WSVN — If you borrow money, what is the highest interest rate you can be charged? 10 percent? 200 percent? Maybe. It depends on the loan and the business and it’s why one South Florida woman called Help Me Howard with Patrick Fraser.
Bonnie Groves-Zden: “And the plants I got into when I was real little. I just love them.”
Some people have a green thumb, Bonnie has two green hands.
Bonnie Groves-Zden: “I have the calla lily; I have an easter lily. I have spider plants, a pineapple plant, pineapple flowering plant and I have lion tongue right besides the door like the one that’s right there.”
What Bonnie doesn’t have, though, is a lot of green in her pocket and when her daughter was going to have surgery in the Cayman Islands, she needed money to fly to take care of her.
Bonnie Groves-Zden: “I came up with it in like talking with my cousin. She said, ‘Bon Bon, you have a ton of jewelry that you have that you are not using.'”
Bonnie then took a bracelet and a coin to a jewelry store. They loaned her $1,100 and under annual percentage rate, wrote 10 percent.
But Bonnie says, someone added a month to make it 10 percent a month. She says no one told her that.
Bonnie Groves-Zden: “10 percent interest. She told me that it would only be 110 into 1,100. The money that I would have to pay them back would be $1,210 and that’s what I agreed on.”
Bonnie took the $1,100 loan and each month sent a payment from the Cayman Islands to pay down the loan. Then this Summer she went to pay off the rest and pick up her jewelry.
Bonnie Groves-Zden: “At that point the lady said, ‘Oh no. You have to give us back the $1,100 you borrowed from us. What you’ve paid in is only interest and then you have to pay us back the $1,210.”
So instead of paying $110 in interest, Bonnie had to pay ten percent a month or $1,200 plus the $1,100 she borrowed for a total of $2,300.
Bonnie Groves-Zden: “I was so shocked. I basically said, ‘No, that is not what you said.’ At that point I was so upset that I had to leave. My heart was pumping.”
Bonnie didn’t have the money they wanted, but couldn’t bear the thought of giving up the jewelry she had borrowed money against.
Bonnie Groves-Zden: “The coin is the only thing I have left from my husband who died without insurance, the bracelet, because it has sentimental value.”
She could afford a 10 percent a year loan. 10 percent a month or 120 percent a year is impossible for her.
Bonnie Groves-Zden: “I am very sad. I don’t sleep. I’ve lost weight.”
So Howard, is the contract right? Can you charge 120 percent interest a year — meaning Bonnie is going to lose her jewelry?
Howard Finkelstein: “It depends on your license. State law allows a pawnshop owner to charge up to 25 in interest and service charge per month. But Bonnie pawned it at a jewelry store and by law they can’t pawn or charge interest at all. They are not allowed to loan money and hold your merchandise.”
We contacted Liria Jewelry. They told us they also own a pawn shop and Bonnie’s contract was written under the pawn shop license. They told us they didn’t feel they did anything wrong.
When we pointed out that the deal was done at the jewelry store and the payments were made to the jewelry store and not the pawn shop they said ‘Ok’ and gave Bonnie her bracelet and coin back.
Bonnie Groves-Zden: “I am happy. I am so happy.”
Even though legally Bonnie didn’t have to pay any interest, she wanted to keep her word and repaid the $1,100 she borrowed plus the $110 in interest.
Bonnie Groves-Zden: “I came home, thanked the Lord for it. Had a good cry because this jewelry was very sentimental to me, the coin especially.”
Patrick Fraser: “So why can a pawn shop charge 25 percent a month or 300 percent a year when a bank can only charge up to 25 percent a year? Because the politicians in Tallahassee said they could and if a lender charges more than 25 percent, it’s a crime. Check to see what you are paying. Hopefully, you won’t be shocked like Bonnie was.”
Inherited a jewel of a problem you want to unchain? Pawn it off on us. We don’t charge interest but we have great interest in helping you.
With this Help Me Howard, I’m Patrick Fraser, 7News.
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