This is the email that I just got from SJM Marketing:
I get this form letter several times a week, just with the name of the state changed. Could you tell me if this is a form you found on the internet or if some debt consolidation company gives you this and claims it will let you ignore the terms of your loan? Because it doesn't.
The laws of your state do not apply to your loan. You took out the loan on the internet and agreed to abide by the laws of Nevis West Indies (please see page four of your loan contract).
Also, your very first due date for the loan was rejected by the bank for insufficient funds. You haven't made any payments at all on this loan, unless our attempt to redebit yesterday actually cleared. Please be aware that taking out a loan with the knowledge that you are unable to fulfill the terms is fraud.
The above email was in response to this email that I had sent:
After doing research on internet payday loan laws in the state of NEW YORK, I have found that your internet payday loans are actually illegal. I have also found the following laws to be true applying to payday loans in the state of NEW YORK in general:
New York State Information
Legal Status: Prohibited
Licensed lender law applies but interest rate is that agreed to by contract. N.Y. Banking Law Ã‚Â§ 340 et seq. A check casher licensee cannot make loans nor cash or advance any moneys on a post dated check unless it is a payroll check. N.Y. Banking Law Ã‚Â§ 373. Criminal law sets the usury cap at 25%. N.Y. Penal Code Ã‚Â§ 190.40.
Small Loan Rate Cap
25% per year
Where to Complain, Get Information:
Regulator: New York State Banking Department
Address: One State Street New York NY 10004
Regulatory Contact: Regina A. Stone Deputy Superintendent
Your company should actually not issue loans to NEW YORK residents at all as you are not licensed in NEW YORK.
I have contacted the NEW YORK Office of Financial Institutions and the NEW YORK State Attorney GeneralÃ¢â‚¬â„¢s Office regarding your internet payday loans and was informed they are indeed illegal in NEW YORK and was advised to pay what is due according to principle amount only of the loan.
The legal amount that could have been charged to my loan is the principal amount of $300.00 even if your internet pay day loan was legal in NEW YORK. I only owe $300.00 to have this paid in full as your company has exceeded the maximum loan amount and has exceeded the maximum finance rate and fees. I am willing to pay the amount of $300.00 to pay the principle amount of the loan only, as advised by my Department of Financial Institutions and my state Attorney General's office.
I demand a physical address to mail payments to, as you are no longer authorized to debit my bank account. You must provide me with a physical address to mail my payments. I will not Money Gram or Western Union any payment. If no physical address is provided for me to mail payment to, no payment will be made.
I demand that any contact be made through US Postal mail or email only. I will need everything in writing to keep accurate records of all communication as per instruction from my state Attorney General's Office.
I prohibit you or your affiliates to contact me via telephone at my place of employment or my home telephone number. I also prohibit you from calling my references listed on my loan. Once I inform you of this, you must stop the telephone contact immediately or you will be once again breaking the laws of the state of NEW YORK.
You are also hereby notified that I am revoking any voluntary wage assignment I may or may not have signed. I no longer authorize you, your company, or your affiliates to attach any part of my wages or contact my employer for your collection purposes.
I am revoking your right to debit my checking account any longer. You, your company, or your affiliates are not authorized to debit my checking account at all. Please be aware that I have informed my financial institution of this situation and they will also be receiving a copy of this correspondence. Any further attempts at debiting my account will be rejected by my financial institution.
I must also inform you that I have filed complaints with the Better Business Bureau, the Federal Trade Commission, and my state Attorney General's Office.
I expect a response from your company no later than 08/28/08, regarding this matter. This response may only come via US Postal mail or email. No telephone contact is permitted.
By signing up a debt counseling session, your provided details (Name, Email ID and Phone No.) will be forwarded to the company advertising on the DebtCC. However, you have no obligation to use their services.
Some creditors and collection agencies refuse to lower the payoff amount, interest rate, and fees owed by the consumer.
Creditors/collection agencies can make collection calls and file lawsuits against the consumers represented by the debt relief companies.
Debt relief services may have a negative impact on the consumer's creditworthiness and his overall debt amount may increase due to the accumulation of extra fees.
The amount which the consumer saves with the use of debt relief services can be regarded as taxable income.