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Pay Day Loan Madness

Date: Thu, 10/23/2008 - 12:20

Submitted by bobbert0728
on Thu, 10/23/2008 - 12:20

Posts: 3 Credits: [Donate]

Total Replies: 13


I'm new to the site. I have a few outstanding PDL's. They were from the internet. I paid quite a bit to them, but they still say I owe because I paid interest only and did not pay them down. How do I know if any of them are illegal? If they are illegal, what can I do to stop it all? None of them are taking out of my current account. I switched banks once I realized they would not stop, no matter how much I contacted them or tried to make other payment arrangements. I'm in Michigan if that makes a difference.


Here are the law's for MI:

Quote:
[quote]Michigan State Information

Legal Status: Legal

Citation:
Mich. Comp. Laws 487.2121 et seq.

Loan Terms:
Maximum Loan Amount: $600
Loan Term: Max: 31 days
Maximum Finance Rate and Fees: 15% of first $100, 14% of second $100, 13% of third $100, 12% of fourth $100, 11% of fifth $100, 11% of sixth $100 + any database verification fee
Finance Charge for 14-day $100 loan: $15
apr for 14-day $100 loan: 390%

Debt Limits:
Maximum Number of Outstanding Loans at One Time: One with licensee or more than one with any other licensee
Rollovers Permitted: None (cannot renew; lender may extend only if it does not charge a fee)
Cooling-off Period:
Repayment Plan: Yes

Collection Limits:
Collection Fees: One $25 returned check charge
Criminal Action: Prohibited

Where to Complain, Get Information:
Regulator: Michigan Office of Financial and Insurance Services
Address: P.O. Box 30220 Lansing MI 48909
Phone: (877) 999-6442
Fax: (517) 335-4978


Emails to and from the Banking Dept:

From:
Sent: Wednesday, January 30, 2008 10:13 AM
To: Weigold, Mark W (DLEG)
Subject: Payday loan question

Hello,

Do internet based payday loan lenders with no physical location in Michigan need to be licensed by Michigan to lend legally to Michigan consumers? I am trying to help a friend with a huge mess. She has several internet payday loans, and they are saying that they only have to be licensed in their state, and that they can follow the laws of their state, not Michigan's laws. What is correct?

Thanks!

Response:

From: Weigold, Mark W (DLEG)
Sent: Wednesday, January 30, 2008 8:19 AM
To:
Subject: RE: Payday loan question

In response to your inquiry:

Being internet-based is not an exemption of Michigan statute. The location of the entity providing the payday loan (deferred presentment transaction in Michigan) does not create an exemption either. Based on your representation, a license is required to provide deferred presentment transactions in Michigan. Severe penalties may be incurred if an entity operates in Michigan without the requisite license.

Sincerely,

Mark W. Weigold, Manager
Consumer Finance Section
Office of Financial and Insurance Services
611 W. Ottawa Street
3rd Floor
Lansing, MI 48933
Business: 517/335-2073
Fax: 517/335-1501


What does this mean?

Internet lenders must be licensed by Michigan

Specific rates can be charged

No rollovers are allowed [/quote]


lrhall41

Submitted by dawnlango7 on Thu, 10/23/2008 - 13:03

( Posts: 1147 | Credits: )


More info:

Quote:

Quote:
You are only obligated to pay back the principal amount you borrowed from an unlicensed/illegal Internet Payday Lender.

What should you do?
Close your account asap, if you are unable to close your account, go into your bank and ask to speak with the Branch Manager, tell him/her you need a hard debit block placed on your account immediately! Explain that you are revoking ACH authorizations from unlicensed/illegal companies, and have learned these companies are notorious for ignoring revocation, therefore it is important to BLOCK any withdrawal attempts on your account to protect your interest. This is your privilege, do not accept no for an answer. The following link will provide you important information regarding closing accounts. CLICK HERE

What next?
AFTER your account is secure send each pdl (the unlicensed and illegal) an email similar to THIS (please scroll down to locate letter template). Tailor this letter to your needs, and try to write it with the same basic concept in your own words. You will need to research and locate email addresses/physical addresses if you don't already have them, I suggest that you type the name of the pdl (example: "oneclickcash address") in the search box in the upper right hand corner of this forum. You may also search for addresses HERE at the Better Business Bureau.

File complaints: Most of the time, you can file a complaint online with the following, I encourage you to follow through with doing so, you will need to search the Internet for your state Attorney General's website, however, here are links to file complaints for the FTC, Online complaints: Federal Trade Commission., and the BETTER BUSINESS BUREAU.

Keep in mind that you may not receive a response for days, or even weeks, or, you may receive harassing and threatening phone calls. I have found the best way to deal with this is not to respond or reply, simply hang up.

Side note: If you have paid an illegal/unlicensed payday lender above and beyond the principal amount you borrowed, it might be a good idea to demand a refund and a paid in full letter/receipt. You may or may not get one or both. It still doesn't hurt to include that tidbit in your letter.


lrhall41

Submitted by dawnlango7 on Thu, 10/23/2008 - 13:06

( Posts: 1147 | Credits: )


I have seen that many of the discussions state that "You are only obligated to pay back the principal amount you borrowed from an unlicensed/illegal Internet Payday Lender", however, can someone please provide a legal citation for this so that I can use it when I send letters to the various lenders.


lrhall41

Submitted by on Tue, 10/28/2008 - 10:30

( Posts: | Credits: )


Here are the laws for the state of California:

Legal Status: Legal

Citation:
Cal. Fin. Code ???????? 23000 to 23106

Loan Terms:
Maximum Loan Amount: $300
Loan Term: Max: 31 days
Maximum Finance Rate and Fees: 15% of check
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: One
Rollovers Permitted: None (cannot charge fee for extension)
Cooling-off Period: None
Repayment Plan: Voluntary (no fees may be charged in conjunction with payment plan)

Collection Limits:
Collection Fees: $15 NSF fee
Criminal Action: Prohibited

Where to Complain, Get Information:
Regulator: California Department of Corporations
Address: Financial Services Division, 1515 K Street, Suite 200 Sacramento, CA 95814
Phone: (866) 275-2677
http://www.corp.ca.gov/

With this in mind, you may want to check your bank statement to see if you have overpaid your lenders. Also you would need to check to see if your lenders are legal or not in the state of CA.


lrhall41

Submitted by wssu92 on Tue, 10/28/2008 - 16:29

( Posts: 510 | Credits: )