A word of WARNING to prospective borrowers

pekv2

hero member

Activity: 770

Merit: 502

Quote from: ?? on ??

You think I give a fuck about paying anybody back? LOLOLOL There's so many greedy idiots on here trying to make 10%, it's like taking candy from fish in a barrel.

Doesn't matter what the % is, the percentage is known of before you take out a loan, people like you deserve whats is coming to you.

Quote from: pheaonix on April 27, 2013, 07:50:23 AM

is it really a loan when nobody pays it back?

Yes, it's still a loan, no matter.

--

Take out a loan, pay it back, if not, the gum stuck under theater seats are better than you.

pheaonix

sr. member

Activity: 392

Merit: 250

http://casinobitco.in/ A+ customer support

is it really a loan when nobody pays it back?

pekv2

hero member

Activity: 770

Merit: 502

Yup, tis why I am building up my minted coins. Year ago it was ok to get a loan, it is just to crazy to get a loan atm. Plus btc difficulty is nuts, and ltc difficulty is rising. I wanted to get a loan to get a 7950, it is just to much up and down.

FinShaggy

full member

Activity: 196

Merit: 100

Google/YouTube

(Not Bitcoin, but...)
I actually plan on borrowing in an attempt to raise the value of a coin, Devcoins aren't worth enough right now, and I want to change that, but I need some Devcoins to do that.
https://bitcointalksearch.org/topic/need-devcoins-182699

Elwar

legendary

Activity: 3598

Merit: 2386

Viva Ut Vivas

Quote from: Birdy on April 21, 2013, 06:04:37 PM

Quote from: Elwar on April 21, 2013, 05:48:03 PM

Or the price is at $120 and you believe the price will drop to $80. You borrow 100 BTC at 50% yearly interest and immediately sell, the price drops from $120 to $100...did not go as low as you expected but still far enough. You buy back 100 BTC at $100/BTC and pay back your loan. You just made $2,000. You pay about $16.50 for the borrowed BTC for the day and you are set.

Happens all the time at BitFinex.

Or the price never comes back to $120 and you have no way of paying it back.

Which is referred to as the short squeeze.

Birdy

sr. member

Activity: 364

Merit: 250

Quote from: Elwar on April 21, 2013, 05:48:03 PM

Or the price is at $120 and you believe the price will drop to $80. You borrow 100 BTC at 50% yearly interest and immediately sell, the price drops from $120 to $100...did not go as low as you expected but still far enough. You buy back 100 BTC at $100/BTC and pay back your loan. You just made $2,000. You pay about $16.50 for the borrowed BTC for the day and you are set.

Happens all the time at BitFinex.

Or the price never comes back to $120 and you have no way of paying it back.

Inedible

hero member

Activity: 700

Merit: 500

What doesn't kill you only makes you sicker!

Quote from: Elwar on April 21, 2013, 05:48:03 PM

Or the price is at $120 and you believe the price will drop to $80. You borrow 100 BTC at 50% yearly interest and immediately sell, the price drops from $120 to $100...did not go as low as you expected but still far enough. You buy back 100 BTC at $100/BTC and pay back your loan. You just made $2,000. You pay about $16.50 for the borrowed BTC for the day and you are set.

So a person would do this if they were short of Bitcoins...?

Grin

Grim Death

member

Activity: 86

Merit: 10

Quote from: Elwar on April 21, 2013, 05:48:03 PM

Or the price is at $120 and you believe the price will drop to $80. You borrow 100 BTC at 50% yearly interest and immediately sell, the price drops from $120 to $100...did not go as low as you expected but still far enough. You buy back 100 BTC at $100/BTC and pay back your loan. You just made $2,000. You pay about $16.50 for the borrowed BTC for the day and you are set.

Happens all the time at BitFinex.

Like I said the price can go down, but then all you are doing is borrowing someone's money to gamble with. Which is not a good idea either, this is why our fiat financial system is in such disarray.

Elwar

legendary

Activity: 3598

Merit: 2386

Viva Ut Vivas

Or the price is at $120 and you believe the price will drop to $80. You borrow 100 BTC at 50% yearly interest and immediately sell, the price drops from $120 to $100...did not go as low as you expected but still far enough. You buy back 100 BTC at $100/BTC and pay back your loan. You just made $2,000. You pay about $16.50 for the borrowed BTC for the day and you are set.

Happens all the time at BitFinex.

Grim Death

member

Activity: 86

Merit: 10

At the minute it is not a good idea to be taking out loans in Bitcoins at all. The price is far too unstable.

Currently if you are taking out a loan in Bitcoins you have not 1 but 2 kinds of interest to contend with. The first is obviously the interest rate that was agreed upon with your lender. The second is the possible rise in price that Bitcoin could see. (obviously it can also go down. But lets face it, you are having to ask complete strangers for money, do you really think you are that lucky?)

So lets say you borrow 1 Bitcoin at $100 and agree to pay back 1.1 btc back in a weeks time. In that week the price of Bitcoin rises to $200 so now that payment of 1.1 bitcoins is worth $220. That ends up being an interest rate of 120% for just 7 days!!!

So if you are desperate for a loan that is for something that you will be paying for in fiat money, for gods sake try for a loan that is tied to fiat. When respected members take out loans with each other you will notice that in general the loans are tied to a fiat amount. This is because they aren't naive and stupid enough to borrow in Bitcoin when in 1 months time their debt could be far far greater.

Let Ian Bakewell be a lesson to you all.

Topic: A word of WARNING to prospective borrowers (Read 1108 times)