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 Posted: Thu Mar 16, 2006 2:23 pm Subject: PayDayOk letter |
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As of today February 10, 2006 I do not authorize you to withdraw any funds from checking account number ########.
Your company is guilty of breaking The State of Michigan criminal usury laws.
CRIMINAL USURY (EXCERPT)
Act 259 of 1968
438.41 Criminal usury; definition; penalty.
Sec. 1.
A person is guilty of criminal usury when, not being authorized or permitted by law to do so, he knowingly charges, takes or receives any money or other property as interest on the loan or forbearance of any money or other property, at a rate exceeding 25% at simple interest per annum or the equivalent rate for a longer or shorter period. Any person guilty of criminal usury may be imprisoned for a term not to exceed 5 years or fined not more than $10,000.00, or both.
History: 1968, Act 259, Eff. Nov. 15, 1968
CRIMINAL USURY (EXCERPT)
Act 259 of 1968
438.42 Usurious loan records; possession, penalty.
Sec. 2.
A person is guilty of possession of usurious loan records when, with knowledge of the contents thereof, he possesses any writing, paper, instrument or article used to record criminally usurious transactions prohibited by this act. Any person guilty of possession of usurious loan records may be imprisoned for a term not to exceed 1 year or fined not more than $1,000.00, or both.
History: 1968, Act 259, Eff. Nov. 15, 1968
Your claim that the contract that I signed is only governed by New Mexico law is unsubstantiated. There is specific case law that refutes your claim. Your company solicited, accepted and transacted business with a citizen of the State of Michigan, thus you are subject to the laws of this state including the usury laws.
“Dot Com repeatedly and consciously chose to process Pennsylvania residents' applications and to assign them passwords. Dot Com knew that the result of these contracts would be the transmission of electronic messages into Pennsylvania. The transmission of these files was entirely within its control. Dot Com cannot maintain that these contracts are "fortuitous" or "coincidental" within the meaning of World-Wide Volkswagen. When a defendant makes a conscious choice to conduct business with the residents of a forum state, "it has clear notice that it is subject to suit there." World-Wide Volkswagen, 444 U.S. at 297, 100 S.Ct. at 567. Dot Com was under no obligation to sell its services to Pennsylvania residents. It freely chose to do so, presumably in order to profit from those transactions. If a corporation determines that the risk of being subject to personal jurisdiction in a particular forum is too great, it can choose to sever its connection to the state. Id. If Dot Com had not wanted to be amenable to jurisdiction in Pennsylvania, the solution would have been simple--it could have chosen not to sell its services to Pennsylvania residents.” (W.D.Pa. 1997)
As I am sure you are aware that even the State of New Mexico realizes that your practices are unfair, as on February 15, you will no longer be able to conduct business in the manner that you now do.
12.2.10.8 UNFAIR OR DECEPTIVE TRADE PRACTICES:
A. It is an unfair or deceptive trade practice for a small loan lender to offer or make a small loan that is not based upon reasonable underwriting guidelines, such as the borrower's income, or when the lender knows or should know with the exercise of reasonable diligence that the loan is beyond the borrower's reasonable ability to repay according to the terms of the loan. For the purposes of this rule, there shall be a rebuttable presumption that the borrower has a reasonable ability to repay the loan if the loan amount does not exceed 25% of the borrower's net monthly income.
B. It is an unfair or deceptive trade practice for a small loan lender to rely solely on the loan-to-value ratio in extending a loan to a borrower.
C. It is an unfair or deceptive trade practice for a small loan lender to misrepresent that a borrower meets the lender's underwriting guidelines for a particular loan or to misrepresent that particular guidelines are being used when the borrower does not meet the lender's underwriting guidelines or when such guidelines do not exist.
D. It is an unfair or deceptive trade practice for a small loan lender to make a small loan without providing the consumer a reasonable period of time to repay the loan. For the purposes of this rule, there shall be a rebuttable presumption that this standard is met if the loan does not require that it be repaid in full for at least four months, provided there is no prepayment penalty if the loan is paid off sooner.
