A friend of mine asked to borrow 500.00 i didnt have it so he used the internet to get a 500.00 loan its costing him 200.00 every 2 weeks 150.00 for intrest and 50.00 torwards the principal is this illegal?
2007-04-27 13:32:20 · 5 answers · asked by wjaandsonpainting 1 in Business & Finance ➔ Credit
when i say borrower what i mean is the person who borrowed the money.
2007-04-27 13:37:31 · update #1
There is no Federal law. All states have usury laws that limit interest rates to much less than that rate. I agree with those that mentioned Payday loans. The problem is, they don't charge 'interest'. They charge 'fees'. Its the same thing to your friend, but not to the 'letter of the law'.
2007-04-27 14:43:18 · answer #1 · answered by STEVEN F 7 · 0⤊ 0⤋
While that is covered by individual states usury laws, it is probably an off-shore company. Though there is probably not much that can be done, other than paying it off immediately, I would contact your state Attorney General's office. They will be able to give you an answer on whether you have recourse in your state.
2007-04-27 15:10:12 · answer #2 · answered by joeiselvis 3 · 0⤊ 0⤋
Did he go to one of those payday loan companies? They are not regulated the same way that a credit card company is - he's on the hook for his bad decision!
2007-04-27 13:40:33 · answer #3 · answered by Anonymous · 0⤊ 0⤋
there was once upon a time,but congress threw out those rules back in 1980.Sounds like your friend is getting money from a payday loan place
2007-04-27 13:37:53 · answer #4 · answered by cokezero100 3 · 0⤊ 0⤋
It is legal unfortunately. Usurious, but legal.
2007-04-27 13:35:24 · answer #5 · answered by Still reading 6 · 0⤊ 0⤋