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 Posted: Fri Nov 24, 2006 2:51 pm Subject: AZ NM and NV? |
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Why am I seeing a trend of these payday loan company address's in these states, are their laws so lax that it makes it easy for these predators to set up shop in the state?
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PDLFREE
Joined: 07 Oct 2006
Posts: 1264
Debtcc Points: 18243
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| Posted: Fri Nov 24, 2006 3:05 pm Subject: |
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This reminds me of the post I read sometime back. Credit card companies in Delaware and South Dakota have rules in their favor. They don't have to follow the laws in the borrowers' state. They are allowed to charge any interest rate and fees while operating from their states. Virginia-Legal-Defense did a post on this subject.
http://www.debtconsolidationcare.com/political/extortionate-statute.ht ml
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ArDeN
Joined: 28 Jun 2006
Posts: 501
Debtcc Points: 6819
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| Posted: Fri Nov 24, 2006 3:08 pm Subject: |
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I was wondering the same thing??? I'll bet it has something to do with tax benefits. Somehow when they file their corporate annual returns, these states probably don't charge them as much tax.
Or maybe the companies are run on an indian reservation...
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DebtCruncher
Moderator
Joined: 07 Nov 2006
Posts: 1553
Debtcc Points: 17497
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| Posted: Fri Nov 24, 2006 5:49 pm Subject: |
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Tax benefits are the reason for Delaware incorporation. Many types of businesses are incorporated there (my mom runs a home based business but incorporated in Delaware for simple fact that Delaware is business friendly); the PDL's choose the other states for licensing because of the loose interest rate caps (which is totally legal); the trick for them is to comply with the state so their license doesn't get revoked. Many companies I have seen have a license for about a year. When they get the annual audit, the license gets revoked. TA DA!!
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Rach
Debt Samaritan
Joined: 10 May 2006
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