The Protections of Payday Loans

An industry you can trust

The Utah Consumer Lending Association makes every effort to help its customers be successful borrowers.

RESPONSIBLE BORROWERS

Payday loan customers use the service responsibly:

pro-95say that before starting the payday loan process, they understood both how much it would cost and how long it would take to completely repay the loan.

pro-94were able to repay their loan in the amount of time they had expected.

93 percentreport that before taking out a payday loan, they carefully weighed the risks and benefits of doing so.

BEST PRACTICES

Members of the UCLA follow these best practices:

Before loan is issued

  • Require checking account

  • Require steady source of income

  • Verify consumer’s ability to repay

  • Verbally disclose terms and conditions

  • Present extended payment plan option in bolded font in paperwork

After loan is issued

  • Rescind a loan at no cost within 24 hours

  • Allow loan repayment over two months with no additional fees or interest

  • Stop the interest on one payday loan annually

  • Only pay interest for actual duration of loan if repaid before due date

 INDUSTRY PROTECTION

With UCLA support, the Legislature has championed laws that increase protections for payday loan customers:

1999

Banned unlicensed lenders from operating in the state, created notices to file complaints, established 12-week limit on loans

2010

Provided customers an interest-free loan at least every 12 months, limited loan to 10 weeks

2003

Gave customers the right to make partial payments or rescind loan

2007

Added further written and oral disclosure requirements

2012

Voided any loans originated by an unregistered lender

2014

Inquire about a customer’s ability to repay the loan, mandatory interest-free pay down after 70 days

2005

Limited amount of interest a lender can charge on a judgment

2008

Limited the number of loans a customer can have at once

A BALANCED & REGULATED MARKETPLACE

Utah has struck the best possible balance between consumer safeguards for short-term loans and providing valued access to credit when people need it most.

REAL PEOPLE, REAL STORIES