payday loans in PA

Payday loans are prohibited in PA. No lenders are legally allowed to offer loans to the consumers. If you see this happening, report to the Pennsylvania Department of Banking. Their website is

http://www.banking.state.pa.us/banking/site/default.asp

Send a copy of your complaint to the AG of your state at http://www.attorneygeneral.gov/

So what your saying is Payday loans are illegal in the state of Pennsylvania if the consumer lives in PA.

I currently have four payday loans. I have had good experiences with some and not so good with others. What can I do?

I am contacting all of them myself right now informing them that these loans are illegal. A couple of them I have paid more in interest than the principal and I will be demanding they mark them paid in full. The other two I am contacting telling them I am no longer authorizing them to deduct from my account and giving them notice of my plans to pay back the original principal. The only trouble I am having is finding the actual law code for this in PA's website. I know Polly has the links for most states but PA is impossible to find. If anyone knows it please direct me to it or if I find it I will post it on here for everyone else.

Post your questions to the Consumer Services Division at this link. You will get the info on payday loans prohibited in your state.

http://www.banking.state.pa.us/banking/cwp/view.asp?a=1350&q=546528&bankingNav=|32124|

Better check the Department of Banking website. ArDeN is wrong. Pennsylvania is an anomaly. Storefront lending is illegal (just ask Advance America, who is currently being sued by the Department for an "alternate" product they offer), but lending over the internet remains legal.

According to four different interpretive letters put out by the Department since 1999 (the most recent in June 2005) the Consumer Discount Company Act does NOT apply to out-of-state lenders that are licensed and operating in other states. In other words, Pennsylvania interprets its ban on payday loans to apply only to businesses within Pennsylvania. (Similar to Louisiana and Minnesota's policies that focus on the lender, rather than the borrower.) Recent attempts to amend the law (to focus on the borrower's residence) never came up for a vote in the Legislature.

Here's a link to the most recent letter that I'm referring to. http://www.banking.state.pa.us/banking/lib/banking/laws_and_regulations/062405.pdf

The pertinent part reads, "Since the Company will not have any offices of any kind in Pennsylvania or people physically present in Pennsylvania acting as principal, employee, agent or broker as those terms are contemplated in Section 3 of the CDCA, the Company is not ???????in this Commonwealth??????? as that term is used in Section 3 of the CDCA. Therefore, it is the position of the Department that the Company is not required to obtain a license under the CDCA in order to originate unsecured consumer loans via the internet to Pennsylvania residents. This position is conditioned upon the Company being licensed or otherwise authorized under the Company????????s home state law to engage in this type of lending activity."

The Department of Banking itself tried to get this law amended this past summer, by asking the Senate Banking and Insurance Committee to amend a related bill regarding NSF fees. The committee did not do so.

My fault. I said ArDeN was wrong. I was actually referring to BuildingWealth's post. Sorry.

In PA if the pdl is licensed in their state then they are legal to lend in PA. Is that right? You may luck out because I have found with some of my internet pdls that they are not even licensed in the states they claim to be in, so maybe you will find some luck and discover they aren't licensed in their "home state". Marica, so would this PA resident have some luck if this turns out to be the case? Curious.

Marcia, I was just thinking long on my post before I saw your second post.

LOL, I was just thinking what happened on that one? :) Anyways..

Absolutely, Steelers1. If the loan isn't legal somewhere, it can't be legal anywhere. Based on Carter Frantz' letter, I'm sure that's the position the DOB would take. Believe me, I've talked to Carter and others at the Department on behalf of some of my clients. They aren't the least bit happy about payday loans, but for the moment their hands are tied vis-a-vis LICENSED lenders. (Unlicensed is fair game. In fact, they're suit against Advance America is for UNLICENSED lending in PA, albeit in storefronts rather than on the net.)

BTW - Even if the lender is licensed, that doesn't mean its practical for them to take action against a Pennsylvania resident. The costs of an interstate collection action would still outweigh the benefit of collecting on a $300 loan. So I bet a deal could be made. (In fact, I bet so much on that that I dropped all my lender clients and reorganized my law firm - which is in PA - to exclusively do consumer debt settlement for pdl borrowers.)