Player borrows $500K at 23 percent interest

AP

With nearly four months to go until the first game checks are missed, some players already need money.

A lot of money.

Our buddy Rich “Big Daddy” Salgado of Coastal Advisors, one of the leading insurance firms for pro athletes, has posted on Twitter that an unnamed player recently obtained a $500,000 loan, at a whopping 23-percent interest rate.

For the non-math majors in the crowd, that’s $115,000 per year in interest.

Thus, even if the players who run out of money can line up enough loans to get through a full season with no pay, they’ll be paying a lot for the privilege of having that money.

108 responses to “Player borrows $500K at 23 percent interest

  1. Maybe he’s going to turn around and loan it out to other players at 30%. Profit!

    Yeah right.

  2. LMAO @ 23%.Lender must not have too much confidence in the loan being repaid coupled with no capitalization available for the loan. Let me guess, the reason the insurance guy know about it is because the player had to take out insurance to cover the loan in case of death or injury; fairly common practice in major loans.

  3. Stupid, stupid. All the money they make (even the bottom feeders make over $350,000) and they can’t save at all?! Pathetic. Hope they default and go in foreclosure like the blue collar fans that can no longer afford to go to NFL games.

  4. Gawd! Plus there was probably a 5-10% fee for the person who brought the players to this loan broker. Why couldn’t he just go to the bank? Or a reputable financial firm?

  5. No way do players last a whole season without checks. Come July, they’ll cave in faster then Chicago’s oline.

  6. Glad to see the players using their educations to make sound decisions. First it was hiring De Smith, now 23% interest…couldn’t happen to a nicer group! Did this player put “slave” on the loan application for his occupation?

  7. Judging by the amount borrowed, I’m assuming this guy makes over a million a year. It’s embarrassing for these guys that piss away their money like this.

  8. WOW..23% interest? It seems more and more athletes file for bankruptcy every day, and I see the trend will probably continue.

  9. Seriously, what does this player do in the offseason, live in a cardboard box. Dude, you haven’t even missed out on any money yet!! WTF??

  10. Maybe it was Chad Johnson. If he bought a car with it and gave the car to someone else, then he wouldn’t have to pay back the loan…right PFT readers?

    Seriously, why isn’t personal finance a required course in all high schools?

  11. Is this a common practice with some athletes as a way of financially making through the offseason? I mean, they wouldn’t be receiving any kind of income at this time of year, even if there wasn’t a lockout. Or did this athlete want to make a specific purchase making this an isolated case?

  12. I remember the backlash against that guy who took the job with the railroad rather than sign a contract with the Jets.

    You think he’s borrowing half a mil at 23% right now?

  13. Can’t be cheap maintaining the Team Newton entourage. Just added a couple more hungry mouthes to feed.

  14. The thing is that the lock out probably has little to do with folks borrowing right now as technically they aren’t due to be payed until the season starts. However some guys are due minimal work out bonuses. If you need that money now, then it has nothing tondo with the lock out

  15. 23%? Sounds like the mob.

    And that would be awful if the mob had anything to do with the NFL.

    The next thing you’d know Goodell would be cracking down on teams for failing to accurately report injuries to ensure the mafia doesn’t lose money via an erroneous Las Vegas line.

    Oh, wait a second….

  16. Not sure but i think the players get most of their money during the season and if they are borrowing money it is not yet because of the lock out.

  17. Okay, whoever it is isn’t a great money manager and that’s on him. But take a look at your credit card statement. 23% is a bargain if you’ve been late with payment or two. Second, this guy has no guarantee of making a dime from now on since there’s no CBA and nothing to securitize the loan since he probably owes more on his house than it’s worth. No way a bank would lend him a penny. Way too many of us are in the same boat, but most of us probably wouldn’t have run up bills and spent the rest. But we might have at age 22 or whatever in that environment.

  18. it doesn’t say player, does it? it COULD be an NFL player. it could also be a soccer player, minor league baseball player, or just a dude that hooks up with tons of ladies who needs a quick infusion of cash to ball at the club.

  19. Any of you think it was Newton or one of the other high picks? In which case, he wouldn’t have the money from the previous season’s paycheck…..

