Call me old fashion, but I think car salesmen ought to make their money off of selling cars instead of exploiting consumer's ignorance of financial tools and more complex math. This is so much more nefarious.
Guy walks into a car dealership. He's dressed well. But the salesman is bored, he doesn't care. Idly, the salesman asks,
"Hello there. So, what kind of car have you been thinking about." He doesn't care.
"Oh no, I'm not here for a car. I was wondering if you had any derivative contracts that bundled those sweet financing contracts you've been floating."
Salesman bolts upright, and goes shifty eyed - looks around to see if anyone heard. He goes to the front of the office and locks the door. Now he's all ears.
Car dealers used to profit from people's emotions and ignorance about the product. That's a reasonable exploitation of ignorance because car buyers should know about the car they're buying.
Today, car dealers sell consumers to banks using cars as bait people. Exploiting people's ignorance of dense financial/legal contracts seems extremely abusive to me.
When I've bought mortgages, I was required by law to sign a document that says "I have read and understood these loan documents." I've seen many people in the newspaper complaining that they neither read nor understood the terms.
At what point do you expect legally competent adults to pay attention to and take responsibility for what they're doing?
>At what point do you expect legally competent adults to pay attention to and take responsibility for what they're doing?
At no point. I don't even consider it a matter of "responsibility". You can only take responsibility when things are clearly laid out. But what about the even more important responsibility to CLEARLY lay things out that should fall into businesses?
What I do expect and find important, and should be legally binding, is that no business should be allowed to hide the actual impact of purchases behind legalese and long-winded "financial product" descriptions, and then put the blame on the customer for not "reading through it".
At the very least, they should be explicitly, and in common, everyday language, give something like: "The average buyer that used this financing option ended up paying X% above the base price".
"At the very least, they should be explicitly, and in common, everyday language, give something like: "The average buyer that used this financing option ended up paying X% above the base price".
"
All this does is increase the number of documents.
Seriously. How do you think it got to be so many documents, where half are disclaimers and "plain english" warnings/etc for the consumer.
They usually don't hide the actual impact.
In the three states i've bought houses, there is at least one page in the set that literally says "you are taking out a loan for $x
your interest rate is x%
after 30 years, you will have paid $x for this loan"
Similar things happen for auto financing.
What more do you want?
Also note that no amount of plain english is going to make complicated things both simple to understand and correct in all the details. That's in fact, exactly why they are complicated. Most loan documents are pretty plain english these days, so it's usually not overuse of legalese either.
(plus, what makes it easy for you to understand may not be the same as for others).
One does not get to say it's everyone else's job to make you competent.
If you go and implement PaxOS and screw it up, you are welcome to try to blame Lamport for writing impenetrable papers, but most people are going to blame you for not making yourself competent.
You defend the leeching practices of financiers by the claim that the law already demands obvious hints in contracts, but consequently pretend that there was no obligation to educate. This is a contradiction.
> but most people are going to blame you for not making yourself competent
Shouldn't it go both ways? Businesses might be confident with your assertion and might rely on it to do business. But blame is the wrong attitude if you go in holding that opinion it's fraud. If you let someone sign a contract although you are sure they didn't read it, that's fraud. Simple as that. Why do I get weird looks when I actually start reading a contract I am about to sign?
"You defend the leeching practices of financiers by the claim that the law already demands obvious hints in contracts, but consequently pretend that there was no obligation to educate. This is a contradiction.
"
As i mentioned elsewhere, the vast majority of states very explicitly require education as well!
". If you let someone sign a contract although you are sure they didn't read it, that's fraud.'
Actually, it's not by any definition of fraud.
You have not intentionally deceived anyone of anything.
It would only be fraud if you intentionally told them the wrong thing, or deliberately tried to get them to not read it, or something more than "knowing this person has not educated themselves". We don't have a lot of thoughtcrimes.
It may be a void contract, but it's definitely not fraud!
" Why do I get weird looks when I actually start reading a contract I am about to sign?"
I don't, so i'm not sure.
In fact, in any real estate transaction i've ever been a part of, if i say "hey, do you mind if i take a few minutes to read this page more closely and ask you some questions about it", the answer i get is not "rolled eyes", it's "absolutely, that's what i'm here for"
I got what you said.
Apparently you missed mine, so let me try again, hopefully a little more clearly :)
You say the point is:
"That information should be displayed (by law) with prominent letters as big as the base price, under any sign/ad/etc which shows the latter."
I'm saying: It already is
Along with everything elseother people considered to be just as important to make sure everyone knew.
