Posted by : Dougie Morris
Payday loans are small, short-term cash loans. Generally, consumers write a post-dated check for the desired amount, in addition to an interest fee. The lender will hold onto the check until the next payday (usually 14 days) and then deposits it. Consumers also have the option to return with cash to reclaim the check. Or, in some cases, consumers can repay the loan with a signed agreement which allows the lender to electronically withdraw the funds from their bank account on a pre-determined date. Payday loans are regulated by state; therefore, it’s important to understand your state laws.
Payday loan laws in Missouri include the following:
The maximum amount of money you’re allowed to borrow is $500.
Total fees, including rollovers, cannot exceed 75% of the initial loan amount. In other words, it is possible to pay $75 for every $100 loaned.
The minimum loan term is 14 days and maximum term is 31 days.
A maximum of 6 ‘roll-overs’ are permitted, however, the borrower must reduce the principal loan amount by a minimum of 5% with each renewal.
The Missouri Division of Finance licenses and regulates payday lenders and the payday loan industry. Online payday lenders that lend to Missouri residents must be licensed and adhere to their terms and conditions. You can verify the license of a payday lender in Missouri by calling 573-751-3242 or online.
Payday loans are based on proof of employment and income, whereas traditional bank loans assess credit history as a part of their evaluation. As a subprime borrower, be sure to understand the terms of a payday loan. A payday loan is intended to be utilized as a temporary financial solution. It’s critical that you repay the loan on time. Any late payment will result in significant consequences, potentially, making it even harder to obtain financing in the future.