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Payday Loan payments


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I've read a few times about payday loan places trying to draft multiple payments in the same day, over the course of several days, and so on.

 

No, I didn't take one out, this is just a question. Is it legal for them to do something like this? It seems to me that it could be argued this is intentionally harmful to the consumer. Just wondering if one would have legal recourse against a place that does this for willfully causing financial harm.

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I've read a few times about payday loan places trying to draft multiple payments in the same day, over the course of several days, and so on.

 

No, I didn't take one out, this is just a question. Is it legal for them to do something like this? It seems to me that it could be argued this is intentionally harmful to the consumer. Just wondering if one would have legal recourse against a place that does this for willfully causing financial harm.

it may be a violation of the EFTA

 

Electronic fund Transfer Act.

 

 

Electronic Fund Transfer Act (EFTA)/ Regulation E and Truth in Savings Act (TISA)

Payday lending arrangements that involve the opening of a deposit account or the establishment of "electronic fund transfers" must meet the disclosure and other requirements of both the EFTA and TISA. Examples include providing a device to access funds from a deposit account, or depositing a payday loan directly in a borrower's account and debiting the subsequent payment.

 

 

http://robertweed.com/2013/02/24/how-to-tell-your-bank-to-stop-payday-loan-withdrawals/

 

if payday loans are illegal in your state, so are online payday loans.

 

http://www.nytimes.com/2013/02/24/business/major-banks-aid-in-payday-loans-banned-by-states.html?_r=1&

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Interesting. I asked because CB gets people that pop up from time to time with horror stories about payday loan places trying to hit their account multiple times in the same day, or hitting it after they've been asked/told to stop.

 

It'd be nice if there was some legal recourse like you shared ICAN to refer these people to.

 

I also wonder how effective an email to their respective congressman or senator would be. Sharing a story of hardship only made worse by the actions of these places might prompt something. I know it worked for my wife and I. Wasn't a payday loan place, but the immigration office "lost" my wife's paperwork and application fee for renewal of her green card. Within 4 days of writing the email we had a sit down face to face meeting with the HMFIC of the area we were in, fees were waived, and delivery of the card was expedited. They even followed up to ensure we received it in a timely manner!

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I've read a few times about payday loan places trying to draft multiple payments in the same day, over the course of several days, and so on.

 

No, I didn't take one out, this is just a question. Is it legal for them to do something like this? It seems to me that it could be argued this is intentionally harmful to the consumer. Just wondering if one would have legal recourse against a place that does this for willfully causing financial harm.

it may be a violation of the EFTA

 

Electronic fund Transfer Act.

 

 

Electronic Fund Transfer Act (EFTA)/ Regulation E and Truth in Savings Act (TISA)

Payday lending arrangements that involve the opening of a deposit account or the establishment of "electronic fund transfers" must meet the disclosure and other requirements of both the EFTA and TISA. Examples include providing a device to access funds from a deposit account, or depositing a payday loan directly in a borrower's account and debiting the subsequent payment.

 

 

http://robertweed.com/2013/02/24/how-to-tell-your-bank-to-stop-payday-loan-withdrawals/

 

if payday loans are illegal in your state, so are online payday loans.

 

http://www.nytimes.com/2013/02/24/business/major-banks-aid-in-payday-loans-banned-by-states.html?_r=1&

 

Here is a list of states that either outright ban or highly regulate payday loans, according to wikipedia.

 

And a list of Usury laws by state, capping interest rates on loans.

Edited by prosumer
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Interesting. I asked because CB gets people that pop up from time to time with horror stories about payday loan places trying to hit their account multiple times in the same day, or hitting it after they've been asked/told to stop.

 

It'd be nice if there was some legal recourse like you shared ICAN to refer these people to.

 

I also wonder how effective an email to their respective congressman or senator would be. Sharing a story of hardship only made worse by the actions of these places might prompt something. I know it worked for my wife and I. Wasn't a payday loan place, but the immigration office "lost" my wife's paperwork and application fee for renewal of her green card. Within 4 days of writing the email we had a sit down face to face meeting with the HMFIC of the area we were in, fees were waived, and delivery of the card was expedited. They even followed up to ensure we received it in a timely manner!

