A payday loans is a small amount, short term unsecured loan that is used when there is an urgent need for additional cash. They are referred to as payday loans, payday advance or cash advance loans, as they are often to be paid back within a month, most often on your next payday.
California State rules on payday loans
|Interest Rate (APR)||460%*|
|Maximum Loan Amount||$300|
|Minimum Loan Term||Not Specified|
|Maximum Loan Term||31 days|
|Number of Rollovers Allowed||0|
|Finance Charges||15% of the amount advanced|
The state of California has set a $300 limit on all lenders for payday / cash advance loans, and must be repaid within 31 days of the loan being issued. For each $100 borrowed, the most the lender is allowed to charge is $15, so you repay $115 for $100 loan. If you need an extension to repay the loan, the lender is not allowed to charge you any extra but this may show on your credit file and they can not roll it over in to a new loan.
Although the state rules in California protect you from any high charges, if you do have problems repaying the loan on time, this can affect your credit file.
Before you take out a payday loan, always make sure you need it and that you can afford to repay the loan on the date you agree with the lender. Learn about payday loans.