Any deferred deposit – “payday” – loan in Utah must be made by a person or entity registered under Utah law. Any deferred deposit loan made by a person or entity who is not registered is void, and the person or entity may not collect, receive, or retain any principal or other interest or fees related to the deferred deposit loan. Here are some things to know about Utah law and payday lending:
– Lenders are required to post a schedule of fees using the APR and the dollar amount of the fees charged for any deferred deposit loan.
– Lenders are required to post the number a consumer may call to file a complaint about the payday lender. The Utah Department of Financial Institution’s phone number is (801) 538- 8830.
– Lenders cannot rollover (“extend”) the loan beyond ten weeks from the initial execution date of the loan.
– Lenders cannot charge interest past ten weeks after the initial execution date of the loan.
– Lenders may not make a new loan to you on the day you pay in full another loan if the combined loans will result in you paying more than 10 consecutive weeks of interest.
– Lenders may not make a new loan whose proceeds are used to satisfy or refinance any portion of an existing deferred deposit loan.
– Lenders are prohibited from threatening to bring criminal proceedings against you if a payment you provide to the lender is returned for non-sufficient funds.
– Borrowers may make payments on a loan in $5 increments or more without incurring any additional finance charges.
– Borrowers may rescind the payday loan and finance charges if they return the loan amount by 5:00 PM the next business day after the loan is obtained.
– Borrowers may request an interest-free Extended Payment Plan (EPP) once every 12 months, or any time they have paid ten weeks of interest on a deferred deposit or payday loan. This plan must be a minimum of 4 payments over a period of not less than 60 days.
– If the loan goes into the collection process because a borrower defaults, the borrower or its employer may ask the lender or collection agency, verbally or in writing, not to contact the borrower at work.
– At least 10 days before filing suit for nonpayment, a lender must notify a borrower by mail or email: – – that the borrower must make agreed payments or they will seek a judgment, and that payments may be made through an EPP.
*If A Borrower Cannot or Does Not Repay the Loan, the Payday Lender May Take the Following Actions:
A payday lender may seek a judgment against the borrower as a result of a returned check. If a court awards a judgment to a lender against a borrower, the lender may recover court costs and reasonable attorney’s fees from the borrower. Also, the court may order interest on the unpaid balance at the minimal federal rate. The lender may also list past due accounts with the various credit bureaus, which may affect a borrower’s ability to obtain credit in the future. A payday lender may only charge a borrower a maximum of $20 if his or her check bounces or is returned.
If a payday loan cannot be repaid, the payday lender may seek judgment for the amount of the loan, interest, attorney’s fees and court costs.
Many bankruptcy debtors have a choice between filing a Chapter 7 bankruptcy case and Chapter 13 bankruptcy case. There are many differences between the two chapters. An experienced Morrison Law Group attorney can help you determine which is best for your financial situation. Call 801.456.9933 today to schedule a FREE consultation and discuss your complete set of options. We have locations in Ogden, Logan, Sandy, and St. George to serve the residents of the counties of Weber, Cache, Salt Lake, Utah, Morgan, Davis, Washington, and surrounding areas.
