Payday Loans New Hampshire Laws and Legislation

Update 2009
Payday loan company Advance America announced it plans to close the 24 payday loan centers it operated in the State of New Hampshire. The decision to close the payday loan centers in New Hampshire comes after approval of payday loan legislation that went into effect on January 1, 2009 that effectively prohibits the offering of the cash advance product in that state, and follows the Company’s previously announced decision to discontinue offering its line of credit product in New Hampshire as a result of an agreement with the state’s Bank Commissioner.

Commenting on the closure of its payday loan centers in New Hampshire, Advance America’s President and Chief Executive Officer, Ken Compton, said, “The recent law that went into effect in New Hampshire imposed a 36% annual percentage rate cap on payday loans, resulting in an effective ban of the industry there. Unfortunately, eliminating the payday loan product as an option does not eliminate the need for short-term credit in New Hampshire, it simply eliminates a sensible financial choice for thousands of hardworking people, and forces them into higher cost alternatives such as fees for bounced checks or late payments and risky loans from unregulated internet lenders. We are disappointed that a majority of legislators and Governor Lynch chose to take away a viable, regulated short-term credit option from New Hampshire residents and put hundreds of employees out of work, particularly during a period of broad economic instability.”


What is a Car Title Loan?

What is a Car Title Loan?

Car title  loans, sometimes called pink slip loans or auto title loans are short term loans designed to provide consumers who own their cars with immediate funds. Car title loans usually require repayment within a period of two to 4 weeks (some may last as long as 36 months) with high interest rates so they should only be used for short term, temporary financial difficulties.

The term, “auto title loan” or “car title loan” is due to the practice of giving the lender the title to your car as collateral for the loan. If the loan is not repaid on time you risk losing your car. Auto title loans are also known as “pink slip loans” in some states because of the actual color of the car title (pink). Car title loans should not be confused with payday loans; they are two different animals.

The ultimate penalty for not repaying a car title loan is repossession by the lender. Before it goes that far however, most car title loan lenders will attempt to contact the borrower and collect payment or make suitable arrangements. Because the car title used as collateral is usually worth at least twice as much as the loan on the car, boat, motorcycle, boat, or RV, most borrowers do everything in their power to preserve ownership of their vehicle.

Unlike typical pawn shop agreements where the pawn broker takes possession of the collateral during the loan, borrowers maintain possession of their car and continue to operate their auto as they repay their car title loan.

Recovery of a car involved in a car title loan in which the pink slip owner fails to make the payments is becoming easier in today’s marketplace. The use of GPS systems (global positioning systems) that reveal a car’s position at all times in conjunction with starter interrupt systems are making it extremely difficult for car title loan consumers to avoid having their vehicle repossessed.

Many car title loan companies have two types of loans available. With Title Loans (also known as Pink Slip or “You Drive” loans), you can still keep your car to drive. With Storage Loans (also known as Auto Pawns), your vehicle is stored in a secure facility. Generally, the auto pawn consumer makes NO payments until the vehicle is picked.

Car title loans are approved in a matter of minutes regardless of credit history. A consumer’s credit report and credit history have zero bearing on receiving approval for a car title loan. The factors that do play a role are:
1) The consumer must have a job or guaranteed income
2) The consumer must have the title to their car (or the loan proceeds must be partially used to pay off any leins on the car).
3) The consumer seeking a car title loan must have the ability to pay back the loan
4) In most states the consumer must be at least 18 years old.

A typical car title loan In the state of California, for example, means you can borrow cash on the value of your auto title [pink slip], with your vehicle serving as collateral to the loan. Your credit rating or score isn’t a factor in approval, and you can borrow anywhere from $2,600 to $50,000. Your application and the loan process is kept very private and it takes less than one hour to have your cash in hand. And no matter your reasons for needing—or wanting—the money, no one will bug you with questions as to your reasons or plans for the money. In California, car title loans are typically made or arranged pursuant to a California Finance Lender’s License


Payday Loans Ontario Canada Board Recommends $21 per $100 Loaned

Payday Loans – Ontario, Canada – Board Recommends $21 per $100 Loaned

An independent advisory board has determined that the Ontario Province of Canada should place a maximum interest rate on all payday loans conducted in Ontario, Canada at $21 per $100 loaned.

The Maximum Total Cost of Borrowing Advisory Board for the Ontario Payday Lending Industry was created by the province to recommend an upper limit that would be fair to consumers while preserving a competitive payday loan industry. The Maximum Total Cost of Borrowing Advisory Board for the Ontario Payday Lending Industry was created by the province to recommend an upper limit that would be fair to consumers while preserving a competitive payday loan industry.