    Of course, whatever he needs 500k for right now, I can’t imagine it’s a necessity, so he’s still an idiot.

  20. If anyone wonders why the owners decided to lock the players out its because of stuff like this. These guys are idiots with there money and this labor situation is going to end like all the others before, the players will come running back begging for a deal from the owners so they can get some more spinners and earrings.

  21. Anyone here want to pool their cash? I here there are some Suckers I mean football players in need of some cash. I think we should charge a reasonable 25% for our trouble!

  22. it would never be said of course but part of what’s got to piss these owners off something awful is that half the players they pay these big salaries to are to effin stupid to know how to handle it. They don’t invest, take care of family, contribute to society – it’s toys and hos and gold teef. What a waste.

  23. Note to all players: Everyone is USING you in this game… D. Smith, the agents, the loan sharks…. they are ALL benefiting from this lockout. Demand IMMEDIATE negotiation so you can get in and get your paycheck. Start looking out for YOURSELF. no one else will.

  24. HAS TO BE CROMARTIE!!! 8 mouths to feed, all less than 6 years old..A few concieved on same day, probably same bed. [ Deb changed the sheets for him]

    Either that, or someone just spent a whole lot on jewelry..Dez????

  25. brewdogg says:
    May 17, 2011 10:16 PM
    Any of you think it was Newton or one of the other high picks? In which case, he wouldn’t have the money from the previous season’s paycheck…..

    Of course, whatever he needs 500k for right now, I can’t imagine it’s a necessity, so he’s still an idiot.

    51
    ————–
    Newton has money. $1,000,000 from Under Armour and God knows how much from the SEC.

  26. If we’re all in the business of “speculating”, Dez Bryant spent a quarter of a MILLION dollars on bling during his first NFL season. That reckless spending sounds like a guy who needs to visit freecreditscore.com, not visiting a freakin’ mob boss named Rich “Big Daddy” Salgado. Don’t be surprised… if Dez ain’t collecting a paycheck by October that he wakes up with a horse’s head lying next to him in his bed.

  27. chedberg says: May 17, 2011 10:16 PM

    Definitely not Tom Brady. His wife makes much more than he does.
    ————————————————————–

    Actually, I believe Tom is technically the wife in that marriage.

  28. well if he repays it immediately he wont need to pay much interest but chances are that its some moron like antonio cromartie who will blow all his cash and be 10 million in the hole by the time he retires.

  29. That sounds like something more than one of the stupid players would do. No clue whatsoever how to manage the millions they already get. The “unnamed” player deserves paying usury rates.

  30. players are just like a lot of Americans, over extended and living beyond our means. this loan is just like those silly payday loans some people take out. sad

  31. Amazing….I make 60k per year and I saved enough to support my wife and 2 daughters so my wife doesn’t have to work while finishing nursing school…

  32. Makes you wonder how much owners and front office personel usually help out these players. Like you said none of them have missed a pay check so far. So even if the lockout was happening this guy and players like the ones who asked Brandon Graham for money would have had these problems anyway. But we never heard of things like this before.

    So whats that mean? Do players usually get advances from the team? Or from there agents? And now because of the lockout the teams cant do it and the agents cant afford it? Or maybe its as simple as its just now being reported. Maybe players take out these ridicolous loans or hit up teammates every year but its only being reported now because it fits into some scenario a reporter is trying to create or makes some point a reporter is trying to get across about players and the lockout.

    Who knows. I dont. I just find it strange that it just so happens that during a year that a lockout is occuring we start to here for the 1st time about all these active players who need to borrow money before they even miss there first pay check. It makes me think that we arent being told the whole truth or that somone is trying to turn something that is a common occurence and happens every year in the NFL into something that is lockout related.

    Its all a little suspicious to me and I have no doubt that the sources who are behind putting out these stories in the middle of a lockout have ulterior motives in doing so and arent just in it for a good story.

  33. “For the non-math majors in the crowd, that’s $115,000 per year in interest.”

    ————————————

    And for you lawyers out there, that is actually $127,932 in interest for the first year (assuming normal monthly compounding).

  34. so what? you know what interest credit cards and mortgages compounded actually charge? dont have te money to repay and the socialist government will “bail out” the debt owed to the billionaire banks. loansharking is now legal!

