Ifinternet payday loans are illegalin your state, can you stop automatic payment withdrawals?
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Ifinternet payday loans are illegalin your state, can you stop automatic payment withdrawals?
I have several internet payday loans for which I am being charged enormous finance and management fees. After talking with the CO Attorney General’s office, all of my internet loans are illegal in the state. I’m filing a complaint with the AG’soffice, but in the mean time, I would like to stop the ACH’s from my account. Since these loans are not legal, will there be any repercussions of stopping the payment on these loans?
Asked on March 29, 2011 under General Practice, Colorado
Answers:
MD, Member, California Bar / FreeAdvice Contributing Attorney
Answered 13 years ago | Contributor
Unfortunately, internet payday loan companies are rampant and you need to figure out if they are indeed illegal. Since in your particular situation you found out they are and did file a complaint, you need to also ensure your loans are not simply (as a result of the complaint or otherwise) sent off to a collections agency. If they are, you need to figure out whether or not you intend to admit you owe these loans. If you do, you will wind up extending the statute of limitations (the time the companies have to collect). Bottom line is, you were lent the money so to stop payments altogether is your decision alone. Every state's laws are different but if you plan on stopping payment, verify the bank will not reopen your account or allow the account to get charged fees.
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