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Posted: Fri Mar 17, 2006 9:57 am Subject: Payday Loans have taken over my life

Posted: 17 Mar 2006 16:55 Post 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!

Posted: Fri Mar 17, 2006 10:09 am Subject:

Mass does not seem to have any payday lending legislation, however they do have a 20% cap on interest rates, and anything beyond that is considered usurious.

Find the exact legislation on Mass webisite, and copy it into a letter. Inform them that per WDPA (which you can find an excerpt of in one of my letters), that their claim of governing law is unsubstantiated. Also find out if these companies are licensed in the states that they are incorporated in. If they are not, which is highly likely, they are operating illegaly. You can do this!!!!

Guest · Posted: Fri Mar 17, 2006 10:11 am Subject:

Thank you for your advice. I am a bit scared to just stop paying. I do not want to be sued, or lose my job because they constantly harrass me at work.

Are there any companies that consolidate or negotiate with payday lenders?

Posted: Fri Mar 17, 2006 10:15 am Subject:

I think your fears are unfounded. Write these letters before your next payday and fax them. I have settled with every company except Cash Today. I had results within 24 hours after I faxed the letters. I actually got a refund from Rio Resources!
Store front lenders are more tricky, but these internet lenders 90% of the time are operating illegally.

Posted: Fri Mar 17, 2006 10:17 am Subject:

Polly -- That's the kind of gentle nudge I need! Can you offer me a bit more advice -- I am new on this site. Where do I go to find the legislation, and what letter do I use as a sample?

Posted: Fri Mar 17, 2006 10:20 am Subject:

http://www.mass.gov/legis/laws/mgl/271-49.htm

PART IV. CRIMES, PUNISHMENTS AND PROCEEDINGS IN CRIMINAL CASES

TITLE I. CRIMES AND PUNISHMENTS

CHAPTER 271. CRIMES AGAINST PUBLIC POLICY

Chapter 271: Section 49. Criminal usury

Section 49. (a) Whoever in exchange for either a loan of money or other property knowingly contracts for, charges, takes or receives, directly or indirectly, interest and expenses the aggregate of which exceeds an amount greater than twenty per centum per annum upon the sum loaned or the equivalent rate for a longer or shorter period, shall be guilty of criminal usury and shall be punished by imprisonment in the state prison for not more than ten years or by a fine of not more than ten thousand dollars, or by both such fine and imprisonment. For the purposes of this section the amount to be paid upon any loan for interest or expenses shall include all sums paid or to be paid by or on behalf of the borrower for interest, brokerage, recording fees, commissions, services, extension of loan, forbearance to enforce payment, and all other sums charged against or paid or to be paid by the borrower for making or securing directly or indirectly the loan, and shall include all such sums when paid by or on behalf of or charged against the borrower for or on account of making or securing the loan, directly or indirectly, to or by any person, other than the lender, if such payment or charge was known to the lender at the time of making the loan, or might have been ascertained by reasonable inquiry.

(b) Whoever, with knowledge of the contents thereof, possesses any writing, paper, instrument or article used to record a transaction proscribed under the provisions of paragraph (a) shall be punished by imprisonment in a jail or house of correction for not more than two and one half years, or by a fine of not more than five thousand dollars, or by both such fine and imprisonment.

(c) Any loan at a rate of interest proscribed under the provisions of paragraph (a) may be declared void by the supreme judicial or superior court in equity upon petition by the person to whom the loan was made.

(d) The provisions of paragraph (a) to (c), inclusive, shall not apply to any person who notifies the attorney general of his intent to engage in a transaction or transactions which, but for the provisions of this paragraph, would be proscribed under the provisions of paragraph (a) providing any such person maintains records of any such transaction. Such notification shall be valid for a two year period and shall contain the person's name and accurate address. No lender shall publicly advertise the fact of such notification nor use the fact of such notification to solicit business, except that such notification may be revealed to an individual upon his inquiry. Illegal use of such notification shall be punished by a fine of one thousand dollars. Such records shall contain the name and address of the borrower, the amount borrowed, the interest and expenses to be paid by the borrower, the date the loan is made and the date or dates on which any payment is due. Any such records shall be made available to the attorney general for the purposes of inspection upon his request. Such records and their contents shall be confidential but may be used by the attorney general, or any district attorney with the approval of the attorney general, for the purposes of conducting any criminal proceeding to which such records or their contents are relevant.

(e) The provisions of this section shall not apply to any loan the rate of interest for which is regulated under any other provision of general or special law or regulations promulgated thereunder or to any lender subject to control, regulation or examination by any state or federal regulatory agency.

Posted: Fri Mar 17, 2006 10:20 am Subject:

I found this in a different forum...does this mean that because I am a Mass. resident, online payday companies can not lend to me? If so, then maybe I have some recourse...

"After going through few online articles and browsing net vigorously, I have prepared the list of states that have banned payday loans. Check it-

Arkansas
Connecticut
Georgia
Maine
Maryland
Massachusetts
Michigan
New York
New Jersey
North Carolina
Pennsylvania
Vermont
West Virginia

Texas has set some limit of payday loans. It has capped apr and loan amount too.

However, payday lenders are still operating in these states as a partner of some out-of-state financial institutes. Few states have started working on these lenders specifically.

If anyone knows something more on this, please post it here. Thanks

Posted: Fri Mar 17, 2006 10:23 am Subject:

This is the link to one of my letters that I have wrote. If any on your company's are located in New Mexico, this will be a good letter to use, just replace the Michigan law with that of Massachusetts.

http://www.debtconsolidationcare.com/forums/paydayok-letter.html

Posted: Fri Mar 17, 2006 10:23 am Subject:

based on some info on the mass. state website, it may be or there maybe little restriction. I would contact the state attorney general's office and ask that simple question.

Posted: Fri Mar 17, 2006 10:36 am Subject:

So are you all saying that the lenders must adhere to the payday laws in the state in which we live and not in the state that they are located in or operate from?

Posted: Fri Mar 17, 2006 11:16 am Subject:

depends. In general more and more states are saying that their payday loan laws apply to anyone doing business with their residents... now the lenders will say that your contract stated that you agreed to abide by whatever laws are on the books in the state that they operate.. and guess what both are true.. you may have agrreed to something that is perfectly legal in your contract, but that does not necessarily mean that the loan it self is legal in your state.

raffi · Posted: Fri Mar 17, 2006 11:26 am Subject: letter to payday companies

pollyandsay I clicked on your link to view a letter and it said url not found any help would be appreciated on to write that letter.

Posted: Fri Mar 17, 2006 11:43 am Subject:

raffi,

it is in this forum, and it is called paydayok letter.

Posted: Fri Mar 17, 2006 11:45 am Subject:

Raffi,

The link is working nicely. Do you still have any problem watching this? Let us know.

raffi · Posted: Fri Mar 17, 2006 11:51 am Subject: letter

I got it but I am unsure of what parts to use and take out. Sorry for asking so many questions.

Posted: Fri Mar 17, 2006 11:54 am Subject:

raffi,

i posted a similiar letter in your ameriloan posting. take out the references to michigan, and replace it with florida law.

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