Loans in the USA

Loans in the USA

The bulk of our content surrounds subprime lending within the UK. However, we recently conducted some research on short term lending across Europe. For this we Picked Out Poland where the market is growing quickly. We will now move on to study loans in the USA where the payday loan boom originally sparked. America is a vast market with a population approaching 319 million. However, payday loans are banned in some states and others see harsh price restrictions. The 2015 UK cap is 0.8% daily as a total charge, but the restrictions here are usually APR caps and so there isn’t too much profit available for the lenders.

This is a big reason why many moved over to Britain that we covered in more detail Here. There is no language divide and so it will be much easier to work through this location, although the legal restrictions can be confusing. The eventual aim is to get a clearer picture of short term lending from a global perspective, rather than just a local one. Our approach to cover loans in the USA matched that of Poland and so we covered 10 of the most popular lenders. We won’t include any instalment companies (or installment as they spell it) such as Avant Credit, One Main Financial and Rise Credit.

Picking the actual lenders was easy as I am aware of many of the major firms. Cash America operates as CashNetUSA, DFC Global has MoneyMart and The Check Cashing Store, whilst Speedy Cash is also well known. Some companies introduced will also have a store presence. When comparing costs, we will look at California since it is the largest state. We will typically look at the price for a monthly period at 100$ (£62). In California the cap is set at 15% on the balance/check that can be no higher than $300 that creates a maximum fee of 45$. The lender gets this fee and you receive $255 max.

To calculate the maximum cost per $100, take $255/$255 = $1 and then $45/$255 = 0.17647 (there were more digits, but the next one was a zero and so we’ll round it off there). What we have done here is to scale down the cost to a dollar. If we then x100 we will have $1 x100 = $100 and 0.17647 x100 = $17.647 (rounds off to $17.65). No more than this sum can be charged. The problem lies that lenders can charge this amount even if you are being paid in say 12 days time that can head up to 31 days max (another cap). Hopefully we will uncover firms that do charge daily rates, but from the initial ones featured we have seen a common trend whereby they are just attaching a fixed $17.65/$100 charge.

Currently Featured:

ACE Cash Express
Advance America
Cash Central
Check Into Cash
Check N Go
Money Mart
Speedy Cash

We have now added a summary post covering the top CA rates for those above. View This Here.