another request for help with pdls

Thank you for reading and being so well informed for you first post. This is going to be an easy one.

As you know you'll be blocking/closing your account, writing letters and filing complaints right? Well I can't say much for Bank of America but I guess if there is any other specific questions or if you need letters or such, just ask!

I can tell you that Cash Net USA and Cash Central are CSO's in Texas. This means that they dont' have to follow the normal payday loan laws. They are totally legal too.

The other ones are not likely to be licensed. This means that they are operating illegally.

Is there anyway to get your money out before the debit hits? If you have direct deposit, it will normally hit at midnight, so depending on your bank you may be able to at least withdraw some.

Another option would be to dispute the transaction with your bank. This can be risky though, because if the company has a signed contract they could still get their money. But it is a possibility.

I always say that the right thing to do is pay back what you borrowed. It's also the safe way.

Bank of America can be really bad about closing the account. The ACH's will reopen it. Read the sticky about closing your account and that will give you some more information.

Goudah - I have a question for you. When you say CashNet USA is a Texas CSO - what is that? I thought Cashnet was licensed in IL...And when you say they don't have to follow the normal PDL laws, what does that mean in terms of interest/fees? They can just do whatever??

Unfortunatly, yes . . . . A CSO means Credit Service Organization.

[quote]What is a CSO Credit Services Organization

In essence, a CSO or Credit Services Organization is defined by the Texas Credit Services Organization Act (Section 393 of the Texas Finance Code) as an entity or person that provides one of the following services:

*Improving a consumer's credit history or rating
*Obtaining an extension of consumer credit for the consumer
*Providing advice or assistance to a consumer regarding the previous two services

An important aspect of the CSO or Credit Services Organization model is that there IS NO LICENSING required by the state! CSO's are required to "REGISTER" with the Secretary of State, they are NOT licensed, AND THEIR FEES ARE NOT REGULATED.

How does the CSO Credit Services Organization work with payday loans?

The CSO Credit Services Organization operates as a broker, much as they did when partnering with the banks (payday loan bank model). The Texas Credit Services Organization Act (CSOA) allows the payday loan lender to register as a CSO and act as a loan broker. Thus, the CSO, previously a payday loan company, can make loans via consumer lending companies that are UNREGISTERED and UNLICENSED. The CSO Credit Services Organization acts as a broker for the consumer in need of funds by issuing a "letter-of-credit" on behalf of the consumer to a lender. This third-party unregistered lender funds the "loan" brokered by the CSO "broker".

Typically the CSO Credit Services Organization collects 3 fees:

1. A referral fee for referring the consumer to the unregistered, unregulated lender that actually funds the "loan". This is not stipulated by any law but is currently $20 to $30 per $100
2. An application fee for filling out the CSO documents; typically $10 per $100
3. The interest on the "loan"; Texas state law caps this at $10 per $100.

The CSO Credit Services Organization model arises from a U.S. Fifth Circuit Court of Appeals opinion, in Lovick vs. Rite Money, which held that payments to a registered CSO loan broker could not be treated as interest.
[/quote]
This means that because of the federal decision that allows any fees collected by CSO's to not count as interest, they can charge you a huge fee, and a small interest rate, and be perfectly legal.

Pretty much, they are not the actual lender. They are just servicing the loan for the real lender, who you never see.

Cash Net USA is licensed in almost every state it lends in, with the exceptions of Texas, Florida, and I think 1 other, where they are CSO's. They are registered with the Sec of State as a CSO in each of those states.

They were licensed in Oregon when I had to deal with them. So keep in mind that you will need to deal with them like a storefront. Since they are legally operating you need to work out something with them to get them paid, otherwise they can legally do things (legal things) to get it from you.

Ok, so is it possible to call each of these and work something out, or should I only do that with the CSO's? And how easy are they to work with when calling? I definitely would like to pay back what I originally borrowed as you suggested -- I have no intentions of not doing that.

It varies in how cooperative they will be. I would try to work something out with every company you still owe. The legal ones you would owe the whole balance, and the illegal ones you would owe what you borrowed, so principle only.

Yeah it gets complicated, since you have the CSO's. Like CashNetUSA for example, you have borrowed 1500, you will still have to pay back the 1500 plus fees, but if you call them and talk to them, hopefully they can put it into installments for you and you won't rack up any more fees. That is what the nice ones will do.

For the illegal ones you still owe, you are going to have a harder time getting them to accept the fact that you only owe them what is left on the principal borrowed, since collecting fees and all that is illegal if you are not licensed. So it might help to create a list sorting out the CSOs and the illegals, and then I'd start with calling and working something out with the CSOs first....