Tuesday, September 01, 2009
Lyn Peters, Director of Communications
PH (360) 902-8731 firstname.lastname@example.org
Deb Bortner, Director of Consumer Services
PH (360) 902-0511 email@example.com
FOR IMMEDIATE RELEASE:
Consumers Should Make Sure They’re Working With A Licensed Payday Lender Before Signing Agreements
Some Unlicensed Online Payday Lenders Are Offering Services That Are Illegal In Washington
OLYMPIA – The Washington State Department of Financial Institutions (DFI) urges consumers to verify the licensing status of any payday lender they’re considering taking a loan from. State law requires all payday lenders — including Internet payday lenders — offering services to Washington residents, including online payday lenders, to be licensed by DFI before doing business in our state. Some online payday lenders offer services that are not legal in Washington State.
In addition to verifying a payday lender’s license, consumers considering a payday loan should also be sure they are aware of and understand the current and pending laws concerning payday loans. Starting Jan. 1, 2010 new payday lending laws and regulations go into effect. Under the new laws:
- You may only borrow a total of $700 or 30% of your gross monthly income — whichever is LESS.
- Your information will be registered in a statewide database, ensuring that all payday lenders in Washington have your most up-to-date loan information.
- You may only take eight (8) payday loans per 12-month period.
- If you unable to repay your loan on or before the day it is due, you need to notify your payday lender. Your lender is then required to offer to allow you to pay back your loan over a period of 90-180 days depending on the size of the loan. The installment plan will not incur additional fees.
- If you have an installment plan you may not have another loan.
- Lenders may NOT harass or intimidate you when collecting a loan. If you are harassed, contact the Washington State Department of Financial Institutions and file a complaint.
If you are having trouble maintaining a budget, contact your local Asset Building Coalition for information on workshops that will give you the tools necessary to develop and stick to a realistic budget for you and your family. Find your local Asset Building Coalition at www.washingtonabc.org/node/29. You may also wish to speak with a non-profit counselor. Find one year you by contacting National Foundation for Credit Counseling at http://www.nfcc.org/FirstStep/state_locate.cfm and enter “WASHINGTON” or call 1-800-388-2227.
Know what you can afford to pay back, make sure you understand what you’re agreeing to and what your options are before signing any loan agreement. Verify a lender’s license and learn more at http://www.dfi.wa.gov/consumers/education/payday_loans.htm.
www.dfi.wa.gov ▪ 360.902-8700 ▪ 877.746-4334
The Washington State Department of Financial Institutions regulates a variety of financial service providers such as banks, credit unions, mortgage brokers, consumer loan companies, payday lenders and securities brokers and dealers. The department has won numerous awards for its financial literacy and outreach programs developed to protect consumers from financial fraud. In addition to posting information about licensees and administrative actions, the DFI’s Web site features consumer tips on a variety of financial fraud-related topics. DFI also hosts a financial education blog http://finlit.blogspot.com, a financial education Twitter page http://twitter.com/fined4all, a financial education YouTube page (where we've compiled a host of financial education videos from a variety of reliable resources) http://www.youtube.com/wadfi, a consumers Twitter page http://twitter.com/dficonsumers and a financial education calendar for Washington State http://dfi.wa.gov/financial-education/calendar.htm.
About Consumer Services
www.dfi.wa.gov/cs ▪ 360.902.8703 ▪ 877.RINGDFI (746.4334)
The mission of the Division of Consumer Services is to protect consumers from illegal and fraudulent lending practices. The division accomplishes its mission through licensing, licensee examinations, investigations, and enforcing selected state and federal statutes and rules. Consumer Services regulates the business activities of consumer loan companies, mortgage brokers, money transmitters and currency exchangers, as well as check cashers and sellers, also known as "payday lenders." The Division is entirely self-supporting, with funding provided by licensing, auditing, and policing of regulated businesses and individuals. No money is received from the state General Fund or other public revenue source.