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payzonno loans

payzonno loans

Americans from all walks of life use payday and vehicle title loans, and they do so typically to cover recurring expenses such as rent, mortgage payments, groceries, and utilities, rather than for unexpected expenses.1 Only a checking account and verifiable income are needed to get a payday loan;2 a clear title to a vehicle is usually required to get a title loan.

Lenders issue these loans to hundreds of thousands of Virginians each year. And this high-cost credit carries some of the most lax borrower protections in the country because lenders operating in the state can make loans according to any of four statutes, two of which allow unlimited interest rates.3 (See Table 1.) As a result, Virginia residents pay up to three times more for this type of credit than borrowers in other states, even those who get loans from the same companies.4

Other states, such as Colorado and Ohio, have modernized small-loan laws to make credit more affordable while keeping it widely available.5 Virginia could follow their lead to better protect borrowers from harmful loan terms.