Virginia Payday Loan Laws and Legislation
In 2011, the State Corporation Commission collected data for the first time on the short-term credit industry. The figures illustrate the popularity of payday and title loans - and the problems that borrowers encounter. According to the SCC, more than 105,000 people obtained car title loans in 2011. About 13 percent failed to make a monthly payment for at least 60 days. And lenders repossessed 8,387 vehicles from borrowers, a move that certainly couldn't have improved their financial standing. Payday loans, meanwhile, were extended to more than 147,000 people in Virginia in 2011, and roughly 80 percent of them obtained more than one loan during the year.
Virginia Payday Loans. The Virginia State Legislature passed a new payday loan law in April 2008 which put a 36% interest rate cap on small consumer loans. It also mandated that a statewide database of payday loan transactions be created and all prospective borrowers be screened against this database. It is anticipated the majority of the brick-n-mortar payday loan operators will abandon the payday loan market to the payday loan Internet and offshore operators.
Advocates of further restrictions say the 2008 law did not go far enough to stop "predatory lending" practices and that the law still allows lenders to charge interest rates that climb
well above 200 percent when fees and other charges (Application fees, credit check fees. ) are factored in.
We suggest you concentrate your research on the Payday Loan Internet Model and the Credit Services Organization as described here. Although our discussion focuses on the Texas Credit Services Organization Model, you and your team may determine it is appropriate for a multiplicity of states.
Payday loan restrictions. New regulations will restrict some payday loans. A law goes into effect July 8th that requires the State Corporation Commission by Jan. 1 to contract with third parties to develop and maintain an Internet database that payday lenders will have to check before issuing loans. Among other things, payday lenders will be prohibited from issuing loans to borrowers who already have outstanding payday loans.
Virginia Payday loan laws. Virginia Payday loan legislation. Virginia has specific payday advance laws. The permitted fee is 15 % of the face amount of the payday loan amount. The permitted time period is a minimum of 7 days.
The maximum amount of the payday loan allowable is $500.00. Rollovers are prohibited.
For a thorough discussion of the payday loan industry and access to our payday loan training materials, we recommend you proceed to Payday and Paycheck Loans.comSource: www.paydayloanlegislation.com
Category: Payday loans