Reason is.. chances are the Payday loan is illegal in the person's state and they don't care about state/federal laws. I've complained to my state agencies which have always gone on deaf ears unless it was a store front payday loan company. I still get calls from time to time from "collection agency's" and I use the term loosely because alot of the internet payday loans will use inhouse collections that will break every single FDCPA law under the book.

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  • 2 weeks later...

 

Reason is.. chances are the Payday loan is illegal in the person's state and they don't care about state/federal laws. I've complained to my state agencies which have always gone on deaf ears unless it was a store front payday loan company. I still get calls from time to time from "collection agency's" and I use the term loosely because alot of the internet payday loans will use inhouse collections that will break every single FDCPA law under the book.

 

 

If the Payday company is calling you directly, they are an original creditor, not a collector, and the FCRA applies, not the FDCPA.

 

Secondly, the readers digest version of how to deal with payday lender once you've determined you've had enough is:

 

a. Immediate Stop Payment and ACH block by your bank. It will cost $20 or so in fees. Do on the phone, follow with letter. It helps if you have a Credit Union or small bank, but it can be done with any bank.

 

b. Immediate Cease and Desist to the lender. No contact.

 

c. If you are dealing with any 3rd party collectors, immedaite C&D to them as well. No contact.

 

This will stop the bleeding. You'll still owe the balances.

 

When collections start, send a DV letter PLUS. Almost all internet payday lenders are: a. unlicensed and b. breaking state interest rate laws. In your letter, specicially ask for the interest rate of the original obligation, a break down of how each payment was applied including principal and interest, plus any fees, a copy of their Regulation Z notice, and a copy of the original note plus any terms/conditions. In most cases, this will be the end of it. They will not validate or attempt to validate. In the rest of the cases, they will attempt to validate without answering the interest rate quesition. After that, keep sending them a letter each time they send you a letter, or each time they call, asking what the interest rate is. If they report to the CRA without answering your basic question interest rate, immediately send an ITS, and then read up on small claims in your state.

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Reason is.. chances are the Payday loan is illegal in the person's state and they don't care about state/federal laws. I've complained to my state agencies which have always gone on deaf ears unless it was a store front payday loan company. I still get calls from time to time from "collection agency's" and I use the term loosely because alot of the internet payday loans will use inhouse collections that will break every single FDCPA law under the book.

 

 

If the Payday company is calling you directly, they are an original creditor, not a collector, and the FCRA applies, not the FDCPA.

 

Secondly, the readers digest version of how to deal with payday lender once you've determined you've had enough is:

 

a. Immediate Stop Payment and ACH block by your bank. It will cost $20 or so in fees. Do on the phone, follow with letter. It helps if you have a Credit Union or small bank, but it can be done with any bank.

 

b. Immediate Cease and Desist to the lender. No contact.

 

c. If you are dealing with any 3rd party collectors, immedaite C&D to them as well. No contact.

 

This will stop the bleeding. You'll still owe the balances.

 

When collections start, send a DV letter PLUS. Almost all internet payday lenders are: a. unlicensed and b. breaking state interest rate laws. In your letter, specicially ask for the interest rate of the original obligation, a break down of how each payment was applied including principal and interest, plus any fees, a copy of their Regulation Z notice, and a copy of the original note plus any terms/conditions. In most cases, this will be the end of it. They will not validate or attempt to validate. In the rest of the cases, they will attempt to validate without answering the interest rate quesition. After that, keep sending them a letter each time they send you a letter, or each time they call, asking what the interest rate is. If they report to the CRA without answering your basic question interest rate, immediately send an ITS, and then read up on small claims in your state.

in some states payday or small loan companies are regulated by the local state laws.

 

in Ohio, anyone working for these companies trying to collect a debt are considered debt collectors and have a list of prohibited actions that exactly mirror the FDCPA.

 

http://codes.ohio.gov/orc/1321.45

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Reason is.. chances are the Payday loan is illegal in the person's state and they don't care about state/federal laws. I've complained to my state agencies which have always gone on deaf ears unless it was a store front payday loan company. I still get calls from time to time from "collection agency's" and I use the term loosely because alot of the internet payday loans will use inhouse collections that will break every single FDCPA law under the book.

