Payday Loans

Rhode Island Payday Loan Laws

As per Rhode Island payday loan laws, it is legal for check cashers and other licensed lenders to issue short-term cash advances to the consumers residing in this state. However, there are certain legal restrictions that the lenders must abide by. If you find that you are being harassed by your lender and that the lenders are engaged in illegal practices, you can file a complaint against them with the Rhode Island Department of Business Regulation. Their fax number is (401) 222-5628, phone number is (401) 222-2405, and address is Division of Banking, 233 Richmond Street, Suite 231 Providence RI 02903.

Criminal Lawsuits May Be Filed Against Borrowers

Payday loan Borrowers in this state are at great risk, as Rhode Island payday loan laws have not specified whether criminal actions can be taken against borrowers for non-payment of debt are not. It means lenders have this option open to them. If you are unable to make the repayment because of any reason, your lenders have the right to file criminal suits against you. You can even be sent to jail. Though in general, such things do not occur, but it is still a big possibility. Lenders also have been given the liberty to charge as high a collection fee as they want because no maximum limits have been specified under the state laws.

One Rollover

When you fail to repay the loan on its due date, your loan account can be renewed or rolled over just once. But, it is important for you to keep in mind that even one time rollover can prove to be very costly for you because you will have to pay interest for the extended period of time at the same high rate (triple digit APR).

Maximum Number And Amount Of Loan

As per Rhode Island payday loan laws, a borrower cannot have more than three outstanding payday loans at one time. Besides that, there is also a maximum ceiling on each loan account. The amount of loan must not exceed $500 per loan account.

Triple-Digit APR And Other Addition Fees

The state laws allow lenders to charge a whopping 260% of APR (annual percentage rate) on short-term cash advances. Besides that, they can also charge an addition finance charge of $10 on every $100 of loan issued for a 14-day period.

Repayment Period

The lenders must also allow the borrowers a minimum period of thirteen days to make the repayment.

Overall, as we can see that despite certain restrictions imposed by Rhode Island payday loan laws, payday loans are still a very expensive financial option in this state, and it is very risky too.

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Posted in Payday Loan Laws, Payday Loans | 1 Comment »

One Response to “Rhode Island Payday Loan Laws”

  1. Martin says:

    Really impressed with this article. Pay day loans are very risky in Rhode Island. It is true that there are some legal restrictions for the lenders which they have to follow but the situation is still very risky. The most prominent risk factor is that it is not specified in the payday loan laws that whether criminal action can be taken against the borrower or not. If you are not able to do the repayment your lenders have an extra option of criminal case. The charges which can be taken by the lenders through different ways like penalty charges, collection charges etc are also responsible for making the picture horrible. Your loan can be renewed for one time, but due to very high interest rate this renewal can change the whole scenario. The annual percentage rate is very high additional finance charges can also be taken. The lenders have to give a minimum repayment period of 14 days. It is true that if you are in need of instant money, pay day loan can solve the problem but it can disturb your financial position in total.

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