Posts Tagged: ‘Payday Loans’

New Payday Loan Rules

November 2, 2017 Posted by kingcade

The Consumer Financial Protection Bureau (CFPB) announced new rules on payday loans this week that will help low-income borrowers and families trapped in a cycle of debt. Payday loans are typically between $200 and $1,000 and must be paid back as soon as the borrower receives his or her next paycheck.

On average, a fee of $15 for every $100 borrowed is charged, according to the Community Financial Services Association of America (CFSA). That is an annual interest rate of 391%.

The CFPB argues that most customers who take out the loans are already in financial trouble and cannot afford the fees and penalties associated with these loans.  Approximately four out of five payday loan customers re-borrow their loan within a month.

Here is what the new payday lending rules will do:

Qualify borrowers– Lenders will need to check a borrower’s income, living expenses and their major financial obligations, like their mortgage and car payment, to qualify them for the loan.  In most cases this will involve pulling their credit report.

Rules for loans under $500– Borrowers will not necessarily need to be qualified for these, but they must pay at least one-third of their loan back before they can take out another. Frequent borrowers and those who cannot afford to pay back the loans will be prevented from borrowing, again.

Limits on the number of loans– If a borrower takes out three payday loans back-to-back, lenders must cut them off for 30 days.  Also, unless they can prove an ability to pay it all back, borrowers cannot take out more than one payday loan at a time.

Penalty fee prevention. Lenders cannot continue trying to withdraw payments from a borrowers’ account if they do not have sufficient funds. After two payment attempts, lenders will be required to re-authorize a payment method with the borrower.

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If you have any questions on this topic or are in financial crisis and considering filing for bankruptcy, contact an experienced Miami bankruptcy attorney who can advise you of all of your options. As an experienced CPA as well as a proven bankruptcy lawyer, Timothy Kingcade knows how to help clients take full advantage of the bankruptcy laws to protect their assets and get successful results. Since 1996 Kingcade Garcia McMaken has been helping people from all walks of life build a better tomorrow. Our attorneys’ help thousands of people every year take advantage of their rights under bankruptcy protection to restart, rebuild and recover. The day you hire our firm, we will contact your creditors to stop the harassment. You can also find useful consumer information on the Kingcade Garcia McMaken website at www.miamibankruptcy.com.

New Payday Loan Regulations for Lenders

July 27, 2017 Posted by kingcade

Online lenders are now required to advertise on at least one price comparison website and display “prominently” a link on their own website to a price comparison site.  A cap on payday loan costs is also being enforced.  The Competition and Markets Authority (CMA), say the new rules are a win for consumers and will allow them to compare loans more easily and establish the best value. Borrowers will also be provided a clear explanation of the fees and charges, making it easier to determine the costs of missing payments.

We never advise clients’ resort to taking out payday loans, as this are an extremely costly way to borrow money.  We have identified alternatives to payday loans in another blog on this same topic.

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If you have any questions on this topic or are in a financial crisis and considering filing for bankruptcy, contact an experienced Miami bankruptcy attorney who can advise you of all of your options. As an experienced CPA as well as a proven bankruptcy lawyer, Timothy Kingcade knows how to help clients take full advantage of the bankruptcy laws to protect their assets and get successful results. Since 1996 Kingcade & Garcia, P.A. has been helping people from all walks of life build a better tomorrow. Our attorneys’ help thousands of people every year take advantage of their rights under bankruptcy protection to restart, rebuild and recover. The day you hire our firm, we will contact your creditors to stop the harassment. You can also find useful consumer information on the Kingcade & Garcia website at www.miamibankruptcy.com.

FTC Cracks Down on Dishonest Payday Lenders

January 30, 2017 Posted by kingcade

The FTC has been targeting fraudulent payday lending companies, headquartered in Missouri and Kansas, with consumer settlements reaching as high as $1.266 billion. The FTC recently announced charges against Joel Jerome Tucker, and his companies, SQ Capital LLC, JT Holding Inc., and HPD LLC, for selling portfolios made up of phony payday loans.

The loans listed in the portfolios named fake lenders and debtors, including their social security and bank account numbers, and led to collection activities against consumers who had not taken out loans, according to the FTC.

In another case, a settlement was reached between the FTC and payday lenders, Tim Coppinger and Ted Rowland, and their companies.

Under the terms of the agreement, the lenders paid nearly $1 million with the threat of substantially greater judgments (up to $32 million) should they fail to abide by the terms of the settlement agreement. The fraudulent activity included debiting money from the accounts of people who never requested loans, but for whom the payday lender had obtained personal information. They would then charge interest and fees on the unauthorized loans.

Click here to read more on this story.