Its 25-page report drew its findings from a number of sources, including consultations with key stakeholders and a study by consulting firm Ernst & Young.

The board also recommended payday loans only be offered to consumers who could pay them back! What a novelty. Do they really think we in the payday loan industry willingly make loans to payday loan consumers who cannot pay us back? We are not the federal government with access to printing presses!

Canadians borrow an estimated $2 billion a year through payday loans, with Ontario home to more than half of the 1,350 such businesses operating across the country.

Other provinces have already set limits on what payday lenders can charge their customers.

Nova Scotia companies can charge no more than $31 on $100 of borrowing, fees and interest included, while Manitoba caps the cost at $17 on $100 of borrowing for loans up to $500.

Ontario, British Columbia, Alberta, Saskatchewan, Manitoba, Nova Scotia, New Brunswick and Prince Edward Island have all taken steps to regulate the industry after the federal government shifted the responsibility to them in 2007.

Quebec has effectively banned payday loan outlets by limiting the annual interest rate they can charge to 35 per cent.

Ontario: The Payday Loans Act, 2008

For a number of years, the practices of payday lenders have drawn the attention of poverty activists, consumer groups, politicians, and the media.  Federal Bill C-26, An Act to Amend the Criminal Code, was introduced in the context of the growth of the payday lending industry and the mounting concerns surrounding it.  In provinces designated under  Bill C-26, it is not the criminal interest rate that will apply to payday loan agreements  but the maximum total cost of borrowing set by the province.

On June 18, 2008, the Ontario Payday Loans Act, 2008 (the “Act”) received Royal Assent.  Under the Act, payday lenders and payday loan brokers would have to be licensed and operate within a consumer protection framework.   This framework prohibits the most controversial practices of some industry operators, such as rollovers and concurrent loans.  Borrowers  will have recourse if they have dealt with a non-compliant lender or broker and there are strong penalties for lenders and brokers operating in contravention of the Act.  Additionally, the Act provides for the establishment of a limit to the maximum total cost of borrowing.

Ontario’s new legislative/regulatory framework has been developed to adhere to the following three principles:

• To protect borrowers  who avail themselves of payday loans.
• To create public confidence in the integrity of the payday lending market.
• To develop a proportionate licensing regime that allows  payday lenders to continue to operate and serve a market that depends on their services.

Setting the Maximum Total Cost of Borrowing for Payday Loan Agreements

Federal Bill C-26 exempts payday loan agreements from the application of the criminal interest rate provision of the Criminal Code  where the principal amount is less than $1500 and the term is less than 62 days, providing that lenders are licensed and a province has received designation.  Once designated, a province sets the maximum total cost of borrowing for these payday loan agreements.  Ontario has elected to seek the advice of the Board before deciding what the appropriate maximum total cost of borrowing is for payday loan agreements in Ontario.

Under the Act, “cost of borrowing” includes the total of all amounts that a borrower is required to pay under, or as a condition of entering into, a payday loan agreement, but does not include default charges and the repayment of the advance.  This means that if someone  wishes to borrow $300, any and all amounts that they are required to pay  to receive the $300 is considered part of the cost of borrowing.  It does not matter if the charges are called interest, brokerage fees,  administration charges, or any other name; they are part of the cost of borrowing.

Payday loans have become increasingly popular since coming to Canada in the early 1990s. Though they offer quick cash when you need it, you may end up paying back more than you anticipated.

New regulations are offering stronger protections designed to provide you with the information you need to make informed decisions about short-term borrowing. These rules will help you develop a better understanding of the costs involved before entering into a credit agreement.

What is a Payday Loan?
A payday loan is a small value, unsecured loan made to a borrower who guarantees repayment with a post-dated cheque or pre-authorized debit. Lenders typically require borrowers to prove three months of continuous employment, produce a recent utility bill in their name to establish address, and have an active chequing account. No credit check is performed.

In Canada, loans typically reach a maximum advance of 50 per cent of the borrower’s net pay. The average loan in Canada is approximately $300 with a term of 10 days to two weeks.

There are approximately 1,350 stores operating in Canada, with 700 in Ontario.

New Ontario Regulations
On March 31, 2008 the Ontario government introduced the Payday Loans Act, 2008, which:

* Requires lenders and brokers to be licenced
* Provides authority to set a total cost of borrowing ceiling
* Prohibits back-to-back and concurrent loans
* Permits borrowers to cancel loan agreements without penalty within 48 hours
* Imposes serious penalties for lenders who break the act

Under the proposed Payday Loans Act, lenders will face significant penalties for non-compliance. An education fund to educate Ontario consumers in financial management and the dangers of high-cost credit would also be established under the act.

