Pennsylvania
House Bill 2672 of the 2002 session established the first payday loan laws in Pennsylvania. In the bill it states that any payday loan business operating in Pennsylvania must include the information on the following topics in their loan agreement form:
- Appropriate use
- Maximum loan amounts
- Finance charges
- Limitations on Renewal of Loans
- Right to Rescission
- Limitations on multiple loans
As for restrictions on fees, Pennsylvania has laws that are similar to Oklahoma. Under Pennsylvania law a payday loan lender cannot charge more than 20% for the first $300, and 7.5% for any amount in excess of $300. However, instead of a $400 limit, lenders in the state of Pennsylvania are allowed to provide loans up to $500. Also, the total amount of fees cannot exceed $75.
As stated above, a consumer has the right to void their loan agreement and cancel their loan to avoid paying fees. They can only void a contract if they do so at the close of business or 5 p.m. the following day of the transaction.
Under Pennsylvania law, a lender cannot lend second payday loan if a borrower has an outstanding balance. Before a person can borrow a payday loan in Pennsylvania, they must verify to the lender they have no outstanding loan balances. If a person renewals a payday loan agreement, the lender has the right to charge additional fees. The fees must not exceed 30% of the first $300 or 7.5% of any excess amount up to $500.
All payday loan lenders in Pennsylvania must post a notice of charges. The notice must contain the following statement in ten-point type: This is a deferred deposit loan instrument.
Pennsylvania law prohibits a cash advance lender from seeking criminal charges on anyone that defaults on a loan because of insufficient funds.