For every $100 loaned to customers via same day loans, a 15 to 25 percent fee is added for the convenience. This amounts to $50 or $60 in most cases, which is hardly earth-shattering. According to Yahoo! Sports, now there’s a high-dollar variant of such instant payday advances for disenfranchised athletes: the NFL lockout loan. Players out of cash because of the labor dispute are being solicited by lending agents. Source of article – NFL lockout loans: More money, more problems by MoneyBlogNewz.
Interest on lockout loans of 36 percent Annual Percentage Rate
A 36 percent APR on a loan as little as $300 to $400 will not mean much while it can cost quite a bit for NFL lockout loans of over $60,000. The loans have been accessed by many players. Yahoo! Sports reports they were given to players from at least 16 teams.
The NFL Players Association lockout fund has helped some players, but clearly the response to high-risk lockout loans indicates that some players have not curbed their extravagant lifestyles in the absence of their paydays. The National Football League Players Association advised players to save at least three game checks from the previous season in anticipation of the 2011 lockout, but insiders report the advice may not have been heeded. MSNBC reports that it was also suggested by the NFLPA that players do other things to save and make money. This would contain autograph signings, fly coach or refinance their homes.
Why do NFL players have money issues
From a young age, star athletes are surrounded by enablers, according to psychologists. Since the players have never had to be in charge of their own finances, they have no idea how to do it once they get to professional ranks. Millions being given to somebody who was poor might also be a problem. These individuals might just spend it all up. After retirement, most NFL players end up bankrupt. Sports Illustrated estimates this to be about 80 percent of players. MSNBC indicates that as many as 380 of the NFL’s 1,700 players live from paycheck to paycheck, even though the average NFL annual salary in 2010 was $1.87 million. Players who spend too much can have a lot of difficulties, after taxes and agents, especially since rookie averages were at $320,000.
Lockout loan support
Sherard Rogers, a financial adviser to numerous NFL athletes, told Yahoo! Sports that lockout loans are a legitimate product that meets player demand. While franchises will endure, players who live to spend can run into trouble.
“Every NFL team was valued at over $1 billion, so they can weather the storm of a lockout. But could players if there weren’t resources to cover this short-term labor dispute?” asked Rogers. “The key is to figure out how to solve the short-term liquidity issue and put the pieces in place to ensure they don’t have this liquidity issue again.”
Information from
MSNBC
msnbc.msn.com/id/41855264/ns/business-personal_finance/41855226
Philly Sports Column
philly.sportscolumn.com/showthread.php?t=11751
The Real Athlete Blog
accessathletes.com/blog/blogDisplay.cfm?/Education-is-Key-for-Pro-Athletes-596
The Post Game
thepostgame.com/features/201104/tpg-exclusive-cash-strapped-nfl-players-seeking-high-risk-lockout-loans
Both sides are feeling the ‘deal heat’
youtu.be/CQD7MvhD3sI
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