E. It is an unfair or deceptive trade practice for a small loan lender to make a small loan with the knowledge that the borrower is likely to be unable to repay the loan, or to make the loan with the reasonable expectation of seizing the borrower's collateral.
F. It is an unfair or deceptive trade practice for a small loan lender to falsify, or encourage any prospective borrower to falsify, the borrower's credit application for a payday or car title loan.
G. It is an unfair or deceptive trade practice for a small loan lender to fail to clearly and conspicuously disclose orally and in writing a payday or car title loan's fees, charges, and payments.
H. It is an unfair or deceptive trade practice for a small loan lender to engage in an act or practice in connection with the offering of a small loan, where the borrower exclusively or primarily uses the proceeds of the small loan to re-pay another small loan.
I. It is an unfair or deceptive trade practice to require the purchase of credit insurance or an auto club membership as a condition to the making of any small loan by a small loan lender.
J. It is an unfair or deceptive trade practice for a small loan application form of the licensee to be preprinted to offer or provide financing for the purchase of credit insurance or auto club memberships. Any agreement to purchase credit insurance or auto club membership shall be separate from any small loan agreement, and must provide a disclosure which is either signed or initialed by the consumer acknowledging that he/she understands that the purchase of the credit insurance or auto club membership was in no way a condition or requirement for obtaining any loan from the small loan lender.
K. It is an unfair or deceptive trade practice for a small loan lender to submit a check received for payment of a small loan for deposit more than one time, or to create electronic checks for deposit and deposit such electronic checks or electronically debit the borrower's checking account after a check or electronic debit has been dishonored or returned for insufficient funds.
L. It is an unfair or deceptive trade practice for a small loan lender to charge application, document preparation, credit check or any fees other than a reasonable returned check or declined debit authorization charge.
M. It is an unfair or deceptive trade practice for a small loan lender to require payment of interest charges for the full term of the small loan if the small loan is paid off early.
N. It is an unfair or deceptive trade practice for a small loan licensee to require small loan terms that provide for payments against interest only. Payments on small loans shall include both interest and principal during the term of the small loan.
O. It is an unfair or deceptive trade practice to allocate payments during the term of the small loan so that a balloon payment is due at the last scheduled payment of the loan, i.e., payments against the principal balance of the loan shall be equally divided during the term of the loan.
[12.2.10.8 NMAC - N, 02/15/2006]
12.2.10.9 UNCONSCIONABLE TRADE PRACTICES:
A. It is an unconscionable trade practice for a small loan lender to engage in an act or practice in connection with the offering of a small loan which shocks the conscience or is exceedingly unfair, harsh or callous, such as when, given the circumstances, the terms of the loan place the borrower with a substantial and unreasonable risk of loss of the collateral while the lender assumes little or no risk of loss.
B. It is an unconscionable trade practice for a small loan lender to engage in an act or practice in connection with the offering of a small loan where the lender intentionally makes a loan for the purpose of seizing the borrower's collateral.
C. It is an unconscionable trade practice for a small loan lender to engage in an act or practice in connection with the offering of a small loan that takes unreasonable advantage of the small loan lender's superior knowledge and expertise or when there is no legitimate business justification for such a small loan and the lender knows that the borrower is especially vulnerable or is facing an emergency need for the small loan.
D. It is an unconscionable trade practice for a small loan lender to engage in an act or practice in connection with the offering of a small loan that takes unfair advantage of the borrower's relative education,
language skills, advancing age, clear inability to handle monies, or other factors that place the borrower at an unreasonable disadvantage.
E. It is an unconscionable trade practice for a small loan lender to engage in an act or practice in connection with the offering of a small loan that charges interest or other credit costs that are significantly excessive in comparison to other available loans, regardless of whether the interest and cost charges of the loan are otherwise lawful under state or federal credit statutes.
