happened to you in the last 10 years did not happen in a bubble.

Someone either DID or DID NOT do something to you.

That’s life.

Most problems in life are people problems.

We let the wrong – or right – people into our lives.

In business there are some whack jobs! Don’t let them in!

Now go out and BE BAD!

Jer – Trihouse Consulting

How to Start a Loan Business