Chances of getting a ayday loan in Minnesota

In accordance with the Minn. Stat. § 47.60 et seq. payday lending industry is a legal business in Minnesota.

However, the State residents should act reasonably when asking payday lending companies for a financial help, as payday loans are very expensive. The legislative acts of Minnesota highly regulate and control operations of lending firms. These regulations are imposed with the aim of safeguarding local customers against dishonest lenders. Under the Minnesota law payday loans can be provided for a time period not exceeding one month. The maximum sum of money payday lenders are allowed to offer is $350. Interest rates for these loans depend on the loan amount. If a borrower applies for a loan less than $50, he is to pay $5.50. Loans ranging from $50 to $100 are accompanied with a $5 fee and 10% rate. Loans beginning from $100 and reaching $250 are charged with 7% interest rate and $5 financial fee. For the loans exceeding $250 and coming up to $350 a borrower is required to pay a fee of $5 and interest rate of 6%. Consequently, the minimum annual percentage rate makes up $17.50.

There are no limits on the number of loans a payday customer is allowed to take at the same time. But any rollovers and extensions of a loan are illegal. It is either prohibited to apply for a loan at a new lending company in order to pay off the old credit.

There are some other regulations and restrictions of payday lending industry in Chapter 47.60 of the Minnesota legislation. The main goal of all these measures is to secure borrowers and their budget. Although the majority of payday lending institutions and even some Minnesota borrowers are not satisfied with the current legislation, they need to correspond to it in order to continue operating and providing their services in the sphere of payday lending. Anyway, legislators are trying to do their best to improve living standard of the State citizens.

The criteria a payday borrower needs to meet in order to get a loan aren’t strict. He is just to be 18 years old, have a permanent job in a company and receive a monthly income exceeding $1,000. Some lending firms approve those customers who have a lower income or don’t have a constant employment. Payday lenders require their customers to pay rather high percentage rates and financial charges. On the other hand, they provide more favorable terms and conditions than the majority of banks do. One of the most evident advantages of payday lending is that even borrowers with bad credit record, for whom it is impossible to receive a credit in any bank, can easily get an approval from a payday lender. Anyway, it’s of great importance to be aware of the State legislative acts and be certain that you address to a fair and reliable payday lender.

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