As of August 1, 2007, Ontario regulation require payday lenders to:

* Prominently display posters that disclose the cost of borrowing for payday loans.
* Use a standard form and content credit agreement disclosing the details of a borrower’s payday loan.
* Provide funds to the borrower immediately upon signing their credit agreement.

These measures will improve the consumer’s ability to compare rates before borrowing, fully understand the terms of their loan and ensure that all charges are included in the disclosed cost of borrowing.

Read more at:


Payday Loan Industry – Listen and Learn from a Payday Loan Industry Leader

You want to know what’s REALLY going on the the payday loan industry? Yes? Then listen in live to the next conference call by a major player in the payday loan industry. Pay particular attention to the end of the call when the analysts ask questions.

Here’s the announcement and the schedule released by QC Holdings Inc.

QC Holdings, Inc. Schedules Fourth Quarter and Year-End 2008 Earnings Conference CallOVERLAND PARK, Kan., Feb 03, 2009 (BUSINESS WIRE) — QC Holdings, Inc. (NASDAQ: QCCO) announced that it will release its financial results for the three months and year ended December 31, 2008 prior to the opening of the markets on Thursday, February 12, 2009, and will discuss its results on a conference call on February 12, at 2:00 p.m. EST. Stockholders and other interested parties are invited to listen online at or dial (866) 202-4683, passcode 37833917. The accompanying slides to the presentation will be available on the QC Web site prior to the conference call. A replay of the audio portion of the presentation will be available online until the close of business on March 12, 2009. The replay can also be accessed by telephone until February 19, 2009, at (888) 286-8010, code 91061220.About QC Holdings, Inc.

Headquartered in Overland Park, Kansas, QC Holdings, Inc. is a leading provider of payday loans in the United States, operating 585 branches in 24 states at December 31, 2008. With more than 25 years of operating experience in the retail consumer finance industry, the Company entered the payday loan market in 1992 and, since 1998, has grown from 48 branches to 585 branches through a combination of new, or de novo, branches and acquisitions. During fiscal 2007, the Company advanced approximately $1.3 billion to customers through payday loans and reported total revenues of $213.6 million.


Payday Loan Industry-Outlaw Bikers Take Over Loan Biz

Ellen Lutton over at Brisbane Times in Queensland, Australia wrote an interesting article regarding the payday loan industry there.
In essence, according to the author, motorcycle bikers are replacing the “mom-n-pop” payday loan locations that are going out of business because of new payday loan laws in Queensland.
No surprise here! The legislators can regulate the legitimate payday loan companies out of existence but they can’t eliminate the demand by consumers for small, non-collateralized loans! When are they going to figure this out!
Their well intended 48% rate cap in Queensland has simply driven consumers back to the real loan sharks; the ones who break legs!
Here’s a portion of the article.

NEW laws to control high-interest-loan businesses in Queensland have driven the industry underground, with outlaw motorcycle gangs now running exorbitant “payday lending” practices, an industry insider has alleged.

Pawnbrokers Industry Federation former president David Poole, who owns Ashgrove Cash Exchange in north-west Brisbane, said the State Government’s 48 per cent interest rate cap on consumer credit loans had put more than 200 loan centres out of business in the past six months.

As a result, the industry had been driven into the hands of bikies.

Queensland Police have refused to comment on the claim, citing operational sensitivities.

However, it is understood the state’s Outlaw Motor Cycle Gang (OMCG) Taskforce, codenamed Hydra, is investigating.

Mr Poole said the shift was a further blow for the industry, which had suffered badly from negative publicity.

“There’s now a criminal element to our industry that was not here before,” he said.

“Most pawnbrokers are honest, family-run businesses but almost immediately after the interest-rate cap was introduced, the bikies took over that type of lending and it’s gone underground.”

Since July 31, a maximum cap of 48 per cent a year has applied to consumer credit contracts in Queensland.

The cap includes fees and charges on the loan.

The laws were designed to protect vulnerable consumers who had been subject to rates up to 1600 per cent from some payday lenders.

Mr Poole said the cap had impacted heavily on lenders’ profits and the fallout from the closure of many businesses was “huge”.

“We’re talking over 200 mostly family-run business forced to call in on all their loans, each business with hundreds of loans,” he said.

“Can you imagine how devastating that is for the poor clients being called in, having to come up with the money all of a sudden?”

Read the entire article here:

Brisbane Times of Australia…