How is Cashnet USA operating legally in Florida?
Date: Mon, 12/01/2008 - 12:29
Maybe I am missing something, but I don't believe that CashNet USA is legally operating in Florida. The loan documents have a company called Cash America Net as a CSO charging a fee of $70.00 to get you a loan. The loan is through NCP Finance of Florida. Over five months I paid CashNET USA $800 on this same loan (which was for $500).
The only entity they are registered as in Florida is a payday or "deferred presentment" provider, but the transaction did not follow any of the rules which govern deferred presentment providers. The legal interest rate in Florida is 18% per annum. Obviously, the amount of money I paid on this loan far exceeds that. The promissory note states the interest rate as 18% per year but the Truth in Lending Disclosure lists it at 385.52% apr.
Why does everyone seem to think they are operating legally in Florida?
The only entity they are registered as in Florida is a payday or "deferred presentment" provider, but the transaction did not follow any of the rules which govern deferred presentment providers. The legal interest rate in Florida is 18% per annum. Obviously, the amount of money I paid on this loan far exceeds that. The promissory note states the interest rate as 18% per year but the Truth in Lending Disclosure lists it at 385.52% apr.
Why does everyone seem to think they are operating legally in Florida?
Because they are. CSO model is a form of payday lending used in
Because they are. CSO model is a form of payday lending used in Florida, Texas and Maryland. Usually it's done in stores but it also happens on the internet. Basically, one entity is the lender and it charges you the maximum legal rate for an unlicensed lender in your state. A second entity - in this case CashNetUSA - acts as a loan broker. They arrange the loan and give the lender a guarantee of payment. They also charge you a "brokering" fee that is not capped by state law.
