Payday Loans and Fraud – Don’t Let This Happen to You

THIS IS A MUST DO as a payday loan store owner!!

Go into your location.

Make certain your primary employee(s) are AWARE of what you’re about to do. Make certain they see and hear your every move!

Pull up a customer contract on your computer or pull out a copy of a printed one.

Call the customer.

Here’s what you say:


I see you we’re here in our store on, “DAY OF WEEK and CONTRACT DATE.”

“I’m simply calling you to thank you for your business CUSTOMER NAME and make certain there isn’t anything more we can do for you.”

Then SHUT UP! Just listen!!

Hopefully, your customer will describe a pleasant experience at your store.

If things are in disarray your customer may describe a rude employee.

If things are really bad in your store, this customer may tell you they have not been in your location for the past six months, or one year or…

Employee fraud is occurring! It’s not uncommon, believe me!! When performing audits for clients wanting to buy or sell their payday loan business, we’ve found as many as 22% of the contracts are bogus. They never occurred! The employee(s) made them up!

We audit our stores. You must audit your store(s)!

Your employee(s) must be aware you perform this task RANDOMLY! UNANNOUNCED!! FREQUENTLY!!!

Not only is this a great way to get a real feel of how your business is doing but, just as importantly, you’ll eliminate EMPLOYEE TEMPTATION and generate new ideas for products and services your existing customers want and need.

DO THIS! Do it this week.

And of course, if you can’t reach them by telephone you can text them, you can email them, you can leave a voice message, etc. A critical element of this exercise is for your employee(s) to be aware you do this.

Then email me. I want to know how it went! I REALLY WANT YOU TO DO THIS!!

And if you need help with any part of your business visit our “Vendors & Suppliers”



How Does a Car Title Loan Work

This is a brief summary of a car title loan transaction. The exact details will vary depending on the state or province the car title loan takes place in. For a thorough discussion of how to make money in the car title loan industry, refer to our “Car Title Loan Business Start Up Manual.”

A customer who owns their car outright and has the title or “pink slip” drives their vehicle to your location. Most of us who make car title loans require at least the following from our customer:

  • A clear title to the car without liens or encumbrances
  • A duplicate set of keys
  • Proof of insurance including collision
  • Driver’s license
  • Phone bill
  • Proof of employment
  • Last 1-2 bank statements
  • Last utility bill
  • A minimum of 3 references with their complete contact information

Car title loan software is highly recommended for the above.

After the car title lender confirms the accuracy of all the application information (there are a multitude of data bases to perform these verifications) and verifies the “low-book” value of the automobile the car title loan is approved. Typically, the amount loaned on the vehicle (motorcycle, car, boat or RV) is 25% to 55% of this “low-book” value.

The car title loan consumer typically has 30 days to repay the loan principal and fees. Fees average 30% per month on the face amount of the car title loan. Of course, this varies greatly depending on where the car title loan takes place.

If the car title loan consumer is unable to repay the principal and fees on the date due, the car title loan lender usually collects the fees and agrees to extend the principal due date another 30 days.


More on the Arizona Payday Loan Industry

There’s some interesting commentary going on over at Arizona’s Own Expresso Pundit regarding the Arizona payday loan industry. Be sure to read the Comments Section; very enlightening! You’ll gain insight into how various state political machinations behind the scenes affect our industry. Of course, no surprises there.


Payday Loans: No More Fear – 100% Guaranteed Collections

Here’s a “Quick Hit” about how you can get every single one of your payday loan customers to pay you back with a 100% guarantee for every loan your payday loan business makes.

100% Guaranteed Payday Loans

Have you thought about adding payday lending to your business?  Are you doing Payday Loans but not getting the return you deserve? Or, are you thinking about getting into the payday loan business but afraid of the losses and collections?

Allow us to 100% guarantee your payday loans.  Once we have approved a loan, if it goes “bad” just send the check to us and we will put the principle and interest back into your bank account.  You have your money from us within 5 to 6 business days and ready to put back on the street.

If  you are utilizing a collection company now:

* It typically takes 90 to 120 days for them to collect

* They generally collect less that 50% of the checks you submit to them.

* That’s 90 to 120 days you don’t have use of that money

* And 50% of your money you will never see again.

* How many times can you turn that money in 90 to 120 days if you had access to it?

Would you like to explore this? Email your contact info to explore

Additional payday loan collection resources:

This Newsletter probably received more responses than almost everything I’ve previously written about. (and we have over 4000 readers!)
It’s heavily focused on collection tactics using some of the latest techie tools available.

I’ve written about some of the newest techie tools

Which bills a consumer will pay first. How different bills rank in consumers’ stacks, Get Your Customers to Pay You First:

How and why Text Messaging can help your Collection efforts INCREASE up to 25% or more and your payment defaults DECREASE by about 40%, as well as generate new leads and create repeat customers.


Arizona Payday Loan Laws and Legislation

Payday lenders in Arizona are reviewing creative methods to remain in business after the June 30, 2010 ban of the payday loan industry.

Payday loan lending businesses are now prohibited from operating in the state and, as a result, many Arizona payday loan lenders are considering converting to car title or auto-title loans and check cashing operations, which may be legal under Arizona law. Payday loan lawyers and compliance experts are researching these business models now.

Our clients and others are weighing the advantages and feasibility of switching to car title or auto title loans in order to continue to serve their customers. Demand for simple, no-hassle, minimum documentation micro-lending products remains huge! Unfortuately, Arizona Regulators fail to realize this demand. So, the Regulators simply outlawed payday loans leaving thousands of Arizonan’s without access to $300 to $1500 loans.  Check cashing services have also grown amid tighter state regulations.

The payday loan industry faces increased regulations from many states. Payday loan lenders narrowly escaped the financial regulatory reform bill, which would have required federal oversight of the payday loan industry. Millions of consumers through out the country welcomed this development as their ability to choose the payday loan product to solve short-term financial problems is a high priority.