 

 

If the Payday company is calling you directly, they are an original creditor, not a collector, and the FCRA applies, not the FDCPA.

 

Secondly, the readers digest version of how to deal with payday lender once you've determined you've had enough is:

 

a. Immediate Stop Payment and ACH block by your bank. It will cost $20 or so in fees. Do on the phone, follow with letter. It helps if you have a Credit Union or small bank, but it can be done with any bank.

 

b. Immediate Cease and Desist to the lender. No contact.

 

c. If you are dealing with any 3rd party collectors, immedaite C&D to them as well. No contact.

 

This will stop the bleeding. You'll still owe the balances.

 

When collections start, send a DV letter PLUS. Almost all internet payday lenders are: a. unlicensed and b. breaking state interest rate laws. In your letter, specicially ask for the interest rate of the original obligation, a break down of how each payment was applied including principal and interest, plus any fees, a copy of their Regulation Z notice, and a copy of the original note plus any terms/conditions. In most cases, this will be the end of it. They will not validate or attempt to validate. In the rest of the cases, they will attempt to validate without answering the interest rate quesition. After that, keep sending them a letter each time they send you a letter, or each time they call, asking what the interest rate is. If they report to the CRA without answering your basic question interest rate, immediately send an ITS, and then read up on small claims in your state.

Already know this.. and 9 times out of ten you can't find a valid address for them. Been thre done that can write the book on it. Specially if the on-line payday lenders are overseas. Ditto on ITS good luck w/ that because most lawyers won't touch em because of them being overseas and not being able to collect their fees if they win.

Edited by beli
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Most of the payday lenders that act like the OP described are illegal online lenders, a majority of them are not even located in this country so they could really care less about the laws. Sending them a C & D and blocking the withdrawl is not going to do anything. They could care less about the c & d since they are operating illegally in the first place. They operate under multiple names so if you block them under one name they will go into your account under another name. The only option you have is close your account and, most of the time, move to another bank. I have heard stories of people opening another account at the same bank and the PDL finding them and hitting the new account. They do not operate within the law.

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Most of the payday lenders that act like the OP described are illegal online lenders, a majority of them are not even located in this country so they could really care less about the laws. Sending them a C & D and blocking the withdrawl is not going to do anything. They could care less about the c & d since they are operating illegally in the first place. They operate under multiple names so if you block them under one name they will go into your account under another name. The only option you have is close your account and, most of the time, move to another bank. I have heard stories of people opening another account at the same bank and the PDL finding them and hitting the new account. They do not operate within the law.

 

Same bank? I read one post from a guy who started a new job with an account at a NEW bank and they found that account and drained it. The good news was the bank credited the money back to him and blocked the company for an unauthorized EFT. The big question was how did they find the new bank account information.

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Most of the payday lenders that act like the OP described are illegal
online lenders, a majority of them are not even located in this country
so they could really care less about the laws. Sending them a C & D
and blocking the withdrawl is not going to do anything. They could care
less about the c & d since they are operating illegally in the first
place. They operate under multiple names so if you block them under one
name they will go into your account under another name.
 

The C&D and other stuff is not for the payday lender, it's for the bank (for you to contest the EFT), and later for the CRA, if you need to get stuff removed.

 

The worst of the worst can be dealt with, I've been there.

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Most of the payday lenders that act like the OP described are illegal
online lenders, a majority of them are not even located in this country
so they could really care less about the laws. Sending them a C & D
and blocking the withdrawl is not going to do anything. They could care
less about the c & d since they are operating illegally in the first
place. They operate under multiple names so if you block them under one
name they will go into your account under another name.
 

The C&D and other stuff is not for the payday lender, it's for the bank (for you to contest the EFT), and later for the CRA, if you need to get stuff removed.

 

The worst of the worst can be dealt with, I've been there.

Why would you use C&D for the bank? They are not collecting, unless you overdraft their account, then that's a different matter all together. C&D is for phone calls. You would have to write a Ach letter for the bank to stop the automatic payments one copy to the payday lender and one copy to the bank.

