Colorado

In Colorado “loan splitting” is illegal. Loan splitting is the practice of diving one loan into two separate loans. Often times lenders split loans to charge more fees. Under Colorado Law, multiple agreements are prohibited.

Colorado does not restrict the number of loans a lender can lend as long as it doesn’t exceed a certain amount. Under Colorado law the maximum amount allowed by payday loan companies to one borrower is $500.
This Colorado restriction on amounts is per lender rather than licensed location. Which means a payday loan company cannot lend a borrower more than $500 even if they go to two separate locations. Colorado law states it’s the lenders responsibility that all other locations comply with the law.

In addition to loan amounts, Colorado law also regulates financing charges. Under the current Colorado law, a payday lender cannot collect more than 20% on the first $300 that’s borrowed, and no more than 7.5% on amounts loan over $300. Colorado law sets any loans of $500 at a maximum finance charge of $75.

Colorado law states that if a consumer borrows $500 in a single loan, the maximum finance charge can only be $75. As stated above, the loan cannot be split.