:)
IE The thing you want, has already happened.
You cannot find it, because not everyone agreed with you about what is the most important, so now you have 50 pages of the base price and the other important thing in big letters.
How can a person making an ad know how long a buyer's loan term will be or what interest rate they will qualify for? How would you know the value of any potential trade ins?
Things like the interest rate you qualify for are unique to the buyer. How can a print ad in the newspaper know the interest rate the buyer will qualify for? How can a print ad in a newspaper know what the purchaser of a car is going to trade in? There's not even a customer yet.
That was what my car loan paperwork did. It had a table with the negotiated price, the APR, the interest over the term of the loan, and the total price.
I expect this is legally mandated, and the question I have is which states are preferring to let the dealers prey on people?
This looks like people fumbling cryptocoin purchases (or getting them lost for some reason or another) and people answering with "ah you should have known better and done the right way"
And in any transaction I put the first blame in the person which had the more information in advance. It's their duty to inform the other, especially if they are the one's receiving the money.
Taleb has written something close to that recently:
I worked once for a classic U.S. investment bank of the prestigious variety, called “white shoe” because the partners were members of hard-to-join golf clubs where they played the game wearing white footwear. As with all such firms, an image of ethics and professionalism was cultivated. But the job of the salespeople (actually, salesmen) on days when they wore black shoes was to “unload” inventory with which traders were “stuffed”, that is, securities they had in plethora in their books and needed to get rid of them to lower their risk. (...) Salesmen hawked how a given security will be perfect for the client’s portfolio, how they were certain it would rise in price and how the client would suffer great regret if he missed “such an opportunity”, that type of discourse. Salespeople were experts in the art of psychological manipulation, making the client trade, often against his own interest, while being happy about it and loving them and their company. One of the top salesman of the firm, a man of huge charisma who came to work in a chauffeured Rolls Royce, was once asked whether customers didn’t get upset when they got the short end of the stick. “A customer is born every day” was his answer.
Which brings us to the notion of asymmetry, the core concept behind skin in the game. The question becomes: to what extent can people in a transaction have an informational differential between them? The ancient Mediterranean and, to some extent the modern world, seems to be converging to Antipater’s position. While we have “buyer beware” (caveat emptor) in the Anglo-Saxon West, the idea is rather new, and never general, often mitigated by lemon laws. So to the question voiced by Cicero of a debate between the two ancient stoics, “If a man knowingly offers for sale wine that is spoiling, ought he to tell his customers?” , the world is getting closer to Diogenes position of transparency, not necessarily via regulations as much as thanks to tort laws, one’s ability to sue for harm in the event the seller deceived him.
> What I do expect and find important, and should be legally binding, is that no business should be allowed to hide the actual impact of purchases behind legalese and long-winded "financial product" descriptions, and then put the blame on the customer for not "reading through it".
And in general, as I pointed out here, such contracts tend to be invalid in court. However, signing a piece of paper in plain english certifying saying "I read it" when one did not ought to mean something.
A legal doctrine where one can not bother reading contracts and yet get them decided in favor of ones imaginary terms doesn't sound like a workable system. The whole point of written contracts is so there's a record of what the terms were and what was agreed upon.
> A legal doctrine where one can not bother reading contracts and yet get them decided in favor of ones imaginary terms doesn't sound like a workable system.
Having to agree to dozens of pages of contract every day just to do seemingly ordinary things like using websites or ordering stuff online doesn't sound like a workable system either.
When they pass the bar exam. It's easy to think you understand a contract, but you don't.
Unfortunately clear language isn't litigated. The vague and obtuse language has a legal meaning, because it has gone to court. So that's what contracts are forced to use.
Exploiting ignorance is legally fair game, that doesn't make it ethical. At this point dealers are basically just selling consumers to banks.
I would blame the consumers if they could take their contracts home, consult with family, financial experts, etc. But, have you ever been in a sales room? Most people are pressured to sign ASAP and dealers generally refuse to print out contracts until after they're signed.
Not in the UK. A contract has to both be fair and understood in order for it to be valid. The thing is, given all the finance agreements I've had in the UK tell me what the total cost will be ( generally over double the cost of the product ) I'm not really sure these products aren't to be reasonbly understood and it woukd seem like laziness or greed eould be the biggest driver.
The exception to the rule here would be payday loans which have some horrible outcomes shouls you fail to pay them back on the agreed date. These were being legislated for the last I heard, so I'm not sure if they still exist.
