Everything There Is To Know About Payday Loan Laws In The United States of America

Payday loans are a relief to many Americans, allowing for just about anyone to overcome any unexpected financial hardship. With so many people in every state living paycheck to paycheck, fender benders or surprise medical bills can seriously threaten to break the bank. Don’t feel the fear of an unforeseen financial burden, find a lender in your state and make payments on your own terms! But first you need to know the state laws regarding payday loans.

 

In the United States, payday loans are regulated by state law. Payday loan laws in the United States are simple and straightforward. According to their laws, many states have similar limits on both loan amount and terms, allowing borrowers to receive upwards of $500 and a repayment period of 31 days in mort states. Not every state laws are the same though, as some consider payday lending illegal in its entirety. Find out your state’s payday loan laws now!

 

How To Get A Payday Loan In Any State bu Law In 4 Short Steps

While some states have laws that are more favorable to payday loan companies, others have laws that protect consumers more. It’s important to know what the laws are in your state so that you can make an informed decision about whether or not a payday loan is right for you and you are not breaking the law.

While many states vary in their laws and regulations regarding payday loans, the requirements are the same in every state. The application process is very similar as well, so long as the necessary paperwork is gathered together everything is straightforward laws. Almost anyone in their state can complete the application process in a few easy steps:

 

1. Collect all prerequisite in your state documents and identification

While just about anyone can apply for a payday loan in their state, there are certain documents applicants must have with them by law in order to apply. According to payday loan laws, future loanees need a proper identification and to be a resident of the state in which they wish to borrow. Second, by state laws borrowers need a social security number, a bank account and a physical address in their state in order to proceed. After that under the payday loan law someone pursuing funding will be obligated to provide proof of income. Proof of income is one of the most important and decisive documents someone could bring to the application by laws, it is a huge factor in an approval process. Some lenders in your state may also ask for an email address or phone number to maintain contact information.

 

1. Find a financial institution in your state that sells payday loans

Using the internet, anyone can find a myriad of financial institutions in their state interested in selling payday loans. With all these options consumers can take time and find the right loan that is tailored to their exact scenario. Many lenders have their rates online as well, allowing you to compare payment plans from the comfort of your own couch! Going in person to a brick and mortar payday lending store is always an option as well, as many prefer to work in person. Just make sure that the law allows such stores in your state. Once the documents have been gathered, the identification has been found and the lender has been located, you are finally ready to apply for a payday loan in your state!

 

1. Receive the deposit and pay off your debts

The banker will quickly work to process the application and approve it. If approved, most banks can go ahead and deposit the funds directly into an active checking account! If an application was filled out online, many can apply and get paid from their own couch! With same day payday loans many Americans can even obtain same day funding in their state. With the money finally moved over according to the laws its time to pay off whatever pressing debt you may have had.

 

1. Understand your fee scheduling and pay back the loan

By laws, once the initial debt is paid off, it is time to focus on repaying the payday lender. Payday loan laws are intended to keep borrowers afloat until their next paycheck, so they were designed to be repaid quickly. In accordance with state law payments may be made towards the loan before the maturity or the loanee may wait until the final day to complete their payment. After remunerating the financial institution, the debt has been covered and repaid by law. You’ve finally gotten past payday loan laws in the United States of America!

 

Payday Loans Rates and Terms by Laws

While payday loans are similar in their concept in every state, the regulations and laws surrounding them vary greatly. Some states have laws that place limits on how much a payday lender can charge in fees, while other states do not such laws. Loan amounts and terms, maximum APRs and even legal status are elements of payday loan laws that vary greatly from state to state. Each state has its own set of laws and regulations. These laws govern everything from how much money a borrower can take out in a loan to how long they have to repay it. Here we can take a look at payday loan laws in the United States:

 

