Indiana Payday Loan Laws

Indiana payday laws are cited in Ind. Code §§ 24-4-4.5-7-101 et seq. for the protection of their residents.

• Maximum Payday Loan Amount – $550 dollars or up to 20 percent of borrower’s monthly income
• Minimum Payday Loan Terms – 14 days
• Maximum Payday Loan Terms – Unspecified
• Maximum Quantity of Outstanding Payday Loans – Two, not from same payday lender
• Maximum Amount of Payday Loan Extensions – None
• Maximum Payday Annual Percentage Rate (APR) – 390 percent
• Maximum Payday Financing Interest Fees – $15.00 dollars
• Maximum Payday Annual Financing Interest Rates – Between 10 percent to 15 percent
• Maximum Allotted NSF Check Fees – $20 only once
• Maximum Allowed Criminal Actions – None

There is one very deceptive practice Indiana payday loan companies utilize in order to maximize the amount of money they take from needy customers. Payday lenders will find creative charges to work into the loan agreement, such as a credit history investigation charge. The lenders will never do the investigation and pocket the money.

Also, the payday loan company owners will open a second business such as a vehicle title loan service. Then, only approve a lesser amount than what the customer needs and suggest them to go to their other business. This way the lender has bypassed the one loan per a lender law completely. They are still able to collect their high interest rates and the get a piece of collateral out of it as well.

Other commonly used loopholes are prepaid debit cards with allowable overages, lenders operating online only from out of state or county locations, check cashing schemes, and hiding the fees associated with the payday loan. These dishonest practices make it very hard for the consumer to get out of debt with a payday lender, especially if they are not subject to the above laws and regulations set my Indiana lawmakers.

The world of payday lending it dangerous enough for Indiana residents to get involve with in the first place, but when deceptive lenders are tossed in, the consumer is pretty much doomed financially. These loans already lead many to have to file for bankruptcy in many cases, because of the triple digit ARP and high fees. To avoid these predatory lending loopholes, all Indiana consumers in need of financial assistance will be better off looking to a local bank and or setting their own bank account up with a few hundred in overdraft protection for unexpected bills and emergencies.

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