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how do you figure real apr on pdls  

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posted before about the pdls I had, I know according to NC it is supposed to be "illegal/prohibited" but these were internet sites, and I will be honest I am having a hard time finding any information whether they are legal or what. I have looked on SOS, AGO, and FTC.. so gray nothing is cut and dry.
so I looked on the CFA site, and it states NC pdl is prohibited, and that small loan rate cap is 36% per year.. so in pdl english how much interest should a 300.00 and 225.00 pdl actually cost to get?
I know one place it is 90bucks for 300.00 and 68.00 for the 225.
I have called the 2 places and left several messages, and no one has called me back I give up .. so when they do decide to call, and because my account is now blocked from all debits, I would like to find out if they are licensed in NC to do business or collect in NC, and what kind of arrangements can be made. I am not paying back any more than I borrowed in the first place. Someone said in a previous post not to worry about them trying to collect their money that in NC it is illegal to do pdl business, but I still borrowed the money , so I still have to pay it back right? though I can negotiate to pay back only what I borrowed right?


can anyone give me the scoop?
thanks!
 

asked Jul 23, 2007 12:29 PM

Anonymous

43Answers

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Bottom line is this: If a company is not licensed to do business in your state, and your state does not allow unlicensed business, then you legally do not have to pay it back. Morality is different from legality. You choose.

answered Jul 23, 2007 12:36 PM

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Technically, I'd say since they are illegal in NC, they aren't due any interest. That is the price they pay for knowingly doing illegal business.

But to calculate apr is as follows:

52 weeks in a year/2 = 26 pay periods

$90 fee x 26 pay periods = $2340

$2340 / $300 (amount of loan) = 7.8 x 100 (to get perecntage) = 780% APR

for the $225 loan it would be:

$68 x 26 = $1768

$1768 / $225 = 7.86 x 100 = 786% APR

answered Jul 23, 2007 12:37 PM

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You can always send out this letter via certified mail, to place the burden of proof on them:

Sample debt validation letter/ Cease and Desist Letter. Do not pay a collection agency any money without first sending this letter. If you have any questions, please contact Anthony.

answered Jul 23, 2007 12:39 PM

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ok but now, how do I find out if these companies are licensed to do business in NC? Half the time the name of the company isnt right, and like I said before I got to NC sec. of State , NC atty Gen and other NC gov sites, but I cant find any information about a-internet pdl or how to find licensed businesses such as pdl's .....

yea I would like to tell them to stick it.. just want to be with out a shadow of doubt sure .
I mean I had a pdl company take money out of my account with out my permission 2 wks ago that told me it was from a loan 3-4 yrs ago.. that claimed I owed them and they got my account # from me applying for pdls....I got the bank to give my money back but I still havent heard back from the bank to be sure that it is closed and done with.

I am just sorry I got these 2 loans, and I am just trying to get my credit and life together, tired of being a victim of the system... so to speak. =)

answered Jul 23, 2007 12:42 PM

Anonymous
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I like that letter, it looks like I can use that for some other collections I have been getting.. like Credit cards that I had only a 300.00 balance and after asking them to please close acct so that I would not rack up any more over the limit or late fees, they didnt and now I owe like 1000 bucks or more.. I mean I just told them stop calling me and disputed it through the 3 major credit bureaus but it didnt stop ...

so morally yes I owe these pdl but legally, I dont .. haha... that is too funny.

really.
I guess all I can do is wait for those collection letters, cause like I said , it may have said I borrowed money from one place but they say they are another.. like they all have 4-5 different names.

answered Jul 23, 2007 12:50 PM

Anonymous
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Only third party collection agencies have to respond to those types of letters. Not the original creditor.

None of these companies are going to be licensed in NC, since NC doesn't license pdl's. They are prohibited there. But if you don't pay them back principle, then you really aren't any better then these evil companies.

Be sure to file complaints with your state AG's office and dept of banking.

answered Jul 23, 2007 12:53 PM

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As Anthony stated, you can not pay them, but morally it wouldn't be right - even if you can get away with it legally. As goudah stated - if you don't pay them back at all, then you wouldn't be any better than the pdl's themselves. It's a situation where you need to decide. They are also illegal in my state. However, I paid them back according to my state law, if they were owed any more money. Most of them I overpaid. But that was my choice. And only because I felt as though I used the money, so I should pay it back. But not at what they were asking. I paid back the legal amount. You can get away with paying just the principle back. I have gotten refunds from a few pdl's where they refunded everything over the principle amount, because they knew they were illegal and shouldn't be charging those fees. So, it's your decision since they are illegal. I'm just giving my opinion and what I did. But, make sure you file complaints against these companies no matter what you decide. They are lending illegally to residents in your state. They need to have all complaints filed against them, regardless of your decision as to paying or not paying.

answered Jul 23, 2007 01:46 PM

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Yes, whatever you do please file those complaints! File file file!!!

answered Jul 23, 2007 01:47 PM

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No one needs to justify to us if you pay back money to an unlicensed company. So, if you follow the law, and do not pay them back, who are we to judge. I will tell you my personal opinion, I wouldn't pay them, and would I feel bad for it? No, even if someone would say I am as bad as the lenders themselves, so be it. Perhaps these crooks will begin to see that the consumers are getting informed, enough to take advantage of the situation.

answered Jul 23, 2007 03:39 PM

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Quote:

Perhaps these crooks will begin to see that the consumers are getting informed, enough to take advantage of the situation.


We will just have to disagree then. I don't think it's right to take advantage of a company just because you are informed. I think that works against the whole point of trying to shut down these companies, as they use examples like that of why they have to charge such high interest and fee and justify it by saying the people they lend to are such high risk for ripping them off. I just don't think that 2 wrongs make a right . . . .

answered Jul 23, 2007 03:47 PM

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