Payday Loan in Oklahoma
Legal Status: Legal
Citation:
Okla. Stat. Tit. 59 § 3101 et seq.
Loan Terms:
Maximum Loan Amount: $500
Loan Term: 12-45 days
Maximum Finance Rate and Fees: $15 per $100: $0- $300; $10 per $100: $301-$500
Finance Charge for 14-day $100 loan: $15
APR for 14-day $100 loan: 390%
Debt Limits:
Maximum Number of Outstanding Loans at One Time: Two
Rollovers Permitted: None (cannot renew; a loan made within 13 days after a previous one was entered into shall be considered a renewal and shall not be made)
Cooling-off Period: Second business day after the 5th consecutive loan repaid
Repayment Plan: Yes
Collection Limits:
Collection Fees: $25 NSF fee (if disclosed) unless dishonored due to theft or forgery
Criminal Action: Prohibited
Where to Complain, Get Information:
Regulator: Oklahoma Department of Consumer Credit
Address: 4545 North Lincoln Boulevard, Suite 104 Oklahoma City OK 73105
Phone: (405) 521-3653
Fax: (405) 521-6740
Applicability: The provisions of this act shall apply to all deferred deposit loans made. The provisions of this act shall apply to transactions if the lender, wherever located, enters into the transaction with the debtor by mail, brochure, telephone, print, radio, television, Internet, or any other means. Otherwise Consumer Credit Code applies. Okla. Stat. tit. 14A, § 3-508A (30% interest per year on unpaid balances of $300 or less; 21% per year on unpaid principal of $300-$1000; and 15% per year on unpaid principal of more than $1,000).
Exemptions: This act shall not apply to a supervised lender licensed under the Uniform Consumer Credit Code. The following lenders shall not be subject to the licensing requirements of this act: A bank, savings institution, credit union or farm credit system organized under and regulated by the laws of the United States or any state; government or governmental agencies or instrumentalities; or pawnbrokers engaged in pawn transactions as defined in the Oklahoma Pawnshop Act.
Licensing requirements: Deferred deposit lenders must obtain a license. The licensee shall post its license to engage in the business of making deferred deposit loans at each licensed location. An applicant must have a minimum net worth of at least $25k available for operation of each licensed location up to a maximum net worth of $250,000.
Required disclosures: A written agreement executed by both the lender and the debtor that expressly authorizes the lender to defer presentment or deposit of the instrument until a specific date not later than forty-five (45) days from the date the instrument is accepted by the lender. The disclosure of the credit terms of a deferred deposit loan shall be according to and governed by the requirements of Regulation Z. A lender shall provide the following notices in a prominent place on each deferred deposit loan agreement in at least twelve-point type: “A deferred deposit loan is not intended to meet long-term financial needs. This loan should be used only to meet short-term cash needs. You have the right to rescind this deferred deposit loan no later than 5 p.m. of the next business day following this loan transaction. If you enter into a deferred deposit loan and three consecutive deferred deposit loans, you have the right to pay off the fourth loan pursuant to an installment payment plan, subject to certain conditions.” A lender shall post at the licensed location a notice of the charges, terms, and effective annual percentage rate for deferred deposit loans made by the lender. Prior to sale or assignment of instruments held by the lender as a result of a deferred deposit loan, the lender shall place a notice on the instrument in at least twelve point type to read: “This is a deferred deposit loan instrument regulated by the Oklahoma Department of Consumer Credit and any holder of this check takes it subject to all claims and defenses of the originator” and shall include the address and toll-free telephone number of the Department of Consumer Credit. At the time a debtor enters into a deferred deposit loan transaction, the lender shall provide the debtor with a pamphlet, approved by the Administrator of Consumer Credit, describing the availability of debt management and credit counseling services, the debtor’s right to an installment payment plan and the debtor’s rights and responsibilities in the transaction. The pamphlet shall indicate a toll-free telephone number for the Administrator that the debtor may contact to receive information relating to debt management and credit counseling services.