State	Law Status	Maximum Loan Amount	Maximum Loan Term	Maximum APR	Finance Charges	Regulation
Alabama	Legal	$500	31 Days	456%	17.5% of the total amount of the loan	Law: 5-18A-1 et seq.
Alaska	Legal	$500	14 Days	435%	15% of the total amount of the loan	Law: 06.50.010 et seq.
Arizona	Prohibited					Ariz. Rev. Stat. 6-632
Arkansas	Prohibited					H.B. 2021.
California	Legal	$300	31 Days	460%	15% of the total amount of the loan	Cal. Fin. Code 23000 Civil code 1789.30 et.seq
Colorado	Legal	$500	6 Months	36%	36% of the total amount of the loan	Colo. Rev. Stat. 5-3.1-101 et seq.
Connecticut	Prohibited					CGS 36a-563, -565,
Delaware	Legal	$1,000	60 Days	521%	No limit	Del. Code Ann. Tit. 5 2227 et seq.
Florida	Legal	$500	31 Days	304%	10% of the total amount of the loan	Fl. Stat. Ann. 560.402 et seq.
Georgia	Prohibited					Law 16-17-1 et seq.
Hawaii	Legal	$600	42 Days	460%	15% of the total amount of the loan	Hawaii Rev. Stat. Ann. 480F-1 et seq.
Idaho	Legal	$1,000	Not specified	652%	No limit	Idaho Code 28-46-401 et seq.
Illinois	Legal	$1,000 or 25% of your gross income, whichever is less	13 Days minimum, 120 days maximum	404%	$1 verification fee,  then 15.5% of the total amount of the loan	Law: 815 ILCS 122 et seq.
Indiana	Legal	Minimum of $50, maximum of $550	14 Days minimum, no maximum specified	391%	<$250, 15%. $250-$400, 13%. $400-$550, 11% of the total amount of the loan	Ind. Code 24-4-4.5-7-101 et seq.
Iowa	Legal	$500	31 Days	337%	$15 on the first $100, $10 on every ensuing $100	Iowa Code Ann. 533D.1 et seq
Kansas	Legal	$500	30 Days	391%	15% of the total amount of the loan	Kan. Stat. Ann.  16a-2-404, 405
Kentucky	Legal	$500	60 Days	460%	15% of the total amount of the loan	Kentucky Rev. Stat. Ann. §§ 286.9.010 et seq.
Louisiana	Legal	$350	30 Days	391%	16.75% of the total amount of the loan	La. Rev. Stat. Ann. Law: 9:3578.1 et seq.
Maine	Legal	$2000	Not specified	30%	< $75 fee of $5, $75-$250 fee of $15, >$250, fee of $25	Me. Rev. Stat. tit. 9-A § 1-201,  2-401
Maryland	Prohibited					Md. Code Com. Law § 12-101 et seq
Massachusetts	Prohibited					Small Loan Act, 209 Mass. Code Regs. 45:14(8),
Michigan	Legal	$600	31 Days	369%	15% for the first $100, 14% for the second, 13% for the third, 12% for the fourth, 11% for the fifth and sixth instances of $100	Mich. Comp. Laws  487.2121 et seq.
Minnesota	Legal	$350	30 Days	200%	< $50 fee of $5.5, $50-$100 fee of 10% + $5, $100-$250 fee of 7% $10 minimum + $5; $250-$350 fee of6% $17.5 dollar minimum + $5	Minn. Stat. 47.60 et seq.
Mississippi	Legal	$500	30 Days	521%	<$250 Fee $20 per $100, $250-$500 fee $21.95 per $100	Miss. Code Ann. 75-67-501 et seq.
Missouri	Legal	$500	31 Days	443%	Fee may not exceed 75% of the initial loan amount	Mo. Rev. Stat. §§ 408.500.1 et seq.
Montana	Legal	$300	31 Days	36%	1.39% of the total amount of the loan	Mont. Code Ann. 31-1-701
Nebraska	Legal	$500	34 Days	460%	15% of the total amount of the loan	Neb. Stat. Ann. 45-901
Nevada	Legal	25% Of monthly gross income	35 Days	625%	No Limit	Nev. Rev. Stat. 604A.010 et seq.
New Hampshire	Legal	$500	30 Days	36%	1.38% of the total amount of the loan	N.H. Rev. Stat. Ann. 399-A:1 et seq
New Jersey	Prohibited					Consumer loan act, N.J. Stat. Ann. tit. 17, 1 et seq., N.J. Stat. Ann. 2C: 21-19
New Mexico	Prohibited					N.M. Stat. Ann. 58-15-32 to 38
New York	Prohibited					N.Y. Banking Law 340 et seq
North Carolina	Prohibited					N.C. Gen. Stat. 53-173
North Dakota	Legal	$500	60 Days	487%	20% of the total amount of the loan	N.D. Cent. Code 13-08-01 et seq.
Ohio	Legal	$1,000	1 Year	28%	28% of the total amount of the loan	Ohio Rev. Code Ann. 1321.35 et seq.
Oklahoma	Legal	$500	45 Days	207%	17% or 20% of the borrower’s monthly income, whichever is less	Okla. Stat. Tit. 59 3101 et seq.
Oregon	Legal	$50,000	60 Days	36%	36% of the total amount of the loan	54 Or. Rev. Stat. 725A.010 et seq.
Pennsylvania	Prohibited					Check Cashing Licensing Act of 1998, 505(a)
Rhode Island	Legal	$500	Minimum of 13 days, no maximum specified	261%	10% of the total amount of the loan	R.I. Stat. Ann. 19-14.4-1 et seq.
South Carolina	Legal	$550	31 Days	391%	15% of the total amount of the loan	S.C. Code 34-39-110 et seq.
South Dakota	Legal	$500	Not specified	36%	1.39% of the total amount of the loan	S.D. Codified Laws 54-4-36 et seq.
Tennessee	Legal	$500	31 Days	460%	15% of the total amount of the loan	Tenn. Code Ann. 45-17-101 et seq.
Texas	Legal	$800	7 Days minimum, 180 days maximum	400%	>$30 fee of $1 for each $5, $30–$100 fee of 10% + $3 /mo, <$35 $35–$70 fee of $3.50/mo + $4/mo,  >$100 fee of $10 + $4/mo for each $100	5 Tex. Fin. Code 393 et seq.,  4 Tex. Fin. Code 342.004
Utah	Legal	No Limit	70 Days	658%	Not specified	Utah Code Ann. 7-23-101 et seq.
Vermont	Prohibited					8 V.S.A. § 2519(a)(13)
Virgina	Legal	$2,500	4 Months minimum, 24 months maximum	36%	8% of the amount of the loan per month with the total not exceeding 50%	Va. Code Ann. §§ 6.2-1800 et seq.
Washington	Legal	$700 or 30% of the gross monthly income, whatever is less	45 Days	391%	<$500 fee of 15%, >$500 fee of 10%	Wash. Rev. Code Ann. 31.45.010 et seq.
West Virginia	Prohibited					W. Va. Code 46A-4-107 and 32A-3-1 et seq
Wisconsin	Legal	$1,500 or 35%  of the gross monthly income, whatever is less	90 Days	574%	3.75% of the total amount of the loan	Wis. Stat. 138.14
Wyoming	Legal	Not specified	1 Month	261%	20% of the total amount of the loan per month	Wy. Stat. 40-14-362 et seq.

