| Author |
Message |
|
|
 Posted: Tue May 20, 2008 1:00 pm Subject: Rollovers
|
|
|
Are rollovers the same as refinancing? I live in FL and I know rollovers aren't allowed, yet all three of my Internet payday loans have refinanced.
PayDayOne: $500, paid $113 so far
CashCentral: $300, paid $181 so far and they've told me since my payment from my closed bank account was sent back to them, I owe them another $80-something
CashNetUSA: $700, paid (I think) $200-something
If refinancing isn't allowed, what do I tell the companies? I've sent something through e-mail to PayDayOne and CashNetUSA, but haven't gotten anything back.
|
|
unabridged81
Joined: 06 May 2008
Posts: 4
Debtcc Points: 96
|
|
|
 |
|
Posted: Wed May 21, 2008 4:36 am Subject:
|
|
|
No Rollovers and Refinancing are completely different thing. Rollovers are applicable for Payday Loans.
What is Rollover of Payday Loan?
Suppose you have taken Payday loan of $100. As a fee you have to pay $25 (say). Now, if you fail to repay the loan within the prescribed time period then you can extend the payment time by paying an additional fee of $25. This is known as rollover. Here, the total cost for rollover will be $150.
|
|
phoenix
Joined: 14 May 2008
Posts: 928
Debtcc Points: 5999
|
|
|
|
Posted: Wed May 21, 2008 6:58 am Subject:
|
|
|
All three of the companies you are dealing with are not payday loans in Florida. They are Credit Service Organizations.
| Quote: | What is a CSO Credit Services Organization
In essence, a CSO or Credit Services Organization is defined by the Texas Credit Services Organization Act (Section 393 of the Texas Finance Code) as an entity or person that provides one of the following services:
Improving a consumer's credit history or rating
Obtaining an extension of consumer credit for the consumer
Providing advice or assistance to a consumer regarding the previous two services
An important aspect of the CSO or Credit Services Organization model is that there IS NO LICENSING required by the state! CSO's are required to "REGISTER" with the Secretary of State, they are NOT licensed, AND THEIR FEES ARE NOT REGULATED.
How does the CSO Credit Services Organization work with payday loans?
The CSO Credit Services Organization operates as a broker, much as they did when partnering with the banks (payday loan bank model). The Texas Credit Services Organization Act (CSOA) allows the payday loan lender to register as a CSO and act as a loan broker. Thus, the CSO, previously a payday loan company, can make loans via consumer lending companies that are UNREGISTERED and UNLICENSED. The CSO Credit Services Organization acts as a broker for the consumer in need of funds by issuing a "letter-of-credit" on behalf of the consumer to a lender. This third-party unregistered lender funds the "loan" brokered by the CSO "broker".
Typically the CSO Credit Services Organization collects 3 fees:
A referral fee for referring the consumer to the unregistered, unregulated lender that actually funds the "loan". This is not stipulated by any law but is currently $20 to $30 per $100
An application fee for filling out the CSO documents; typically $10 per $100
The interest on the "loan"; Texas state law caps this at $10 per $100.
The CSO Credit Services Organization model arises from a U.S. Fifth Circuit Court of Appeals opinion, in Lovick vs. Rite Money, which held that payments to a registered CSO loan broker could not be treated as interest. |
All three companies you are dealing with are registered as CSO's in Florida.
They are exempt from the payday loan laws of Florida, since they are not payday loans. They would not be exempt from the interest rate cap, but since Federal Law says their fees can't be considered interest, they charge a large fee and very little interest to stay under the cap.
| Quote: | | In Florida, PayDay One Express of Florida, LLC ("PayDay One") is a Credit Services Organization registered with the Florida Department of Financial Regulation. We are not a lender, and cannot promise that the lender will extend credit to you. The lender makes loans at 18% per annum simple interest. We are obtaining an extension of consumer credit for you from the lender. For this service, PayDay One charges a fee of $22.50 per $100 of the Amount Financed. |
| Quote: | CashNetUSA will not be the lender for loans received at this site. CashNetUSA is a Credit Services Organization. We will attempt to arrange a loan between you and a third party lender and service that loan once it is issued. Any questions, service issues or complaints about your loan will be addressed by CashNetUSA and not the lender.
