I've complied a list of all 50 states showing which state's require the company to be licensed by that state, and which one's allow other state's licenses.
** This is just preliminary *** There may be changes to it.
States that require internet based pdl's to be licensed by that state:
Alabama
Alaska
Arizona
California
Colorado
DC
Deleware
Florida
Hawaii
Idaho
Illinois
Indiana
Kansas
Kentucky
Lousiana
Maine
Michigan
Minnesota
Please see THIS LINK for changes in the MN law, updated on 7/7/2009 by Shazzers.
Mississippi
Missouri
Montana
Nebraska
Nevada
New Hampshire
New Mexico
North Dakota
Ohio
Oklahoma
Oregon
Pennsylvania (See article on the last page)
South Carolina
South Dakota
Texas
Utah
Washington
Wisconsin - If the online company solicited you
Wyoming
In the above states the internet payday loan company must be licensed by that state and follow that state's laws.
Posts: 1
Credits: 76.65 Send message to sunnystarr27
I live in new york and I have "HAD" a pdl in 2005 and paid on it and know they want $5000.00 in 2008 when I only borrowed $200.00
HELP ME!
If a lender is required to have a license but is not on the state's roster, does that mean it's illegal? What do I need to do if it is? I've got 11 payday loans and they eating me alive!
Posts: 7813
Credits: 122044.3 Send message to goudah2424
Licenses can be hard to find. The company may be licensed under a corporate name, or some other way.
I can't speak to general legalities. Everything depends on the specifics.
DSS - CSO's must still be registered with the Sec of State. It's a different process then licensing, but most states still have searchable databases of the registrations. Also, the contract will also state that the business is a CSO.
I earn at least $20 extra every month doing offers. And you don't have to pay a cent.
Posts: 106
Credits: 1239.85 Send message to drburr
Best you can do is to tell the company that you believe them to be unlicensed and force them to prove that they are (they need to be licensed at the time of transaction, btw).
If they give you a corporate name, or a d/b/a name, come back here and post it to assist other community members.
So If the company is not licensed what does that mean? I have loans with BIG, 247advance, Loanshop and FTR processing. Are these companies licensed in AZ? If not what can i do about the loans? I have already taken the first step and closed my bank account, but now I am freaked out abou that harrassing phone calls I am sure I will get.
There is a web site for the department of finacial institutes in the state of arizona ( won't let me post it here ). There will be a tab on the side that says " list of licenses "
I have been looking for certian internet based companies on there as well.
The only problem I can find is if they have a different name than the one they give you.
You can call the Department 602) 255-4421 or (800) 544-0708 to get more information about the companies as well as what you can do to stop them if they are indeed illegal.
what if they are not licensed? what does this mean?
Posts: 1071
Credits: 13535.9 Send message to DOLLARSandSINCE
Goudah, You might want to re-verify Kentucky. I talked with someone out of the Office of Finance here and they told me that a PDL company must have a state issued Kentucky license in order to loan in Kentucky. He then told me to get that license they must have one physical address that conducts PDLs as a business. He then stated that if they don't have a physical store then they don't get a license. In other words all internet PDL loans are illegal here unless they have a storefront to go along with it.
Posts: 7813
Credits: 122044.3 Send message to goudah2424
I know that - See
http://www.debtconsolidationcare.com/paydayloan/explain-pdls-laws.html
Kentucky Laws.
It doesn't change what I have on the first page, the company must be licensed. There is some crazy loophole that I haven't quite yet managed to put my finger on, but there are several companies that have licenses in every other state they can, yet they also lend in KY. Why would they bother to be legal in every other state, but not KY? So there is something missing.
Also, since technically they could have a storefront, it doesn't make all internet loans illegal.
I stand by my info.
I earn at least $20 extra every month doing offers. And you don't have to pay a cent.
Posts: 1071
Credits: 13535.9 Send message to DOLLARSandSINCE
At the very bottom of this post is a quote from the page that was linked. It looks like Cannr did some research on Kentucky laws. I am pretty sure Chris Thompson is the same fellow I spoke to about a year ago over the same issue. I am basing my response off of what he told me directly. A summary of what he said is to get a license in kentucky they have to have a physical store front in kentucky otherwise they are not getting a license. Essentially this makes all IPDLs illegal in Kentucky with the exception of the small number that have a storefront to go with it at least based on what he told me and what Cannr confirmed below. Technically you are correct that an IPDL could loan here but the catch is they need a store here to do it. The only thing I was suggesting was to move Kentucky to the list that says IPDLs are illegal and then put a qualifier that says they are legal if they have a store here. The reason I am suggesting this is because the percentage of IPDLs on the net that actually have a store in Kentucky is probably a very small number and the most notrious IPDL outfits are not licensed here.