F. It is an unconscionable trade practice for a small loan lender to offer or make a payday or car title loan and:
(1) charge more than seven dollars fifty cents ($7.50) or ten percent of the amount loaned, whichever is greater, for the first thirty-day period of the loan; this charge shall not be made on the refinancing of an existing loan or credit transaction; a loan or extension of credit shall be considered to be refinancing of an existing loan if any part of the proceeds of the subsequent loan is applied toward the payment of a prior loan with the same small loan lender;
(2) for the remaining period of the payday or car title loan, including any refinancing, to charge directly, indirectly or by any subterfuge, a small loan charge in connection with any payday or car title loan transaction at a rate in excess of four percent per month on the unpaid principal balance of the loan or extension of credit; this shall be limited to a period of 12 months from the date of maturity of the loan; in total, this cap on interest equates to an average rate of 54% per annum: ten percent for the first month, followed by four percent for the subsequent eleven months; and
(3) to charge a rate in excess of ten percent per annum after twelve months from the date of maturity of the loan;
(4) the foregoing payday and car title loan charges are limiting maximums and nothing in this rule shall be construed to prohibit a small loan lender from contracting for or receiving a lesser rate.
G. It is an unconscionable trade practice for a small loan lender to require borrowers to waive the right to participate in a class action or jury trial, to seek punitive damages, to require waiver or release of pre-existing claims or causes of action arising from prior transactions, or avail themselves of any other form of legal redress.
H. It is an unconscionable trade practice for a small loan lender to fail to provide written translation of documents in the language in which solicitation(s) have been made or in which the transaction took place, or to fail to provide written verification that a full and complete oral translation of the contract was provided to the borrower for any transaction that took place in an oral (non-written) language.
[12.2.10.9 NMAC - N, 02/15/2006]
> >I received your fax suggesting we are operating illegally in your state and
> >while we do operate well within our rights in your state I am willing to
> >settle your loan to resolve your dispute. Your current balance is $610.71
> >as a result of your most recent transaction being an increase, which you
> >chose on 1/20/06, to $500.00. I am now willing to waive all fees and
> >finance charges to settle for the principal balance of $500.00 by 3/1/06.
> >Please let me know if you will accept this offer.
> >
> >
> >
> >Thank You,
> >
> >PayDay OK Account Service Team
> I do not accept the settlement offer state below.
>
> Being that I have already paid $596.23 in interest since the 07/12/04
> inception, and that the apr of 260.72% on a $500.00 loan is what The New
> Mexico Attorney General Parrica Madrid has deemed an "unconscionable trade
> practice", and The State of Michigan has defined since 1968 as "Criminal
> Usury", I request that my account be marked "paid in full." I will owe
> PayDayOK nothing more, nor will PayDayOK owe me any refunds.
>
> Please respond.
>
> Thank you,
>
>
> TITLE 12 TRADE, COMMERCE AND BANKING
> CHAPTER 2 CONSUMER PROTECTION
> PART 10 EXTENSION OF CREDIT FOR SMALL LOANS
> 12.2.10.1 ISSUING AGENCY: Office of the New Mexico Attorney General.
> [12.2.10.1 NMAC - N, 02/15/2006]
>
> 12.2.10.9 UNCONSCIONABLE TRADE PRACTICES:
>
> "F. It is an unconscionable trade practice for a small loan lender to offer
> or make a payday or car title loan and:
> (1) charge more than seven dollars fifty cents ($7.50) or ten percent of the
> amount loaned, whichever is greater, for the first thirty-day period of the
> loan; this charge shall not be made on the refinancing of an existing loan
> or credit transaction; a loan or extension of credit shall be considered to
> be refinancing of an existing loan if any part of the proceeds of the
> subsequent loan is applied toward the payment of a prior loan with the same
> small loan lender;
> (2) for the remaining period of the payday or car title loan, including any
> refinancing, to charge directly, indirectly or by any subterfuge, a small
> loan charge in connection with any payday or car title loan transaction at a
> rate in excess of four percent per month on the unpaid principal balance of
> the loan or extension of credit; this shall be limited to a period of 12
> months from the date of maturity of the loan; in total, this cap on interest
> equates to an average rate of 54% per annum: ten percent for the first
> month, followed by four percent for the subsequent eleven months; and
> (3) to charge a rate in excess of ten percent per annum after twelve months
> from the date of maturity of the loan;
> (4) the foregoing payday and car title loan charges are limiting maximums
> and nothing in this rule shall be construed to prohibit a small loan lender
> from contracting for or receiving a lesser rate."
