Over the last few years, establishments known for their payday loan services have popped up on apparently all street corner. With assure of helping the cash strapped get by until payday, these businesses appear imminently helpful. That is, until one reads the excellent print and notices that they may be paying interest equivalent to an APR (annual percentage rate) of some hundred percent.
With the rise of the Internet, payday loan process has found a new niche on the web. Almost 40 percent of payday loans are now through online, and some estimation it will be over 60 percent by 2017. Many of these online processes bypass state restrictions, such as interest rate caps, by setting up their operations in unregulated states, Native American reservations, or foreign countries. These businesses use a model of making a loan predicated on having “automatic withdrawal” rights to the borrower's bank account. Banks like this, because it often leads to overdraft fees and the lenders like this because it gives them direct access to the borrower's funds so they can continue assortment efforts until paid in full, including any late charges and interest.
If you believe that you have been the subject of greedy lending or that a payday loans lender has violated the lending regulations in your jurisdiction, you may wish to speak with a legal representative. Although the amount in question may be too little to justify the expense of hiring a legal representative individually, it may be possible to seek assistance through a legal aid organization or to discuss whether a class action might be possible against the lender if their actions are part of an ongoing business practice.
