How Much Can a Borrower Get with a Payday Loan in Ohio?
Borrowers can’t get over $1,000 and apply for more than one payday loan at a time in Ohio according to the Ohio Rev. Code Ann. 1321.35 et seq.
The Cost of a Payday Loan in Ohio
- APR of more than 28% is forbidden in Ohio.
Under 15 U.S.C. §,1606 interest may be calculated provided that it does not exceed an APR of 28%.(Ohio Rev. Code Ann. 1321.35 et seq.)
Yet APR for payday loans could amount to 677% until recently (According to the Center for Responsible Lending 2019
- Presently, the cost of the loan (including the fees and interest) is not allowed to be more than 60% of the loan’s original principal.
- A monthly maintenance fee can be charged by lenders, which is the lesser of 10% of the loan’s principal or $30.
- Lenders can get 2% origination charge for a loan of $500 and more; no interest is charged on the loan origination charge.
- Lenders should comply with an ability-to-repay (ATR) requirement in case of loans under 90 days. Therefore, over 7$ of a borrower’s monthly net income or 6$ of gross income for a monthly payment is forbidden, whichever is greater.
With a 91 days term:
Loan cost: $100* 677%* (91/365)=$168.8
To return: Principal+Loan cost=$100+$168.8=$268.8
How Long Should Borrowers Repay a Payday Loan in Ohio?
- Borrowers can get the loans for a period from 91 days to 1 year.
- Ohio forbids rollovers.
Lenders don’t need to check borrowers’ ability to pay back a loan from July 2020. Your financial situation should be evaluated in order not to get into a debt trap. The CFPB changed the rule.
- Now borrowers can’t have more than a $2,500 outstanding principal across several loans.
- The State of Ohio prohibits criminal charges.
- According to the Ohio Rev. Code Ann. 1321.35 et seq., if the person is an active duty member of the United States armed forces, or if they are a dependent of an active member of the armed forces, licensed lenders may not charge or receive monthly maintenance fees from the customer.
If there is any assistance concerning payday loans or other lending issues, you can contact the Ohio Division of Financial Institutions.