You have paid a total to date of $583.09 and increased your loan to $500.00 as
recent as 1/20/06, agreeing to the terms at that time. In a goodwill gesture we
will forgive the debt you owe Payday Ok considering the funds received to date
sufficient to close the loan.
Thank You,
PayDay OK Account Service Team
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http://www.legislature.mi.gov/
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polly
Site Admin
Joined: 02 Mar 2006
Posts: 1801
Debtcc Points: 22939
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| Posted: Thu Mar 16, 2006 2:30 pm Subject: |
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Way to go!!!! Woohoo!!!
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emsbchristy
Joined: 21 Feb 2006
Posts: 37
Debtcc Points: 1877
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| Posted: Thu Mar 16, 2006 2:45 pm Subject: |
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You go girl, between you and mishele these guys do not stand a chance
_________________
Life is a journey down a road filled with many twists, truns and forks. the destination is not important... the journey is what makes life precious.
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jj
Moderator
Joined: 24 Oct 2005
Posts: 1047
Location: Washington State Debtcc Points: 8612
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| Posted: Thu Mar 16, 2006 2:55 pm Subject: |
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I agree, JJ! This gal is one fire  I never knew about usury laws before, Polly is check into this for my state for me. I do a letter that is similar to this but I use information from the division of financial instititutions that is in regards to the check cashing act, it states a lender must be licensed in order to do business with an ohio consumer, if not that it is not allowed or illegal as I state, and some of these lenders state it does not pertain to them but store front lenders. This is just not true in most states.
_________________
RYDERS OF THE NIGHT
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CowampChicken
Joined: 20 Dec 2005
Posts: 3681
Debtcc Points: 36192
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| Posted: Thu Mar 16, 2006 3:15 pm Subject: |
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In each state there are some agencies that regulate the licensing, bonding or registration of a company and determine that the company is doing business lawfully. It is encouraged to check with such agencies like the Department of Financial and Professional Regulations and know the licensing of a company.
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david
Debt Samaritan
Joined: 04 Jan 2006
Posts: 1269
Debtcc Points: 30164
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| Posted: Thu Mar 16, 2006 3:26 pm Subject: |
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you guys are going to make a girl *blush*
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polly
Site Admin
Joined: 02 Mar 2006
Posts: 1801
Debtcc Points: 22939
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| Posted: Thu Mar 16, 2006 3:33 pm Subject: |
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and girl, you are encouraging us guys and the community members towards a strong move.
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david
Debt Samaritan
Joined: 04 Jan 2006
Posts: 1269
Debtcc Points: 30164
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| Posted: Thu Mar 16, 2006 4:23 pm Subject: |
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How can you find out this information for your state.I have paid them over $1200 in interest on my $500 loan.I kept renewing it for a year.Thanks
_________________
"No amount of time can erase the memory of a good cat, and no amount of masking tape can ever totally remove his fur from your couch." Leo Dworken
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twokidtwocat
Joined: 31 Jul 2005
Posts: 627
Debtcc Points: 37813
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| Posted: Fri Mar 17, 2006 4:19 am Subject: |
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Polly is doing a great job and will be a great help in the forums Twokid, check with your state's department or division of financial institutions to see if they regulate payday loans in your state. You can probably access this information on the internet as well as find out if a company is actually licensed to loan money in your state. This is what I have been doing for the few months and it has worked in my favor.