Quote:
In my opinion the reason they get licenses in other states but not Kentucky is the same reason I posted above. Kentucky won't give them a license unless they open a store here. Frankly, Kentucky's PDL laws suck for the consumer and really are not much better than the deal you get from IPDLs. If I were an internet outfit I would partner with a storefront here to make it legal so I could cover my bases.
Quote:
Kentucky State Information
Legal Status: Legal (Applies to check cashers only)
Citation:
Kentucky Rev. Stat. Ann. ???? 368.010 et seq.
Loan Terms:
Maximum Loan Amount: $500
Loan Term: 14-60 days
Maximum Finance Rate and Fees: $15 per $100
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: Two ($500 aggregate loans outstanding to all licensees)
Rollovers Permitted: None (cannot renew, rollover, or consolidate)
Cooling-off Period: None
Repayment Plan:
Collection Limits:
Collection Fees: One NSF fee (if disclosed)
Criminal Action: Prohibited
Where to Complain, Get Information:
Regulator: Kentucky Office of Financial Institutions
Address: 1025 Capital Center Drive, Suite 200 Frankfort KY 40601
Phone: (800) 223-2579
Fax: (502) 573-8787
Regulatory Contact: Gary Davis,, Branch Manager
Emails to and from the banking dept:
To Whom It May Concern:
I have a question regarding internet payday lenders. I have visited the Department of Financial Institutions site and found some information. However, I am still a little confused.
I understand that storefront payday lenders are legal in the state of Kentucky and have printed out the laws applying to them. However, there is nothing regarding internet payday lenders.
I did a search on the site to see if some internet payday lenders were licensed in Kentucky. No results came up for any of them. If the case is that an internet payday lender is not licensed in the state of Kentucky, what then?
Internet payday lenders are claiming they do not have to comply with Kentucky state law. They claim they comply with the law in which they are located.
If they are not licensed in the state of Kentucky to fund loans, are they not in violation of some sort of law?
Any help in this matter would be greatly appreciated. At the very least, it might clear up my confusion.
Thank you so much for your attention in this.
Response:
Internet payday lending is illegal in Kentucky.
Chris Thompson
Compliance Branch Manager
Reply:
I have emailed before regarding internet payday lending and received the reply that internet payday lending is illegal in Kentucky. Thank you for that information.
I now have another question. If an agency is attempting to collect on an internet loan - which was illegally funded - does the collection agency need to be licensed in the state of Kentucky? Is this even a legal debt to collect on?
Thank you for any information you can give.
Response:
I am not sure who if anyone licenses collection agencies. This Office does not consider it a legal debt as the entity was not licensed to do business in Kentucky.
Chris Thompson
Compliance Branch Manager
Reply:
I have viewed our state pay day law and understand that a store front pay day loan company can collect one NSF fee if your check is returned by your financial institution.
However, I have a question. How many times can a pay day loan company run the check through to your financial institution?
I have a pay day loan company that I am working on setting up a repayment plan; however, they keep running the check through my financial institution every week.
I was under the assumption that pay day loan companies may run the check through only once; however, I could be misunderstanding.
Could you please clairfy for me how many times a store front pay day loan company can run your check through your financial institution? I would like to be sure this company is following the law.
Thank you in advance for any answers/advice.
Response:
There is nothing in the check casher statute that prohibits the number of times a pay day loan company can run the check through; however, it is my understanding that banking law on allows a bank to do it only twice.
Chris Thompson
Compliance Branch Manager
I've looked more into this, to see exactly why internet lending is "illegal" in KY
Ms. :
We have an Administrative Regulation in Kentucky 808 KAR 9:040 Limitation on electronic fund transfer from customers accounts that states: ???????In connection with a deferred deposit transaction, a license shall deposit or present for payment a customer????????s actual check to the customer????????s bank or other financial institution unless that check is redeemed or bought back by the customer.???????
This prevents Internet payday loans in Kentucky and any company that may be offering loans in Kentucky is doing so illegally. If you have any additional questions feel free to contact me.
Sincerely,
Rodney Gabbard
What does this mean?
A legal lender must hold a check from the customer.
Storefronts can charge you 15% of the face value of the check.
Rollovers are not allowed.
A big Thank You! to Cannr for providing this information!
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