Your Credit Services Organization fee will be $14.00 per $100 borrowed. You will also be charged interest by your lender of 18.00% apr on loan principal and CSO fees. The chart below displays the Credit Services Organization fee and the interest combined to determine the Annual Percentage Rate. |
| Quote: | | The CSO fee of $25.00 per $100 loaned is applied as a service remittance for Cash Central assistance in connecting you with a lender and providing the support you need as your Credit Service Organization. You will also be charged interest by your lender of 18.00% APR on loan principal and CSO fees. The chart above displays the Credit Services Organization fee and the interest combined to determine the Annual Percentage Rate. |
_________________
How I make some extra cash
I earn at least $20 extra every month doing offers. And you don't have to pay a cent.
|
|
goudah2424
Moderator
Joined: 31 Oct 2006
Posts: 8007
Debtcc Points: 111635
|
|
|
|
Posted: Wed May 21, 2008 7:04 am Subject:
|
|
|
| Quote: | Detail by Entity Name
Foreign Limited Liability Company
CASH AMERICA NET OF FLORIDA, LLC
Filing Information
Document Number M06000003392
FEI Number 205921254
Date Filed 06/16/2006
State DE
Status ACTIVE
|
| Quote: | Detail by Entity Name
Florida Limited Liability Company
CASH CENTRAL OF FLORIDA, LLC
Filing Information
Document Number L05000060972
FEI Number 203036506
Date Filed 06/20/2005
State FL
Status ACTIVE
Last Event LC NAME CHANGE
Event Date Filed 05/24/2007
Event Effective Date NONE |
| Quote: | Detail by Entity Name
Foreign Limited Liability Company
PAYDAY ONE EXPRESS OF FLORIDA, LLC
Filing Information
Document Number M07000003078
FEI Number N/A
Date Filed 05/23/2007
State DE
Status ACTIVE
|
Those are the registrations for each of the companies.
They are all 100% legal in Florida.
_________________
How I make some extra cash
I earn at least $20 extra every month doing offers. And you don't have to pay a cent.
|
|
goudah2424
Moderator
Joined: 31 Oct 2006
Posts: 8007
Debtcc Points: 111635
|
|
|
|
Posted: Thu May 22, 2008 12:11 am Subject:
|
|
|
Dear Goudah and Unabridged,
I was not aware of CSOs before going through your posts. But I have certain questions regarding this: -
1. When a person is taking any sort of payday loan through a CSO, then what is the process of making payment? --- is it lump sum and one time, as in case of a normal payday loan, or partial or through monthly payment?
2. In the first post done by Unabridged you can see that he has taken three loans from 3 different CSOs. But in each of them he has made partial payment---How is it possible? So, what is the repayment pattern?
3. If a person gets loan through a CSO, then does the borrower make payment to the “unregistered” lender directly or through the CSO?
4. How does the reference of Refinancing come here?
Regards,
Phoenix
|
|
phoenix
Joined: 14 May 2008
Posts: 928
Debtcc Points: 5999
|
|
|
|
Posted: Thu May 22, 2008 7:03 am Subject:
|
|
|
I will try to answer your questions as best i can.
1. It's just like a normal pdl, where you have the option of paying in full, or just paying the fee and extending the loan.
2. I don't believe he has made partial payment. I believe he has extended the loans numerous times. That would mean he only paid the fee, and would still owe the whole principle plus another fee. So the amounts he's posted as having paid are all fees to extend the loan, I don't beleive he has paid anything towards the actual principle of the loan.
3. When you take a loan from the CSO, the CSO handles the whole transaction. You never talk to the "lender", you don't even know who the "lender" is. Everything goes through the CSO.
4. Refinancing/rolling the loan over is illegal for Payday Loan companies to do in Florida. But CSO's are not pdl's, and do not have to follow those laws. They have their own set of very short laws they must follow, which pretty much lets them do as please.
CSO's do have to adhere to state laws capping interest rates. But federal law says that fees charged by a CSO cannot be figured in as interest, so they will charge a huge fee, and then only like 12% interest on the loan.
