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How Payday Lenders Get Around Interest Regulations

How Payday Lenders Get Around Interest Regulations

Although a number that is increasing of has passed away legislation to guard customers by capping interest levels on pay day loans, loan providers have discovered imaginative techniques for getting around those laws and problem loans with sky-high prices.

“We see payday loan providers using schemes merely to move out from as numerous forms of limitations as they possibly can,” said Diane Standaert, manager of state policy in the Center for Responsible Lending, a nonprofit, nonpartisan organization dedicated to customer financing.

Listed below are three strategies that are common used to exploit loopholes: