Payday loans are short-term, high-interest cash advances to borrowers. The loaned amount plus the finance charge is due on the date the borrower received his next paycheck. Oklahoma laws refer to these as deferred deposit loans. Deferred deposit lenders legally can extend up to $500 to consumers.
As the borrower, you can have no more than two outstanding loans at a time. You and the lender can agree on a repayment plan, but rollovers aren't permitted. This means that you can't renew the loan. Loan requests initiated 13 days after a previous one originated are considered renewals, and hence aren't permitted. You also can't use the proceeds of a previous payday loan to repay a current payday loan. If you take out four consecutive loans, you have the right to pay off the fourth loan in installment payments.
Lenders must review a statewide database that tracks outstanding payday loans before extending a loan to you.
Lenders can't ask you for security or a guarantee from a third party when they give you a loan. This means they can't ask you for collateral to secure the loan. They also can't extend the loan period for longer than 45 days or shorter than 12 days. Lenders must post their annual percentage rates, charges and loan terms at their place of business, and they must give you written information describing the availability of credit counseling and debt management services. Lenders also must give you the toll free number to the Administrator of Credit Counseling services, in case you want to get information about debt management and credit counseling.
Lenders that violate the rules of the Deferred Deposit Lending Act might have to pay $1,000 for each violation, as well as return any excessive or unlawful fees.
Lenders can charge up to $15 per $100 of the first $300 that you borrow. So, if you take out a $300 loan, the lender can administer a $45 finance charge for the loan. They can charge an additional $10 for each increment of $100 over $300. This means a $400 loan might cost you $55 in finance charges. Lenders must display the finance charge and the annual percentage rate in the payday loan terms prominently.
Payday loans must be in writing, and you and the lender must sign the loan documents. The lender must advise you that the deferred deposit loan is not intended to meet long-term financial needs but should be used to meet short-term cash needs only. As a borrower, you have the right to revoke deferred deposit loans. You must return the full proceeds of the loan, and you must rescind by 5 p.m. of the next business day following the loan transaction.
If your request is late, the lender has the right to refuse it.
Past Due Accounts
Oklahoma lenders must abide by the Fair Debt Collection Practices Act, which stipulates that they must collect past-due accounts in a fair and lawful manner. They can't threaten or pursue criminal charges against you if you don't make agreed payments on your payday loans. As a result, you're not subjected to criminal penalties if you default on your payday loans. The lender, however, can take you to civil court and can add a $25 collection charge to the amount that you owe.