If you are in financial crisis and considering filing for bankruptcy, contact an experienced Miami bankruptcy attorney who can advise you of all your options. As an experienced CPA as well as a proven bankruptcy lawyer, Timothy Kingcade knows how to help clients take full advantage of the bankruptcy laws to protect their assets and get successful results. Since 1996 Kingcade & Garcia, P.A. has been helping people from all walks of life build a better tomorrow. Our attorneys’ help thousands of people every year take advantage of their rights under bankruptcy protection to restart, rebuild and recover. The day you hire our firm, we will contact your creditors to stop the harassment. You can also find useful consumer information on the Kingcade & Garcia website at www.miamibankruptcy.com

Federal Suit would take Google’s Payday lending crackdown a step further

June 3, 2016 Posted by kingcade

Google has announced that beginning in July, it will stop selling ads to payday lenders and other companies in the business of short-term, high-interest consumer loans. Currently, when a consumer types into Google “need cash now,” the results are paid advertisements from high interest lenders and companies that refer them customers.

However, beneath those paid advertisements are search results with links to websites, such as INeedALoan.net and LocalCashNow.com that promise to connect borrowers with the same type of predatory loans.  But a lawsuit filed by a federal watchdog could make it harder for those lead-generation sites to operate and may even put some out of business.

Last year, the Consumer Financial Protection Bureau (CFPB) sued T3Leads, a Burbank broker that sells consumer loan inquiries to online lenders alleging that it does little to prevent the lead-generation sites it works with from making misleading claims.

Online lenders are already worried over Google’s decision to no longer sell ads for short-term or high-interest loans — those that must be repaid within 60 days or that carry interest rates of 36% or higher. Google sources said the policy, which goes into effect July 13, will also apply to lead-generation websites that sell consumer data to those lenders.

On the typical lead-generation site, borrowers fill out an application, provide names, addresses, even Social Security and bank account numbers. Once borrowers click submit, it triggers a series of nearly instant transactions.

First, the information is usually sold by the lead-generation site to an aggregator like T3. Next, the aggregator auctions the information to lenders. Finally, the borrower is automatically redirected to the website of whichever lender won the auction.

The CFPB alleges that the process can result in consumers being tricked into taking out loans from lenders that charge the highest interest because often they are the highest bidders for the lead.

Click here to read more on this story.

If you are in financial crisis and considering filing for bankruptcy, contact an experienced Miami bankruptcy attorney who can advise you of all your options. As an experienced CPA as well as a proven bankruptcy lawyer, Timothy Kingcade knows how to help clients take full advantage of the bankruptcy laws to protect their assets and get successful results. Since 1996 Kingcade & Garcia, P.A. has been helping people from all walks of life build a better tomorrow. Our attorneys’ help thousands of people every year take advantage of their rights under bankruptcy protection to restart, rebuild and recover. The day you hire our firm, we will contact your creditors to stop the harassment. You can also find useful consumer information on the Kingcade & Garcia website at www.miamibankruptcy.com.

Payday Loan Changes Coming to Florida

May 9, 2016 Posted by kingcade

Payday loans are quick cash that come with steep consequences, oftentimes the interest rate on payday loans can easily reach triple digits.  However, for many individuals and families living paycheck-to-paycheck, it’s the only way to make ends meet. Tens of thousands living in Florida rely weekly on payday loans.

Payday loans are short-term and often paid off as soon as the borrower receives their next paycheck.  But between the high interest rates and fees, this quick cash comes with a hefty price tag.  Annual percentage rates can soar as high as 400%!  This month the federal government is expected to impose national standards and limits on payday loans.

Consumer counselors agree that payday loan rules not only keep lenders in check, but protect people from getting in over their heads. In Florida, about 7% of the population relies on payday loans. That is one of the highest rates in the nation. There is also concern that if federal guidelines make the rules too strict, people who actually need the cash in a crisis – for example, to pay for a car repair or medical bill – may not be able to get it.

The question now is whether the new federal rules would strengthen, weaken, or leave in place what the state has already established.

Payday lending is limited in several ways in Florida. The law places limits on:

  • the amount of the loan ($500);
  • the number of loans you can have outstanding (only one at a time);
  • the length of the loan term (cannot be for less than seven days or more than 31 days);
  • the fees and costs that can be charged (interest is capped at 18%), and
  • the collection process if you do not pay.

To learn more about Florida’s payday loan laws, click here.

If you are in financial crisis and considering filing for bankruptcy, contact an experienced Miami bankruptcy attorney who can advise you of all your options. As an experienced CPA as well as a proven bankruptcy lawyer, Timothy Kingcade knows how to help clients take full advantage of the bankruptcy laws to protect their assets and get successful results. Since 1996 Kingcade & Garcia, P.A. has been helping people from all walks of life build a better tomorrow. Our attorneys’ help thousands of people every year take advantage of their rights under bankruptcy protection to restart, rebuild and recover. The day you hire our firm, we will contact your creditors to stop the harassment. You can also find useful consumer information on the Kingcade & Garcia website at www.miamibankruptcy.com.

Related Resources: http://www.wtsp.com/money/payday-loan-changes-could-affect-thousands-in-bay-area/154400569