The other game in the UK is targeting the poor with silly rates of interest in the knowledge that many of them simply won't pay. Technically they're high risk loans and thus somewhat valid but there is an argument that the likes of brighthouse shouldn't exist and that people without jobs shouldn't really be given finance to buy a tv at over double the retail cost.
> Most people are pressured to sign ASAP and dealers generally refuse to print out contracts until after they're signed.
I refuse to sign until I see a printed copy. Just remember that the dealers want that sale a lot more than you do. If they aren't being reasonable, get up and walk away. They'll change their tune very quickly.
No non-lawyer is competent to understand all real estate transaction documents. But they might be competent enough to acquiesce to the grand stupidity of our culture [1] and hire a real estate attorney. Mine reviewed all the relevant documents and come to the closing, for a flat fee that I thought was rather reasonable, in particular compared to the hand cramp I got from all the ridiculous paper work I had to hand sign.
[1] Consider: the banks, the title company, the county, all want hand signed documents. But we accept computerized voting machines to manage elections.
> No non-lawyer is competent to understand all real estate transaction documents.
I understood them well enough. It isn't that hard. The misunderstandings people would complain about were not about subtleties or legal hare-splitting. It's also established legal doctrine that a contract written in ambiguous, confusing, or tricky language isn't going to hold up in court. Judges take a dim view of that.
I also actually read them. Amazing. Although this would visibly annoy the escrow officer.
You did the right thing by having a lawyer review it if you didn't feel confident about it. There's no excuse not to if it is a large transaction.
A house is, for most people, a very large transaction. Saying "it isn't that hard" considering attorney's specialize in real estate is like saying "reading x-rays isn't that hard".
Had I not had an attorney present, it would have taken me all day, instead of 4 hours of reading stuff. It wasn't a matter of confidence in myself, it was a matter of having less than 100% trust in everyone else present.
" Saying "it isn't that hard" considering attorney's specialize in real estate"
Attorneys specialize in everything, the fact that attorneys specialize in real estate does not make every real estate transaction difficult, or require an attorney.
There are attorneys who specialize in speeding tickets. That does not make understanding the laws around speed limits difficult. If just means it's an area where attorneys believe they can make money by building a niche. That is not a measure of the complexity of that area, but of a large number of factors. (same with DUI)
In fact, attorneys specialize in real estate to handle the complicated things, which are not closings.
So your point kind of goes against this argument you keep trying to make.
I'm also not at all sure what your analogy to x-rays is supposed to be proving. It seems very strange
x-rays have no context and to people not familiar with at least anatomy and a number of other things, and are subject to different opinions.
On the contrary, real estate contracts, which are usually boilerplate plain english, only require understanding english. They may take a while to read, but they don't require specialized training. They are generally not subject to different interpretations, that's precisely why they are written the way they are!
There is no equivalent for x-rays that could make laypeople competent.
I should add that it isn't hard for ordinary real estate transactions, as the contracts are pretty standard boilerplate. If there's anything unusual about it, such as easements, water rights, unclear borders, weird covenants, by all means get a lawyer involves. If you're at all uncomfortable or confused by the deal, get a lawyer. Don't wing it and then blame the other party.
If you're buying an $800,000 house, often the most important investment in a person's life, spending a day reviewing the deal is a trivial incremental investment.
"No non-lawyer is competent to understand all real estate transaction documents."
This is bullshit, they are not complicated legalese.
Additionally, the vast majority of states require someone who can explain the documents to you be there at the closing.
Some require they even be lawyers.
Even those that don't, have provision on what must happen.
For example, in California, whoever is doing the closing will stop on each document, explain what the document is and what it says, and ask you if you have any questions, before proceeding to the next one.
I don't believe, when that happens, one can reasonably complain they didn't have a chance to understand the documents.
Look up the names Schwartz and Aurenheimer. They either ignored the click through EULA or deliberately broke it. Charged with CFAA felonies over it. One got prison for many years. The other killed himself to avoid it as well as to protest the insanity of having criminal charges brought against them because they broke the EULA terms on a web site. Both used scripts to cycle through ID numbers in a web page. This is what happens when you don't read. The system is fucked. Better make sure you aren't violating the TOS on any of the web sites you visit.
Schwartz knew he was doing something legally wrong, because he hid in a closet to do it. (The charges against him were also grossly excessive.)
I don't think these cases support your notion that EULAs were the issue. Nor do I think these extreme cases are cause for EULA concern for someone using software as it was obviously and reasonably intended to be used. Disclaimer: IANAL, and if you want real legal advice, go ask a real lawyer. Taking legal advice from the internet is foolish.