Edited by beli
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  • 1 month later...

Does anyone have any informative links on this topic? I'm trying to find out about Ameriloan which I foolishly took a pay day loan with. Of course again, foolishly not reading the fine print I did not realize it auto renewed every 2 weeks and it also required several days in advance to even pay off as they would not except a full payoff the day on or before payment is due.

 

I'm in PA and borrowed $450 and have now payed in nearly $700 but payoff is still $400. I believe in PA the consumer discount act applies which says:

 

The Department's position is that any company that engages in non-mortgage consumer lending to Pennsylvania residents by any means, including via the Internet or by mail, in which the aggregate interest, discount, bonus, fees, fines commissions, charges or other considerations exceed 6% simple interest per annum is required to obtain a license from the Department under the CDCA.

 

Now I get a little lost in this but is there a way I can find out if Ameriloan is licensed and what can I do if anything to quit this having paid almost double what I borrowed. Or am I just chocolate out of luck for being a sucker.

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From everything I can find, payday loans are illegal in PA, at least for now. Getting a regulatory agency involved to do anything about them, however, is probably a huge waste of time. The best advice I have seen on dealing with these lenders is to immediately close the account they are debiting, and open a new account (preferably with another bank). Other than trying to tap your account, there is nothing they can do to you. Since the loans themselves are illegal, they cannot sue you for the money, nor can they report the debt to a CRA (at least not legitimately). If it does show up on your credit report, you should be able to dispute it off.

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Does anyone have any informative links on this topic? I'm trying to find out about Ameriloan which I foolishly took a pay day loan with. Of course again, foolishly not reading the fine print I did not realize it auto renewed every 2 weeks and it also required several days in advance to even pay off as they would not except a full payoff the day on or before payment is due.

 

I'm in PA and borrowed $450 and have now payed in nearly $700 but payoff is still $400. I believe in PA the consumer discount act applies which says:

 

The Department's position is that any company that engages in non-mortgage consumer lending to Pennsylvania residents by any means, including via the Internet or by mail, in which the aggregate interest, discount, bonus, fees, fines commissions, charges or other considerations exceed 6% simple interest per annum is required to obtain a license from the Department under the CDCA.

 

Now I get a little lost in this but is there a way I can find out if Ameriloan is licensed and what can I do if anything to quit this having paid almost double what I borrowed. Or am I just chocolate out of luck for being a sucker.

they are illegal but the problem is, you can not get them to stop collections and no lawyers will take the case. IMO, pay the $400 ASAP and get away from these people. If you keep paying weekly it will take years to pay it off and you will pay 10x the amount. If you decide to stop paying they will call your neighbors, family, people that you might meet 5 years from now, your priest, your unborn child, and probably leave a note for you at heavens gate if you are going that direction.

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Does anyone have any informative links on this topic? I'm trying to find out about Ameriloan which I foolishly took a pay day loan with. Of course again, foolishly not reading the fine print I did not realize it auto renewed every 2 weeks and it also required several days in advance to even pay off as they would not except a full payoff the day on or before payment is due.

 

I'm in PA and borrowed $450 and have now payed in nearly $700 but payoff is still $400. I believe in PA the consumer discount act applies which says:

 

The Department's position is that any company that engages in non-mortgage consumer lending to Pennsylvania residents by any means, including via the Internet or by mail, in which the aggregate interest, discount, bonus, fees, fines commissions, charges or other considerations exceed 6% simple interest per annum is required to obtain a license from the Department under the CDCA.

 

Now I get a little lost in this but is there a way I can find out if Ameriloan is licensed and what can I do if anything to quit this having paid almost double what I borrowed. Or am I just chocolate out of luck for being a sucker.

they are illegal but the problem is, you can not get them to stop collections and no lawyers will take the case. IMO, pay the $400 ASAP and get away from these people. If you keep paying weekly it will take years to pay it off and you will pay 10x the amount. If you decide to stop paying they will call your neighbors, family, people that you might meet 5 years from now, your priest, your unborn child, and probably leave a note for you at heavens gate if you are going that direction.

:rofl: :rofl: :rofl:

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