Mortgage Lending: 8.4.6.1.1 General
Section 2607(c) of RESPA carves out separate treatment for “affiliated business arrangements” (originally called “controlled business arrangements”).
Section 2607(c) of RESPA carves out separate treatment for “affiliated business arrangements” (originally called “controlled business arrangements”).
Spokeo and Ramirez hold that an intangible harm is sufficiently “concrete” to support Article III standing if it has a close relationship to a harm traditionally recognized as a basis for a lawsuit in English or American courts.385 In practice, this will most often mean looking for a “common-law analogue.”386 In addition to monetary injury, there are a number of common-law analogues for the harm caused by a section 2607 violation.
A debt collector may not use any false, deceptive, or misleading representation or means in connection with the collection of any debt. Without limiting the general application of the foregoing, the following conduct is a violation of this section:
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(6) The false representation or implication that a sale, referral, or other transfer of any interest in a debt shall cause the consumer to—
An important potential defendant in a UDAP action is the party holding the consumer’s credit or lease obligation, even if that party was not itself involved in any wrongdoing.
Massachusetts law prohibits engaging in the business of making small loans unless licensed under the state’s small loan law.324 The Small Loan Act prescribes a rate cap of 23% per year and allows an administrative fee of $20, which cannot be assessed more than once during any twelve-month period.325 The rate cap effectively prohibits payday lending in Massachusetts.
Payday lending is authorized in Michigan by the Deferred Presentment Service Transactions Act.329 A payday loan lender may not make more than one loan at a time to a particular borrower and may not make a loan to a borrower if that borrower already has more than one outstanding payday loan in effect with any lender.330 A lender is not allowed to renew a loan; however, a lender may extend a loan as long as no fee is charged for that extension, and the balance owed is equal to the amount owed on t
Minnesota has two statutes authorizing payday lending. The first, Minn. Stat. § 47.60, authorizes loans of $350 or less, repayable in no more than thirty days.335 These are termed “consumer small loans.” It allows the lender to charge $5.50 on any amount up to $50.
The Mississippi Check Cashers Act351 authorizes payday lending. While this statute was previously scheduled to sunset in 2012, the date of repeal was extended by amendments enacted in 2011 until July 1, 2015. However, with the reenactment of the Check Cashers Act in 2013, the repealing language was deleted.352
Missouri law authorizes payday lending.361 A lender may make a payday loan of up to $500,362 but may not have more than that aggregate amount in loans outstanding to the same borrower at any one time.363 A lender is permitted to make up to six renewals of a payday loan and the finance charge is capped at 75% of the loan.
Payday lending is authorized by statute in Nevada,391 but the practice is subject to a number of restrictions.
Payday lending is technically legal in New Hampshire but has been eliminated by a 36% rate cap.410 The statute provides that a lender may not loan more than $500 to a given borrower,411 and a lender may not make more than one loan at any time “for the purpose of increasing charges.”412 Additionally, a lender is not permitted to make a loan to a borrower who currently has, or has had within the previous sixty-day period, an outstanding payday or tit
In New Jersey, a licensed check casher may not cash or advance money on a postdated check.420 This limitation in and of itself does not prohibit payday loans in New Jersey, as lenders may still conceivably make loans in the state pursuant to the Consumer Loan Act.
Payday lending used to be authorized by statute in New Mexico, but in 2017 the legislature enacted small loan law reforms that effectively eliminated short-term payday loans.424 The amendments, which became effective on January 1, 2018, limit the maximum finance charges on all installment loans under $5,000 to an annual percentage rate of 175%.425 An installment loan is defined as one that is to be repaid in a minimum of four substantially equal payments of principal and interest with an initial
In New York, an individual licensed as a check casher may not make loans or cash or advance any moneys on a post-dated check unless it is a government check or payroll check.436 While a lender could conceivably make payday loans under the Licensed Lender law, which allows any interest rate agreed to by the parties, New York’s criminal usury cap of 25%437 effectively prohibits payday lending in the state. Usurious loans are void in New York.438
In 2001, laws authorizing payday lending in North Carolina were allowed to sunset.441 The loans that were formerly covered under the statute now fall under the state’s consumer finance act, which sets an interest rate schedule: for loans not more than $10,000, 30% per annum on the unpaid principal balance not greater than $4,000, 24% per annum on unpaid principal balance more than $4,000 but not more than $8,000, and 18% per annum on unpaid principal balance.
Payday lending is legal in North Dakota under the Deferred Presentment Service Providers Act.445 The statute imposes several restrictions on lenders.
The laws governing payday lending in Ohio were revamped in 2018. Payday lending is now permitted under the Short-Term Lender Act (STLA).454 The Act allows for loans of up to $1,000 with a maximum term of twelve months.
Oklahoma repealed its payday lending statute effective August 1, 2020.472 Until then, payday lending was legal in Oklahoma under the Deferred Deposit Lending Act.473 According to the Act, a lender was restricted from making a loan for more than $500,474 and could not make a loan if the borrower had more than one outsta
Payday lending is legal in Oregon.483 The law specifies a maximum loan limit of $50,000484 and a maximum interest rate of 36%, excluding a one-time origination fee for a loan.485 The law also states that a lender may not grant more than two renewals,486 and must comply with a cooling-off period of seven days after the date on which a consumer fully repays the previous payday loan before making a new p
Pennsylvania has not legalized payday lending. Check cashers are specifically prohibited from making payday loans under the Check Casher Licensing Act.489 Therefore, the Consumer Discount Company Act applies.490 The interest rate cap prescribed under this statute effectively prohibits the practice of payday lending in the state.
Payday lending is not authorized by statute in Puerto Rico. Small loans are governed by the Small Personal Loan Act,493 which provides that the maximum rate of interest is established by the Financial Board of the Financial Institutions Commissioner’s Office.494 This cap on rates effectively bans payday lending in Puerto Rico.
Payday lending is legal in Rhode Island.495 The law imposes several restrictions on lenders.
Payday lending is authorized in South Carolina under the Deferred Presentment Services Act,501 but the statute imposes some restrictions on lenders.