Are Payday Loans Illegal in New York?
Full Question:
I have 3 outstanding payday loans that I cannot pay due to severe medical issues that has me out of work. I was told that online payday loans are illegal. Is this true? If so, would this make the loan null and void. The total of the 3 payday loans is $1050.00.
07/11/2009 |
Category: Debts and Credit |
State: New York |
#17485
Answer:
Payday loans are illegal in New York state. A payday loan is a relatively small (usually under $500), high interest, short-term loan. A borrower gives a lender a postdated personal check or authorization for automatic withdrawal from a bank account. In return, the borrower gets cash, minus the lender's fees. The lender holds the check or electronic debit authorization for a week or two (usually until the next payday). At that time, the borrower has the option of (1) paying back the loan and fee in exchange for the original check, (2) letting the lender deposit the check, or (3) renewing or ‘rolling over’ the loan.
