Why is there so much information in the payday loan customer agreement?

The payday loan customer agreement is a comprehensive document that fully outlines all terms, conditions and applicable laws of the payday loan transaction. This document is designed to provide the borrower with detailed descriptions of everything expected of both the payday loan provider and the borrower. This document also explains all state and federal laws that apply to the loan. Whether a payday loan transaction occurs online or in-store, it’s important that the borrower is provided with all the information required to make the best, most informed decision possible.

The payday loan customer agreement will contain the following:

State and Federal Disclosures
Depending on where the payday loan provider is located, state laws will vary. Some states have specific laws pertaining to the amount borrowed, and can range from a flat amount to a percentage. For example, through Check ‘n Go, Illinois payday loan borrowers can receive 25% of their gross monthly income or $1,000, whichever is less. Alabama customers can receive a maximum of $500. There are also laws in place that define the minimum and maximum borrowing period for a payday advance loan.

Regardless of the state of the payday loan provider, federal laws will apply everywhere and are outlined so the borrower can take them into consideration.

Rates and Terms
Every payday loan provider has its own applicable charges that will affect the transaction. These are outlined in the payday loan customer agreement, including service fees and fees that will apply should the repayment become past due. The service fee is the flat amount added to the loan amount. This fee will be expressed in a dollar amount, as well as Annual Percentage Rate (APR) in accordance with federal law.