It is a well known fact that many states have set up regulations for payday loan companies to follow. Companies are required to follow these rules which were set up to protect customers from predatory lenders. There are certain lenders who do not fall under these regulations and the online payday loan industry is creating big business opportunities from people stuck with loans which they cannot afford to pay off due to high fees and interest rates.
Offshore companies do not have to follow the guidelines set by the state government. If I am a person from a state who has a set limit on how much I can borrow, and I apply for an online payday loan from an online lender located outside of the country, I will not be protected if something goes wrong and I need to file suit against the lender. It would be in your best interest to apply for an online payday loan from a company who follows regulations.
Tribal-based payday lending companies were initially set up to loan money to tribe members from a store located on their tribal grounds. Because of sovereign immunity, which legally protects tribal businesses from U.S. state regulations, anyone outside of the tribe who entered their store for a loan would not be protected from the state regulations. The tribal-based companies have jumped into the online payday loan lender community and now offer their loan services to anyone who wants to apply. With this practice, similar findings occur as with offshore businesses that these loan amounts are not capped, and fees and interest loans are much larger.
For starters, many people who are looking for a quick cash amount via an online payday loan, need or want more than what the state allows. These companies can and do misrepresent their fees and interest and, once again, the customer is not protected by law. Fair Collections Act also does not apply when the loans go bad. These loans often go bad. With a high fee added to the loan amount, payoff day falls plenty short for most of their customers. Since the loans are set up to have short-term cycles, high interest rates quickly add up fast. The customers who were excited to get larger loan amounts have now gotten themselves deeper in debt with no government support.
Additional worries have come about with tribal-based companies as to who is truly behind the business. There has been one Kansas businessman and others who have a case filed against them as being ghost owners sitting behind the scenes as tribal-based companies run his business without U.S. laws regulating the company. The Federal Trade Commission worries that this is not the only example of such practices.
Getting a loan from an online payday loan company is a pretty simple process. Spotya! Online Payday Loan is a trustworthy company who follows all state regulations and offers some of the lowest fees in the industry. Do your homework when it comes to your finances and shop around. Read the fine print and expect answers to your questions. When it comes to your money, make the best educated choices for your own protection.