 

States vary wildly in their approach to payday loan laws. Law of states like New Jersey, New Mexico and New York bans most or all forms of payday lending altogether. Laws in some states choose to allow payday lending to occur in their territories, albeit under incredibly strict conditions by laws. Some state laws let just about anything fly, locations like Oregon and Texas really let borrowers delve deep into payday pockets. Overall, the most common payday loan laws allow loanees to acquire payday loans with dollar amounts floating around the $500 range and terms somewhere close to 31 days. While it may not be the $50,000 of Oregon laws, a $500 Iowa payday loan can cover the most urgent of expenses until your next paycheck. Payday loans in the United States are readily available online by law as well, as you can very clearly see above!

If you’re considering taking out a payday loan, make sure you understand laws in your state. 

 

Frequently Asked Questions about Payday Loan Laws in the United States

If I live in North Carolina where payday loans are banned by law, can I travel to South Carolina where the law allows them and apply for one in that state?

No you may not. One of the requisites of payday lending laws in any state is that the applicant must be a resident of that state. By laws, you can not obtain a payday loan while being considered a resident of North Carolina.

 

What does the average payday loan look like in the United States? 

Most states by their local laws give out payday loans with maximums around $500, loan terms near 31 days and APRs above 300%. While the laws surrounding payday loans vary from state to state, it’s also important to understand the risks involved with taking out a loan like this.

 

What are some alternatives to getting a payday loan?

When looking for quick cash, some turn to their friends or family for loans. If you don’t have that option, some charities in your state will pay off your most essential bills with proof of need. If you’re looking for a fast financial boost and the ability to maintain your independence, a payday loan in the United States of America is the way to go. Just be sure you understand the laws about this type of borrowing in your state.