Utah is one of the states in the US that doesn’t have any capping either on interest rates or the amount you can borrow. Most of the borrowers are reeling under payday loan debt due to triple-digit interest rates and no capping.
The interest rate can go up to 658% for a payday loan of $300! And usually, the loan term is up to 70 days (10 weeks). And criminal actions against borrowers are prohibited.
However, payday lenders can sue you in court for defaulting payments. And if a judgment goes against you, you may get arrested! But that can only happen if you fail to respond to court summons!
Payday loans are very popular in Utah. And the payday lending business is soaring high, making the payday lenders very happy about the existing laws in the state!
Let’s check out what the people from various cities in Utah are saying about their payday loan related problems!
Scenario 1:
Hi! I am Linda from Salt Lake City, Utah. I am trapped with 5 payday loans. The total outstanding payable amount is around a whopping $7,500. Plus, I have got some credit card debts worth $5,300. So, I am planning to file for Chapter 13 bankruptcy. Can I file payday loans on Chapter 13? Will there be any problem?
Solution:
Hey Linda! Yes, you can file your payday loans on Chapter 13 bankruptcy. Your 5 payday loans will be considered as unsecured debts. And you can get rid of them through a court-structured repayment plan with your future income.
So, make sure that you have a regular income to make payments for the repayment plan, which is one of the eligibility criteria for filing Chapter 13 bankruptcy.
However, I would say that bankruptcy is often considered as the last resort to get rid of your debts. So, have you looked for other options like payday loan debt consolidation or payday loan debt settlement to repay your payday loans (pdls)?
Scenario 2:
Hey! This is Jordan from St. George, Utah. I have taken out a payday loan from Check City worth $800. While taking out the loan, I was informed that the loan would cost me 25% if I can’t pay it within 2 weeks.
But the loan documents are revealing that the APR is around 652%. I am just shocked to see that. I badly needed the money for emergency repair work at home. So, I didn’t check it minutely while taking out the pdl.
How will I repay my payday loan? Can you please help me out?
Solution:
Hi Jordan! The APR stands for Annual Percentage Rate. That means, it is calculated annually. Whereas, a payday loan is usually a two-week loan. So, you have to repay it after 2 weeks. If your lender is charging $25 for every $100 borrowed, you have to calculate the interest rate for 2 weeks.
In your case, the daily interest = 25/14 = $1.78
Annual Percentage Rate = (1.78*365) = 651.78%
So, in your loan documents, the mentioned APR is correct. But let me tell you, these high APRs are the worst parts of payday loans.
You need to pay off the full amount along with finance charges by its due date (usually within 14 days).
If you can’t afford to pay, don’t roll over your payday loan or don’t take out a new payday loan to pay off your existing pdl.
You can talk to your lender and request an Extended Payment Plan (EPP) to repay your payday loan over a period of time without any extra interest or penalty! Also, you can check out the 5 legit ways to get out of payday loan debts to know more.
Scenario 3:
My name is Joe and I stay in Washington, Utah. I have got 4 payday loans worth $4,000. I have to make bi-weekly payments of $800. By doing so, I have drained away all my money to make payments for my payday loans. Still, I owe about $1,500 for my pdls. I want to lead a debt-free life!
How can I get rid of my payday loans fast?
Solution:
Hi Joe! Can you help me by telling me the name of your lenders? The reason being, it’s important to know whether or not the lenders are legal in Utah.
If they aren’t legal, you don’t need to make any interest payments. Just pay off the principal amount.
But if your pdls are legal, you need to look for strategic ways to get rid of your payday loans faster.
So, I would suggest you opt for a payday loan debt settlement program. But make sure to approach a genuine debt settlement company.
The expert financial advisors will negotiate with your lenders to reduce the outstanding payable amount and waive off any late fees or penalties.
Once your lenders agree, you can make a single payment every month for your 4 payday loans. And once you accumulate the settled amounts in a trust account, a lump sum amount will be paid to repay your payday loans.
Hopefully, the payday loan debt settlement program will help you to get rid of your pdls faster and with ease!
Scenario 4:
My name is Oliver from Orem, Utah and I have taken out 2 payday loans from Green Plains worth $1,400 for funding my trips a few months ago. I have been making payments for my payday loans. But a few days back, I came to know that Green Plains is not a legal payday lender. So, when I said that I won’t make any interest payments, they are threatening to sue me. Is it possible for an illegal payday lender to sue me?
Solution:
Hi Oliver! Yes, Green Plains is not a legal payday lender in your state. So, you are not legally bound to make any interest payments. You just need to pay the principal amount. That’s it.
They can’t sue you or get you arrested as they are illegal payday lenders. So, don’t be scared as they are threatening you. Tell them on their face that you won’t make any interest payments.
If they continue threatening you,file a complaint here. Besides, I would suggest you close your account for which you have given ACH authorization. By doing so, the lenders won’t be able to withdraw funds from your account!