_________________
How I make some extra cash
I earn at least $20 extra every month doing offers. And you don't have to pay a cent.
|
|
goudah2424
Moderator
Joined: 31 Oct 2006
Posts: 8007
Debtcc Points: 111635
|
|
|
|
Posted: Thu May 22, 2008 9:49 pm Subject:
|
|
|
Dear Goudah,
Thanks for your answers.
I have some other related questions too: -
1. How could I know that a company is a Payday loan Lender or a CSO? What are the things shud I verify regarding this?
2. What are the things should verify at the time of taking a short term loan from a CSO?
Regards,
Phoenix
|
|
phoenix
Joined: 14 May 2008
Posts: 928
Debtcc Points: 5999
|
|
|
|
Posted: Thu May 22, 2008 9:54 pm Subject:
|
|
|
Dear Goudah,
I have a confusion regarding CSO. Can you please help me to sort it out?
In your first post of this thread you had given a quote on CSO whose last line said: -
| Quote: | | The CSO Credit Services Organization model arises from a U.S. Fifth Circuit Court of Appeals opinion, in Lovick vs. Rite Money, which held that payments to a registered CSO loan broker could not be treated as interest. |
In your last post of this thread you said: -
| Quote: | | CSO's do have to adhere to state laws capping interest rates. But federal law says that fees charged by a CSO cannot be figured in as interest, so they will charge a huge fee, and then only like 12% interest on the loan. |
My confusions are listed below: -
1. Do the CSOs charge a lump sum amount from the borrower as fees, paid only once?
2. Is the CSO charges paid on a monthly basis?
3. If the payment is on a monthly basis, then is it a percentage of the total loan amount?
4. If it is a percentage amount, then is it not same as the Interest rate? If it is so then why is it not regarded as an Interest Rate?
5. You have said that CSOs and again said that | Quote: | | 12% interest on the loan |
.
i. Is the 12% a monthly rate or a yearly one?
ii.Is the payment done in a lump sum manner or monthly?
Thanx&Regards,
Phoenix
|
|
phoenix
Joined: 14 May 2008
Posts: 928
Debtcc Points: 5999
|
|
|
|
Posted: Fri May 23, 2008 7:33 am Subject:
|
|
|
Okay, here's my answers 
1. It would say in your contract that the company was a Credit Service Organization.
2. Taking a loan from a CSO is just like getting a payday loan. Stay away from them, because you have even less consumer protections with CSO's then with payday loans.
_________________
How I make some extra cash
I earn at least $20 extra every month doing offers. And you don't have to pay a cent.
|
|
goudah2424
Moderator
Joined: 31 Oct 2006
Posts: 8007
Debtcc Points: 111635
|
|
|
|
Posted: Fri May 23, 2008 7:38 am Subject:
|
|
|
1. No, for instance in Florida, they charge a fee of $25 per $100 borrowed, and 12% interest. You would pay this fee everytime you extended your loan.
2. The CSO is usually paid like a payday loan, on your pay dates.
3. Nope, the options are usually to pay the fee and extend the loan, pay it off in full, or pay the fee and a percentage of the loan to pay down the balance.
4. See #3
5. The interest rate is for the year. The payment is done just like a payday loan, where the balance is due in full, or you can pay the fee and extend the loan.
When i say they charge a huge fee and 12% interest (as an example), I mean that they charge like $25 per $100 borrowed as a fee, then 12% interest (over the year) for a 2 week loan. The interest is only a few cents, but the fee is huge.
They use the federal case to get around interest rate caps. Since their fees cannot be considered interest, they have a large fee.
_________________
How I make some extra cash
I earn at least $20 extra every month doing offers. And you don't have to pay a cent.
|
|
goudah2424
Moderator
Joined: 31 Oct 2006
Posts: 8007
Debtcc Points: 111635
|
|
|
|
Posted: Sat May 24, 2008 1:16 am Subject:
|
|
|
Thank you Goudah for all your answers.
Thanks a Ton.
|
|
phoenix
Joined: 14 May 2008
Posts: 928
Debtcc Points: 5999
|
|
|
|
|
|
All times are GMT - 7 Hours
|
| Page 1 of 1 |
|
