What can happen if you do not pay back a payday loan?

Answer 1

Payday loans are a terrible way to obtain money and should only be used in an emergency when the loan can be paid back immediately. They are not intended for long term loans because the interest rate soars as the debt remains unpaid. Rates as high as 500% per year are not uncommon. The results of not paying back a small loan on time will be disastrous.

Many lenders use unscrupulous and misleading business practices to snare customers and their contracts always favor the lender. In some cases they require a credit card and will begin to bill interest payments to the credit card. Lenders often use unethical and sometimes illegal methods of collecting their debts. Payday loans and cash advances are illegal in many states.
Check your state laws. Many states have made payday lending illegal due to high interest rates. In these cases, your loan may not even be enforceable. Your state financial regulator or attorney generals office can help you. If your state allows payday lending, then they could take civil action and sue you in court for default. No different than defaulting on a credit card. They cannot make threats of arrest, etc. Many will try to threaten you. Look up the Fair Debt Collections Practice Act. You may find that the collector is violating the law themselves.

Answer 2

The lender can file suit and if they are awarded a judgment they can execute against all non exempt real and personal property belonging to the judgment debtor. The preferred method of executing a judgment is the garnishment of wages or the levy of bank accounts.

Payday loans are a terrible way to obtain money and should only be used in an emergency when the loan can be paid back immediately. They are not intended for long term loans because the interest rate soars as the debt remains unpaid. Rates as high as 500% per year are not uncommon. The results of not paying back a small loan on time will be disastrous.

Many lenders use unscrupulous and misleading business practices to snare customers and their contracts always favor the lender. In some cases they require a credit card and will begin to bill interest payments to the credit card. Lenders often use unethical and sometimes illegal methods of collecting their debts. Payday loans and cash advances are illegal in many states due to high interest rates. In these cases, your loan may not even be enforceable. Your state financial regulator or attorney generals office can help you. Check your state laws.

If you are already being pursued for an unpaid payday loan remember that even if threatened with arrest by the lender's collector, you cannot go to jail for failure to pay debts. it is a violation of the Fair Debt Collection Practices Act (FDCPA) for a collection agency to threaten you with arrest. This applies to both first and third party collections. Read up on the FDCPA, start recording your phone calls (obtain permission if your state requires it), and contact a lawyer to initiate proceedings.

I used to work as a manager for a company that offered several different loans similar to payday loans and the best thing to do when you have a loan out and get in trouble is TALK TO THEM! You would be suprised how many people just drop off the face of the earth. They can not help you if they do not know you need help!!! Let them know what the situation is and ask them if they can work with you. 99.9% of the time they can and will. non professional answer Was it one that you wrote a post dated check for or a straight out high interest loan? I have had both types and if you don't make good a payday loan where you wrote a post dated check for the money, they will call the police on you and turn you in for writing a bad check. (at least they called the cops on me when I was two weeks behind). In the second type of loan. It was a $400.00 loan, and I made the first payment of $80.00 Then I lost my job. Now it is collections for well over $1600.00. Their ridiculous interest is 543% yes that is (five hundred and forty three percent annual interest). However, they can't get blood from a rock.

The borrower/debtor can be sued if the lender chooses. Generally such loans are small and states do not allow this type of lender to file a small claims case. However, some lenders will wait until the debt reaches a level that is deemed worth filing a creditor suit in the circuit court of the debtor's state.

Unfortunately, for some people this type of borrowing is often a must, but it really should be avoided even if the person has to sell property rather than enter into such an agreement. The interest rates and penalties attached to such loans are so exorbitant that the borrower can end up in a veritable money pit with no way to climb out. In addition, title loans in which the consumer uses their vehicle for collateral should be avoided at all cost.

In addition:

One, your interest will continue to occur as contracted in the loan agreement, and that amount can be very high, and in some cases several hundred percent. This means that if you don't pay, you will be liable in civil court for the damages, and those could be very high. Some states even impose double damages so the legal stand point is very risky and most likely the lender will win, especially if the contract is legal and valid in the state it was issued. The second part of this is whether or not a person can be arrested. Some lenders threaten to call the police on people that don't repay their loans, but in most states this practice is also illegal, and if a lender does threaten to have a person arrested for not paying a loan, then that person should immediately contact their state's attorney for clarification.

Answer 3

ask perciestantly. sue. right down notes.