Are Payday Loans Legal in Louisiana?
Short-term Payday Loans are legal in the state of and are mostly regulated through La. Stat. Ann. 9:3578.1 et seq..
Louisiana Revised Statutes.pdf
The Payday Lending legislation covers all the parts of the process concerning:
- Payday Loan amounts
- Payday Loan repayment terms
- Payday Loan online direct lenders
- Payday Loan stores near you
- Payday Loan interest rates and other fees
- Payday Loan collecting practices
- Payday Loan default penalties
- The number of outstanding Payday Loans as well as a cooling-off period in-between etc.
Read more: PAYDAY LOANS IN LOUISIANA
The main Payday Loan requirements in Louisiana are:
- US residence
- Minimum regular income of $1,000 per month
- Valid checking or savings account with direct deposit
- Phone number and e-mail address
Any eligible Louisiana resident can apply for $350 Payday Loan amount. It should be repaid within 60 day(s). Earlier payments don’t contemplate any additional penalty fees. The interest rates are maximum 780.00%, but on average direct lenders charge 400% APR. For other details read further to find out how many Payday Loans you can borrow, whether rollovers or extensions are allowed, etc.
Louisiana residents who are eligible for a Payday Loan can get up to $350 cash advance per contract. The repayment term is capped at up to 60 days.
However, there are no limits on the purpose of loan usage. Any urgent expenses, unforeseen bills, car repair, home repair, etc. may seem a sound reason to apply for a Payday Loan in Louisiana.
If a Payday cash advance is not enough, there are always other options to receive the necessary funds in Louisiana: unsecured Installment Loans, bad credit Personal Loans, Title Loans, Check Cashing, Pawn Shops, etc.
Louisiana Payday Loans online laws
Payday loans from both storefront and online lenders are legal in the state of Louisiana. But the companies should operate according to the Louisiana Office of Financial Institutions, P.O. Box 94095 Baton Rouge LA 70804, (225) 925-4660 regulations.
Though there’re some limits on how payday loan direct lenders should run businesses, still there are some. Reputable online lenders operating in accordance with all relevant state and federal laws can be applied to and compared on our platform using a simple online application form.
You state the necessary amount, fill in your personal information and get suitable offers from legit direct lenders. It takes only a few minutes and doesn’t affect your credit score.
Louisiana Payday Loans interest rates, fees, and other finance charges
The main part of payday loan payment is mostly made up of the interest rate, or APR. The maximum APR that may be charged for short-term cash advance in Louisiana is 780.00% while on average the lenders charge 391.00%.
Besides, the total cost of a Payday Loan includes some additional fees. Louisiana lending rules allow charging One NSF fee of actual bank charge (if disclosed) + the greater of $25 or 5% of check (if disclosed); Court Costs; Reasonable Attorney’s Fees .
The law obligates Iowa Payday Loan lenders to provide you with a written disclosure of all the rates and fees in understandable language. You should read them carefully and if you agree acknowledge the notification by signing the contract.
Louisiana Payday Loans direct lenders regulations
According to Louisiana payday loan laws, all direct lenders are obliged to register their companies which will allow issuing payday loans contract. It concerns both Online Payday Loans and Payday Loans Near Me
Now, payday lenders are operating online to make it faster, easier and more convenient for borrowers to get the necessary funds. However, it is often illegal for online payday lenders to make loans to Louisiana consumers. Payday lenders, or direct deposit lenders, must be licensed by the state in order to run a lending business in Louisiana, and to be licensed, the lender is required to have a physical location in the state. Louisiana has put these laws in place to prevent consumers from getting scammed on the web, and you should apply for online payday lenders’ loans with caution.
The Office of Financial Institutions (OFI) licenses payday lenders and is statutorily mandated3 to regulate them to ensure they are meeting all state payday lending laws. To regulate payday lenders, OFI conducts an onsite examination of a sample of loans at each payday lending
location six months after opening, one year after the six-month examination, and at least once every four years after the last examination.
Regulation of Payday Lenders Office of Financial Institutions.pdf
But Louisiana Payday Loan lenders are prohibited to threaten you for late payments or loan default and conduct any criminal actions against you.
Nevertheless, you should be careful not to come across any scams. Some unfair lenders can operate without license or under a different license and offer too expensive ‘payday loans’ under illegal conditions. Always check that the lender you are going to apply to works under Louisiana state law.
Louisiana Payday Loans consumer information
Besides amounts, rates and fees, consumers must be also well aware of other details of Payday Loans in Louisiana. They include the availability and number of rollovers, extensions and repayment plan, a cooling-off period, any default penalties or additional fees, etc. Check out the table below to find the most essential information:
|Rollovers or extensions||1 repayment plan in 12 months|
|NSF fee||One NSF fee of actual bank charge (if disclosed) + the greater of $25 or 5% of check (if disclosed); Court Costs; Reasonable Attorney’s Fees|
Look for more detailed information on the official Iowa state regulator website – Louisiana Office of Financial Institutions, P.O. Box 94095 Baton Rouge LA 70804, (225) 925-4660.
