Payday loans are easy to get quickly, but they come with a big cost. Instead of helping you get past a difficult financial time, they can wind up sinking you further into the quagmire of increasing debt.
If you are struggling with unmanageable debts in Ohio, there is help available. The seasoned Ohio bankruptcy lawyers at Fesenmyer Cousino Weinzimmer in Columbus, Dayton and Cincinnati provide free initial consultations for people throughout central and southwestern Ohio who have gotten into trouble with loans. We will examine your individual situation and find the best way to guide you to debt relief.
What is the Law Regarding Payday Loans in Ohio?The state of Ohio attempted to protect consumers from outrageously high interest rates common among payday loan lenders. In 2008, Ohio passed the Short-Term Lender Law (STLA) regulating interest rates and prohibiting lenders from giving out loans on the internet or on the phone.
Additional protections include:
- Capping loan amounts at $500.
- The loan duration cannot be less than 31 days.
- Capping interest rate at 28% APR.
- The amount due may not be more than 25% of your gross salary.
- Restricting the number of loans a borrower may take within specified periods of time.
- Restricting tactics that may be used to collect past-due loans.
- Requiring lenders who make payday loans to register with the state as a short-term lender.
Unfortunately, this protection didn’t last, as lenders found a loophole in the law. In 2014, the Ohio Supreme Court ruled that payday lenders could bypass these regulations by registering as mortgage lenders (Ohio Neighborhood Fin., Inc. v. Scott, 139 Ohio St.3d 536, 2014-Ohio-2440).
To get around the consumer protections provided by the STLA, payday lenders can:
- Register as mortgage lenders under Ohio’s Mortgage Lending Act (MLA), which has fewer protections for consumers than does the STLA.
- Avoid the MLA’s interest rate cap of 25% by creating Credit Service Organizations, a kind of payday loan broker that adds high fees for “helping” the consumer find the loan.
There is no cap on the fee that the Credit Service Organization may charge. Your promissory note will describe the fee as a “prepaid finance charge,” which is added to the total interest you pay on the loan.
As a result, you no longer have the protections that Ohio lawmakers intended you to have on payday loans. Many Ohio debtors wind up overburdened with payday loan debt, including unreasonable interest and other penalties that can pile up quickly.
If you are an Ohio resident considering a payday loan, you should read the fine print in your loan agreement carefully.
Ohio Cash Advance Lending Laws
Cash or check advance loans are a type of short-term credit where people borrow a small amount at a very high interest rate. Borrowers usually write a post-dated personal check for the borrowed amount plus a fee, in exchange for cash. The lender holds the check and presents it for payment on the agreed date.
The interest rates for these loans are exorbitant. The Annual Percentage Rate may be as high as 390%. The borrower has 6 months to complete the total repayment.
Why do People Use Same-Day Payday Loans?
People use payday loans because it is the quickest way to get money. Usually they cannot send an application to the bank because they have bad credit history and don’t have time to wait to get the funds.
For payday loans, there is no credit check, no certificate of salary, no pledge of property, no explanation of why you need the money. All you need is your passport, your valid Ohio driver’s license or your U.S. military identification. An application for a short-term loan can be issued in the office, by phone or online, and you usually receive the money in one day.
Online Payday Loans in Ohio
Here is a list of companies that provide online payday loans and installment loans in Ohio:
- Check ‘n Go
- Payday Direct
- Check Into Cash
- Blue Trust Loans
- National Payday
- SpringLeaf Personal Loans
- Cash Central
- Prosper Personal Loans
If you owe money to one of these or any other company in Ohio and are being harassed because you are unable to make payments, there is help available.
Get Personalized Advice To Get Rid of Debt Troubles In Ohio
Chapter 7 or Chapter 13 bankruptcy is a way to eliminate debt and get a fresh start on the road to financial recovery. Once you file, the automatic stay provisions will prohibit payday lenders and issuers of check-cashing schemes from taking collection actions against you. When your bankruptcy discharge is complete, you will be free of debts owed to unscrupulous lenders.
The Ohio bankruptcy lawyers at Fesenmyer Cousino Weinzimmer in Columbus, Dayton and Cincinnati are ready to make your case an urgent priority as time is of the essence. Take the first step toward debt relief and contact the experienced and compassionate debt-relief attorneys at Fesenmyer Cousino Weinzimmer today for a FREE INITIAL CONSULTATION.
We know what you are going through. We will evaluate your entire financial picture by looking at your income, your debts and your goals, and we will discuss the best fit for your individual situation. We will handle every phase of the process and find what works best for you.
We welcome inquiries from clients throughout central and southwestern Ohio. From our law offices in Columbus, Dayton and Cincinnati, we have helped countless Ohio residents find new hope.
Delaying can only make your situation worse, so call the Ohio bankruptcy attorneys at Fesenmyer Cousino Weinzimmer today at one of our conveniently located office branches at 614-228-4435 (Columbus), 937-222-7472 (Dayton), or 877-654-5297 (Cincinnati), or email for your free consultation.