Advice on payday loans payoff - The Bills.com Blog

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Advice on payday loans payoff

Monday, Oct 8, 2007

Question: Do you all help payoff payday loans are do u know where i can go to get help with this?

Answer: These small loans, often called "cash advance loans," "check advance loans," or "deferred deposit check loans," are a frequent pitfall for consumers.

Bills.com also offers more information on the Payday Loan Information page, and has answered reader questions about payday loans in Massachusetts , Florida , Texas , Illinois , and California .

A fee anywhere from $15-$30 per $100 borrowed is charged for an average loan of $300. With rates so high and the term of the loan so short, there's no wonder that a very high percentage of these loans are rolled over by the borrower again and again so that the accumulated fees equal an effective annualized interest rate of 390% to 780% APR depending on the number of times the principal is rolled over.

You may be in luck in regard to your difficulty in repaying these loans. There are eight states whose payday loan regulating statutes require lenders to set up an installment repayment plan if an account reaches the maximum number of rollovers allowed by law and the debtor declares that he/she is
unable to pay the balance due. Check out the payday loan information from the Consumer Federation of America where you will be able to read all about these loans and the various state attempts to regulate them. Follow the "state information" link to find out the specific regulations for payday lenders in your state, and if you live in one of the eight states requiring installment payments. If your state does require repayment plans, and the lender still won't accept payments, call your state regulator of payday loans, usually an assistant Attorney General, and complain. You should get the results you want after the Attorney General's office becomes involved.

If you are not in one of those states, you
may want to consider simply making payments to the lender of whatever you can afford to pay down the balance of the loan over time. In most states, the rollover limit will soon be reached, and the interest rate the lender can charge will be capped by state law. If the lender will not accept your payments, simply put what you can afford aside each month until you have enough money to either pay off the loan or to offer a settlement. Read up on the regulations in your state to find the best strategy for your situation.

Hopefully, one of the strategies I have discussed above will help you resolve these payday loans, and help you Find. Learn. Save.

Best of luck,
Bill
www.bills.com

Also, make sure to get a free financial health check-up with Bills IQ!

User Comments

1. Posted by Raymond Borntrager on Saturday 8th December 2007 16:54

I am a resident of Tennessee. I have 6 payday advance checks out right now. Are there any loan agencies that would consolidate check advances and pay them off so I can only have one payment?

2. Posted by Nithin on Monday 10th December 2007 08:25

Thank you for visiting Bills.com Unless you own a home and are willing to borrow funds against your home to pay of these payday loans, it will difficult otherwise to consolidate your loans. If your credit score is good, you can apply for a personal loan at your local bank. Although the interest rates on personal loans are higher, they are definitely cheaper than payday loans. If you are having a tough time making the payments, then here is the information regarding regulations in the state of Tennessee (according to www.paydayloaninfo.org): Legal Status: Legal Citation: Tenn. Code Ann. §45-17-101 et seq. and Tenn. Comp. R. and Regs. § 0180-28-.01 Loan Terms: Maximum Loan Amount: $500 Loan Term: Max: 31 days Maximum Finance Rate and Fees: the lesser of 15% of the check or $30 Finance Charge for 14-day $100 loan: $17.65 APR for 14-day $100 loan: 459% Debt Limits: Maximum Number of Outstanding Loans at One Time: 3 (2 per licensee) Rollovers Permitted: None (cannot renew or otherwise consolidate) Cooling-off Period: Repayment Plan: Collection Limits: Collection Fees: One $30 NSF Fee; Court Costs Criminal Action: Prohibited Where to Complain, Get Information: Regulator: Tennessee Department of Financial Institutions Address: 511 Union Street, Suite 400 Nashville TN 37219 Phone: (615) 741-2236 Fax: (615) 532-1018 Regulatory Contact: Bart Daughdrill

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