_________________
RYDERS OF THE NIGHT
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CowampChicken
Joined: 20 Dec 2005
Posts: 3681
Debtcc Points: 36192
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polly
Site Admin
Joined: 02 Mar 2006
Posts: 1801
Debtcc Points: 22939
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| Posted: Fri Mar 17, 2006 9:55 am Subject: HELP with Payday Loans |
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I've done it. I live in Mass, and have payday loans with: Magnum Funding ($500), Sonic Payday ($1000), AmericaCash Advance ($1000), Mr. Cash ($300), Apple Payday ($650) and Payday Connection ($850).
I had payed off some of the loans before the holidays, but quickly got behind the eight ball and went back to the "old faithful" method. I realize now what a mistake I've made.
I am now in at a point that my entire paycheck is going to the interest on these loans. At Magnum, I actually was due to pay them off this payday, but it was returned and now they've extended it, including fees, until 4/15 for two debits of $245.
Is there anything I can do here? I don't know how to get out of this. I have an infant at home and am scared. Has anyone been in this situation? Is there any recourse for someone who has made such a horrible mistake? Is bankruptcy an option?
Someone, please give me sound advice! I am desperate to know what I can do!
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scaredsillybydebt
Joined: 17 Mar 2006
Posts: 9
Debtcc Points: 4874
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| Posted: Fri Mar 17, 2006 9:59 am Subject: |
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scared,
Just stop paying them. You can't do it. Find out what the laws are in Mass. Find out if these companies are licensed in the states that they operate, and write letters.
Don't let them bully you. You need to provide for your baby. trust me...I've been there.
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polly
Site Admin
Joined: 02 Mar 2006
Posts: 1801
Debtcc Points: 22939
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| Posted: Fri Mar 17, 2006 10:19 am Subject: |
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Scared to follow up with what Polly says, before your next payments are due, talk with your bank and change your account numbers (close existing checking and open new one. Once you have protected your paycheck then you can decide how to deal with the calls that will follow. I recommend that you sned each and everyone of your lenders a letter stating your circumstances and that you would like to make payment arrangements. Do not offer any money at first, wait and see who is willing to work with you. the strategy I used was to payoff the most willing to work with me first and then take care of the rest one at time. It took me 18 months to payof nearly 5K. I was fairly lucky in that I had a decent income at the time and it increased as time went on. However I still ahd to stick to a budget. The key is to only agree to pay what you can afford. Most lenders trty and get their money back as fast as possible, and will generaly try and get you to pay more that you can afford. don't cave in.. stay strong.. ignore threats of criminal action.. they can't do that...
Also, here a a few numbers I have found where you might be able to get some free legal assistance
Massachusetts Bar Dial-a-Lawyer
617-338-0571
Legal Advocacy and Resource Center
1-800-342-LAWS
Western MA Volunteer Lawyers Service
1-800-639-1209
Most importanly scared, remember your not alone, alot of us have been down this road and we will all do our best to help you.
take care
_________________
Life is a journey down a road filled with many twists, truns and forks. the destination is not important... the journey is what makes life precious.
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jj
Moderator
Joined: 24 Oct 2005
Posts: 1047
Location: Washington State Debtcc Points: 8612
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| Posted: Fri Mar 17, 2006 10:23 am Subject: |
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You have all been so helpful! It's ironic -- I may a great living, and just got in way over my head. Everything is behind, and I haven't even tackled the payday loans.
I will call the Lawyers today!
Thank you, thank yoU!!
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scaredsillybydebt
Joined: 17 Mar 2006
Posts: 9
Debtcc Points: 4874
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| Posted: Fri Mar 17, 2006 10:27 am Subject: |
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I can understand that. Start with the important stuff like car payment, house payment/rent... maybe even look into a debt consolidation program (not loan)
_________________
Life is a journey down a road filled with many twists, truns and forks. the destination is not important... the journey is what makes life precious.
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jj
Moderator
Joined: 24 Oct 2005
Posts: 1047
Location: Washington State Debtcc Points: 8612
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| Posted: Fri Mar 17, 2006 10:31 am Subject: |
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That is my plan. I hope that I can work this out...
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scaredsillybydebt
Joined: 17 Mar 2006
Posts: 9
Debtcc Points: 4874
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