Ohio Internet Payday Loans

Banks and other financial institutions, including online payday lenders are under investigation by some states for allegedly illegally offering Internet payday loans. Ohio Internet payday loans may be illegal if they violate Ohio Consumer Protection Laws, which require short-term lenders to follow certain rules when lending to Ohio residents. Furthermore, banks and other financial institutions may be in violation of Ohio or federal Consumer Protection Laws if their practices allow Internet payday lenders to continue operating illegally.

Each state has its own consumer protection laws and regulations that cover how financial institutions operate. In Ohio, the Short-Term Lender Law (2008), also called the Payday Lending Law, limits payday loans to an annual percentage rate of 28 percent. It also prohibits unfair debt collection practices and requires that online lenders have a location in Ohio. Finally, it requires that borrowers have a month to pay back their loans—not just until the next payday.

Ohio payday lenders typically offer loans with an expected payback of the borrower's next payday. But these loans often come with high interest rates. Furthermore, some Internet payday lenders have been accused of automatically renewing the loan if the borrower does not state his or her intent to pay the loan back in full. In some cases, Internet payday loan companies are accused of making unauthorized withdrawals or withdrawing unauthorized fees and charges from the borrower's account.

Because Internet payday loan companies operate online, they may be breaking the law by offering loans in states in which they are not properly licensed or in which their interest rate is too high. Some online payday loan companies that provide loans in Ohio have annual interest rates at or near 700 percent.

Meanwhile, if Ohio banks or other financial institutions allow Internet payday lenders to continue to operate illegally in Ohio—for example by allowing automatic withdrawals from borrowers' accounts without the borrower's consent—they may also face lawsuits and investigations into their actions.

Some states have filed lawsuits against Internet payday loan companies alleging those companies operate illegally in their state, by not having the proper license and/or charging illegal interest rates. Meanwhile, consumers have filed lawsuits against some banks, alleging those banks facilitate the offering of illegal loans by allowing companies unauthorized access to customer accounts.

Ohio Internet Payday Loan Legal Help

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Published on Jan-17-14