  35. Dumb asses, you`ve got yourself in that much debt and you`ve made how much already?
    Gotta keep tha bling bling in the ching ching I need a wing wing so can yo do yo thing thing help me sing sing
    You can have that for free Dumb ass!

  36. This is why the overwhelming majority of fans are pro owners

    Who would be stupid enough to put the future of this game in the hands of D smith and these idiot players!

  37. …and the players want to be partners in the league. If the NFL is to succeed, the players need to be employees.

  38. Should have hired Cam Newton’s dad to broker his deal, I’m sure he’d have gotten a much better rate.

  39. “Player borrows $500K at 23 percent interest”

    —————-

    “Playa borrows $500K at 23 percent interest”.

    There, I fixed the title for you.

  40. Gotta pay for that entourage, and for the car, and for the bling… Keeping up with all the others who have to show everybody how much money they got until they go bankrupt… Keep talking De Smith. I am sure the players will love you by the time this whole thing is done… Morons…

  41. Anyone citing an ESPN poll of any kind has lost all credibility. ESPN has been proven to, over the years, do all they can to get viewers. I would bet that would involve skewing a poll as well. If you read the comments on the labor articles they skew in a completely different direction. The bottom line is, if you are still Pro-player after the owners have made 2 proposals and the players haven’t countered once, then you are a stubborn mule.

  42. contraryguy says: May 17, 2011 9:35 PM

    “Moose, Rocco, help #27 find his checkbook.”

    **********

    Funny how a golf movie works even with football. Caddyshack is one of my all time favorites!

  43. Let’s hope that athletes invest their money wisely and don’t fall ino the trap of paying exhorbitant amounts of their money to insurance agents like “Big Daddy” (or better “Fat Daddy”/”Sloppy Daddy”). Agents like this take advantage of the good fortunes of athletes to support their own extravagant lifestyles of dining (quite evident), entertainment and buying personal relationships. What a sham!

  44. If any players are reading this, I’ve got plenty of money to loan at a mere 12% interest. That’s only 1% per month. Hit me up!

  45. A half a mi to cover living expenses? I thought these guys had financial advisors to help keep them from financial ruin.

  46. One thing we know: It can’t be Dez. Where would he spend that kind of money? He’s not allowed in malls, remember?

    My bet? Ochocinco, having to pay off the bookie after the bull-riding fiasco didn’t go the way he wagered.

  47. @billsfan1

    That wife you are leaving at home to make your BIG 60K a year is cheating on you and the kids arent really yours.

  48. Please just shut down the season. I think the aftermath of player related bankruptcies and arrests might be almost as entertaining as football.

  49. why are nfl players so “dumb” most people live beyond there means why would they be different just imagine being young and rich and a lot of your friends even richer if there dumb must of us are

  50. why are nfl players so “dumb” most people live beyond there means why would they be any different just imagine being young and rich and a lot of your friends even richer if there dumb most of us are

  51. Its bad financial decisions from immature people like this that put our economy in the crapper to begin with. Not to mention the bad financial decisions of banks and credit card companies to allow these types of loans in the first place. Will people never learn how to live within their means?

  52. “For the non-math majors in the crowd, that’s $115,000 per year in interest.”
    ___________________

    I’m not a math major, but I know that when you take out a loan, you make payments on that loan so the amount of interest you pay depends on the term of the loan. If you plan on paying off the whole $500K in one year, you would pay $64,458 in interest. If it’s a 10-year loan, you would average $78,129 a year in interest. Still a lot of money, but nowhere near $115K a year.

  53. I’m sure many athletes do this all the time regardless of lockout or not as in this instance the player hasn’t actually missed any pay checks. Regardless of profession and income most people in the U.S are in the same boat. (Credit Cards, Up side down mortgages etc..) So don’t throw rocks from your glass house people!

  54. them’s credit card usury rates…

    note to duh: IT’S OVER. GO THE NEGOTIATING TABLE AND SAY “YES, SIR” A LOT.

  55. Bull!!! Unnamed sources, unnamed player, unnamed lending company. My source said 3 of the owners are over 2 months behind on their stadium loans and another owner received his first default notice.

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