Georgia Payday Loan Laws

Georgia’s Industrial Loan Act Code Ann. § 7-3-14; §§ 16-17-1 et seq. Ga. Comp. Rules and Regulations 80 3-1.02(7) makes payday loans illegal in the state. In addition, any lender caught giving out payday loans in the state are subject to civil and criminal penalties.

• Maximum Payday Loan – Prohibited
• Maximum Payday Loan Annual Percentage Rate – Prohibited

Georgia has tried to do the best for their residents by prohibiting payday lenders form doing business in their state. However, these avaricious lenders have found a way to skirt around the laws. They prey on the most desperate of Georgia’s residents. Unfortunately, making payday loans illegal under the law has not help the situation.

Payday lending companies are using common loopholes to bypass Georgia payday laws. For instance, they will operate under a check cashing business that cashes personal checks. Then, they will charge a huge cashing fee and many times “hold” the check a few days before depositing it. This is in essence the same thing as a payday loan without the Annual Percentage Rates (APR) or financing interest rates tacked on. There have even been cases where they lenders will allow the customer to purchase prepaid debit cards with a personal check and hold the check until their client’s payday. Another trick used by payday lenders is to offer the prepaid debit cards with an overdraft protection for several hundreds of dollars.

Payday lenders are always on the lookout for new ways to get around the laws. They can be very clever in their tactics. One such example is to operate online from another state or country where payday loans are legal. This way Georgia residents are able to take out the high interest loans and the lender is not subject to civil or criminal actions. Ads such as No Faxing Payday Loans, No Credit – No Problem Payday Loans, and Instant Cash in Your Account – No Faxing are all signs of a payday lender taking advantage of this loophole. If they allow Georgia residents to take out a loan with them, he or she will become caught in a spin cycle of high interest debt.

Many advocates against payday loans want Georgia lawmakers to make it illegal for any online companies to do business with their residents as well. However, there are no current bills in the works for this. Therefore, until that time comes, payday loan services will continue to operate outside the parameters or Georgia payday laws.

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