TOP 5 HIGHEST DEBT INTEREST RATES ON FINANCIAL AUDIT

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TL;DR

Caleb shows five debt victims trapped in payday loans charging 500-900% interest, mostly from impulse purchases like a PlayStation 5.

Key Insights

900% for a PS5 — A $500 payday loan at 900% interest balloons to $4000 in repayment — someone actually took this out for a PlayStation 5.

3500 profit margins — Payday lenders pocket $3500 in profit off a $500 loan when the borrower only needed $500 — the math is why Caleb says 'they have no morals.'

Consolidation traps — Consolidating $40-50k in debt under a 35% interest rate is still predatory because the borrower doesn't understand they're being fleeced.

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Deep Dive

The 900% PlayStation mistake

Caleb opens with a woman who took a $500 payday loan at 900% interest to buy a PlayStation 5. The total repayment: $4000. When pressed on why, she admits she just really wanted one. This isn't an outlier — Caleb shows a second PS5 buyer who took a $792% interest loan for $500 and ended up paying $4000 total. The predatory math is stark: lenders collect $3500 in pure profit off a single $500 advance.

Wage garnishment and desperation

One borrower mentions the lender started garnishing her wages without a court order. Caleb clarifies these aren't government agencies — lenders can only garnish if you voluntarily give them bank account access. A $500 advance for a Galveston vacation spiraled into a $573% payday loan. The pattern is clear: people in liquidity crunches treat payday lenders as emergency credit, never calculating the true cost.

The consolidation trap

A borrower with roughly $50k in total debt consolidated under a 35% interest rate, thinking one payment was better than juggling multiple debts. Caleb's incredulity is sharp: even at 35%, she's still being extracted from. She doesn't grasp that consolidators are also making outsized profits off her lack of financial literacy. Caleb ends with a dark aside — the margins are so good he questions why he doesn't just ditch morals and start a payday lending company himself.

Takeaways

✓Never use payday loans for discretionary purchases — a $500 advance costs $3500+ in lender profit.
✓Understand the true cost before consolidating debt; 35% is better than 700% but you're still being extracted from.

Key moments

0:12PS5 costs $4000 in debt

“I bought a PlayStation 5. Really wanted one instead.”

1:14Lender profit extraction

“They gave you $500 and they make $3,500 of profit. Oh my goodness.”

1:41Consolidation is still predatory

“Consolidating to a 35% interest rate. They're making so much money off you.”

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