Posts Tagged ‘Alaska payday loan laws’

Alaska Payday Loan Laws

As per Alaska payday loan laws, short-term cash advance programs are legal in this state, but there are still certain legal provisions that regulate payday lending practices. Whether you are considering borrowing a cash advance or are already trapped into the viscous cycle of debt caused by it, you must be well aware of the laws applicable in your state. The more you know about your legal rights and other legal provisions, the better you will be able to protect yourself against this type of predatory lending practices. If you have any complaint against any of your payday lenders, you can file your complaint with the Alaska Division of Banking and Securities.

Criminal Actions Are Prohibited

The Alaska payday loan laws prohibit payday lenders in their state from filing criminal lawsuits against those borrowers who are unable to make the repayment. However, they still have the right to sue you with a civil case. But, in any situation, you cannot be sent to jail just because of nonpayment of debt unless you are intentionally not making the repayment as part of a fraudulent activity.

NSF Fee limit

When you borrow a cash advance, he lenders charge you a check bouncing fee that is often termed as Non-Sufficient Fund (NSF) fee. This fee must not exceed $30. However, if there are certain clauses disclosed in the loan contract, the lenders may charge a maximum of $700 over the amount of the payment. As we can see, the Alaska payday loan laws have made no efforts to protect the consumers. But again, such whopping charges are applicable only when such provisions have been disclosed in the agreement. If you are borrowing a new payday loan, make sure you read the fine prints thoroughly; if you find such clauses, get them removed before you sign the contract. However, it is always wise to avoid this type of predatory lending programs at all costs, at least when you are in Alaska.

Two Rollovers Permitted

The state of Alaska allows payday lenders to get the loan rolled over for two consecutive months if the borrower fails to make the repayment. Another term for rollover is renewal. It means when a loan gets rolled over, it gets renewed and you become liable to pay interest for the extended period of time at the same rate as agree din the loan contract.

How Many Loans You Can Take At A Time, And How Much?

As per the Alaska payday loan laws, there is no maximum ceiling on how many outstanding cash advances you can have at a time, but at the same time, the laws restrict the maximum amount of loan (in total irrespective of the number of loans) to $500 only. If a lender offers you more than $500 as a short-term cash advance, say as $700, they can charge interest and other financial charges on $500 only while you will be liable to pay back only the principal amount for the remaining balance of $200. If the lenders force you pay interest on that amount also, you can file a complaint with the Alaska Division of Banking and Securities. Always remember, it is illegal in the first place for lenders to grant more than $500 of payday loans to a single consumer.

Minimum Repayment Period

The state laws do not specify any maximum limit on the repayment period, but the minimum period must not be less than 14 days.

Maximum APR

The maximum APR is a whopping 520% for every $100 of loan issued for a 14-day period.

Maximum Finance Charges

The finance charges must not exceed $20 in any case for every $100 of loan issued for a 14-day period. It is important to note that term “charges”, “rate”, and “fees” are different from each other and there are laws defining maximum limit on each of them.

Maximum Rates And Fees

Alaska payday loan laws allow payday lenders to charge a maximum of $5 as processing fee. In addition to that, they may also charge either 15% of the loan issued or $15 on every $100 of loan (whichever is less).

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