Legitimate Payday Loans Online with NO credit check in Louisiana
Looking for a legal Payday Loan with No credit check in Louisiana? You must understand the meaning of this phrase correctly at first. No credit check implies that a lender will not inquire about your credit history information from or send your borrowing data to any of the three major credit bureaus Equifax, Experian and TransUnion.
If you don’t want to damage your credit history, Louisiana law allows you to apply for a Payday Loan with No credit check. But you should understand that a lender needs to check your creditworthiness at least in some way. He can perform a soft credit check when a lender pre-approves you for a loan and this inquiry will not appear on your credit report. Or there’re other ways to prove you can afford the cash advance. Payday Loan lenders use the tracking system to verify your debts, check your income, etc. And generally, they charge higher interest to lessen the risks.
Louisiana Payday loans online no credit check are one of the easiest options of getting quick cash to cope with emergency financial requirements, especially for people with poor credit.
Does Louisiana law allow Payday Loans for bad credit borrowers?
The average credit score in Louisiana is 650, placing it in the good range. But it doesn’t mean that those who have worse credit can’t apply for a Payday Loan in Louisiana.
- First of all, there’re a lot of legit direct lenders in Louisiana providing Payday cash advances to borrowers with both good and bad credit scores.
- Secondly, you can always find a cosigner to increase your chances of being approved for a bad credit Payday Loan.
- Find out how to improve your credit score and do your best to do it fast.
- Or consider taking out a bad credit Installment Loan, or bad credit Personal Loan.
Legit Payday Loans in Louisiana collection practices
If the consumer fails to pay any extended payment plan installment when due, the consumer shall be in default of the extended payment plan, and the licensee may immediately accelerate payment on only the remaining balance of the extended payment plan.
Upon default, the licensee may take action to collect only the amount outstanding on the extended payment plan. A licensee is prohibited from collecting any amount on an extended payment plan other than what the consumer owes pursuant to the plan on the date of default.
If a consumer enters into an extended payment plan, the consumer and licensee are prohibited from entering into a subsequent deferred presentment transaction or small loan until repayment in full of the extended payment plan.
Louisiana regulations on payday lending offer little protection for customers. Louisiana regulates payday lending through the Office of Financial Institutions, the state agency that is also responsible for oversight, licensing, and enforcement of banks and other alternative financial services such as check cashing services and pawnbrokers. The Louisiana Deferred Presentment and Small Loan Act (effective 2000) defines the finance charges for a payday loan. Loans are limited to a maximum of $350. Lenders may charge borrowers a fee no greater than 16.75% of face-value of check, + $10 documentation fee (After default: months 1-12: 36% per year; months 13 and beyond: 18% per year).
Although the Deferred Presentment and Small Loan Act prohibits rollovers, borrowers are allowed to refinance their loan as long as they pay 25% of the principal plus additional fees each time they refinance, extending their debt even further. If a customer defaults on their loan, a lender may charge 36 percent interest for one year and 18 percent thereafter, or a one-time delinquency fee of $10 or 5 percent the amount borrowed, whichever is greater. The law provides scant protection for Louisianans in need of short-term credit. A 2009 analysis of the regulatory framework concluded that “Louisiana’s stated commitment to sustaining the payday lending industry signifies that consumer
protection is a lower priority than industry protection.”
If you think that your payday lender violates the Louisiana Payday Loans law, you may file a written complaint with Louisiana Office of Financial Institutions, P.O. Box 94095 Baton Rouge LA 70804, (225) 925-4660. The supervisor from that office interviews witnesses, reviews the payday lender’s business records and documentation, and determines whether to pursue civil or criminal charges.
The Government is negotiating the option of canceling Payday Loans in Louisiana. The residents borrow more than 4 loans each year.
More Than 28,000 Payday Loans were Processed In 2013. There is one payday loan store for every 1500 people in the city of Bogalusa, LA.
And many Payday Loan borrowers are stuck in a cycle of debt. The Government wants to try to help them get a handle on it by restricting payday loan options.
But will the outlaw be useful in this case? Where will Louisiana residents get emergency funding? The better way is to provide financial education to the borrowers. People need to be taught how to manage their money and live within their means. They need to have problem-solving strategies to help keep borrowers from falling into a debt trap from any kind of money help. If it isn’t payday loans hurting personal finances, it would be another until people get the right education needed to improve their budgets.
Louisiana Payday Loans’ historical background
|before 1990s||12% interest rates limit|
|1990s||Louisiana Deferred Presentment and Small Loan Act, exempted payday loans from usury laws and the payday loan stores opened for business.|
|2006||Loans to the military were capped at 36% APR.|
|2010||Fees for Payday Loans were increased.|
|2014||The bill attempting to limit the APR at 36% was passed but failed.|
|June 2, 2016||The Consumer Financial Protection Bureau (CFPB) proposed a Payday Loan Rule that hasn’t yet fully come into effect (the federal rule is expected in November 2020).|
|2018||It was proposed to expand Payday Loans but with no success.|