Despite Regulations, Payday Loan Stores Abundant in Ohio
By J.J. CameronPayday Loan Writer
Over ten years ago, Ohio passes a series of laws meant to regulate check cashing and payday loan companies across the state. Controls may have taken hold, but businesses of this nature have still sky-rocketed in abundance.
Since 1995, there have been 1,398 payday offices licensed in Ohio. They seem to be operating legally and fairly, however.
Melissa Padisak, a spokeswoman with the Better Business Bureau of Mahoning County, said her office has not received many complaints about area payday loan centers committing fraudulent actions.
Nevertheless, consumers should be wary about using no credit check payday loan businesses, she said.
‘‘The problem with these places is they can charge triple-digit interest rates,’’ Padisak told The Tribune-Chronicle.
Nancy Gray, director of the Warren office of Consumer Credit Counseling, said her office has been seeing a lot more people coming in with problems with payday loans.
‘‘Those who find themselves in a position in which they must chronically go to payday loan offices have budgeting problems,’’ Gray said. ‘‘We counsel our clients that they always must pay themselves first. They must establish savings accounts so they will have money set aside for emergencies.’’
Gray emphasizes that the way people chose to handle their finances is a matter of how they choose to set their priorities.‘‘Emergencies are going to happen in life,’’ she said. ‘‘It does not matter how much a person makes. It is how they spend that is the answer. Those who have budgets that maintain some savings often can usually find ways to keep above water.’’
Those who find themselves in a position where they must use online payday loan sites or offices should carefully read all contract carefully, Gray said.
In Ohio, payday loans can be as short as two weeks, but their terms can be as long as six months.
When Ohio laws initially were passed, the payday loan businesses could provide payday loans of no more than $500, with loan origination fees of $5 per $50 borrowed and 5 percent interest per partial or full month. Ohio’s law was changed in 2005 to allow consumers can borrow up to $800.
For those seeking payday advances that are greater than $500, the loan origination fee is decreased to $3.75 for every $50 greater than the initial $500.
However, there is no regulation preventing someone from taking a loan from one payday loan office to pay off another. This is why some in Ohio have pressed for further regulatin on payday loans. The issue will most likely not go away any time soon.
