There are a lot of misunderstandings about payday loans, and this can result in confusion for those who need short-term funding for any type of situation. Getting to know the facts about short-term loans in Florida can clear up these misperceptions and give consumers the information they need to make informed choices.
There are several reasons why people may turn to payday loans. The most common reasons include medical emergencies, vehicle breakdowns, and unexpected bills or expenses. There is no need to provide a reason for the loan, which is very different than when applying for a loan with a bank or financial institute.
Regulations and Consumer Protection
All companies in Florida offering payday loans have to adhere to regulations that are developed by the state. This makes these loans legal, and there are protections in place for both the borrower as well as the lender.
The regulations prevent a person from having more than one of these loans at a time. One of the most common reasons for denial of these loans is that the applicant already has a loan with another lender.
There are also laws on the fees the lenders can charge, which is no more than 10% of the loan. There are also limits on the total value of the loan with $500 the maximum amount offered by most lenders for typical types of payday loans.
The borrower cannot roll over the loan, but the lender may offer a repayment plan if the loan is not paid in full, including the fees, on the due date. The due date cannot exceed more than 31 days from the time the loan is opened. In most cases, the due date for the loan is the next paycheck, so most people have a 14-day window for repayment.