Prohibited acts: A deferred deposit lender shall not charge fees other than, or in excess of those authorized by the Deferred Deposit Lending Act; make deferred deposit loans at unlicensed locations; alter or delete the date on an instrument after it has been accepted by the lender pursuant to a deferred deposit loan; accept an undated instrument or an instrument dated on a date other than the date of the deferred deposit loan; accept an instrument unless the account on which the instrument is drawn is a legitimate, open and active account; require a debtor to provide security for the deferred deposit loan or require a debtor to provide a guaranty from another person; advance a loan amount greater than $500 to a borrower in one deferred deposit loan transaction; engage in a deferred deposit loan with a term of less than 12 days or more than 45 days; negotiate or present an instrument for payment unless the instrument is endorsed with the actual business name of the lender; negotiate any instrument presented by a borrower if the borrower has redeemed the instrument by paying the full amount due under the deferred deposit loan; make any charge for insurance in connection with a deferred deposit loan transaction; refuse the borrower’s right to rescind the deferred deposit loan at any time between the time of the deferred deposit loan transaction and 5 p.m. of the next business day; charge the borrower an additional finance charge for cashing a lender’s business instrument, if the lender pays the proceeds from the loan transaction in the form of a business instrument; require or accept more than one dated instrument per deferred deposit loan; or refuse the borrower’s right to enter into an installment payment plan. A lender shall not threaten or pursue criminal action against a debtor as a result of the debtor’s instrument being returned unpaid or the debtor’s deferred deposit loan account not being paid. A debtor shall not be subject to any criminal penalty if an instrument is dishonored. A lender may not enter into a renewal of a deferred deposit loan transaction. A new loan made within 13 days of a previous one shall be considered a renewal. After the debtor has entered into a fifth consecutive deferred deposit loan, a lender shall not make a deferred deposit loan to a debtor until 8:00 a.m. on the second business day after the fifth consecutive deferred deposit load has been paid in full. No lender shall engage in false or misleading advertising concerning the terms or conditions of credit with respect to a deferred deposit loan.
Permitted charges: A lender may charge a finance charge for each loan that does not exceed $15 for every $100 advanced up to the first $300 of the amount advanced; for the advance amounts in excess of $300, the lender may charge an additional finance charge of $10 for every $100 advanced in excess of $300. If an instrument held by a lender as a result of a deferred deposit loan is returned to the lender from a pay or financial institution due to insufficient funds, a closed account or a stop payment order, the lender shall have the right to exercise all civil means authorized by law to collect the amount of the instrument. In addition, the lender may contract for and collect a dishonored instrument charge, not to exceed $25; however, a dishonored instrument charge shall not be allowed if the instrument is dishonored by a financial institution, or the debtor places a stop payment order, due to forgery or theft of the instrument.
Payment plan: If a debtor enters into a third consecutive loan, the lender shall provide the consumer an option to repay such loan and each consecutive loan pursuant to a written repayment plan subject to the following terms: the debtor shall request the repayment plan, either orally or in writing, prior to the due date of the loan; the debtor shall repay the loan in four equal installments with one installment due on each of the next four dates on which the customer receives regular wages or compensation from an employer, pursuant to a written repayment plan agreement; the consumer shall pay a processing fee of 10% of the principal amount of the loan per loan not to exceed $15 for administration of the payment plan; the consumer shall agree not to enter into any additional deferred presentment loans during the repayment plan term and for a period of 15 days after termination of the repayment plan term; and upon positive completion of the repayment plan, the lender shall report the debtor’s positive payment history to at least one national consumer credit reporting agency.
Enforcement: The Administrator of Consumer Credit may suspend, revoke or refuse to renew licenses, issue orders compelling compliance, give censure, probation, or issue injunctions or cease and desist orders for violations.
Penalties: Civil penalties for violations of this act in an amount not to exceed $1,000 per violation; Repayment of unlawful or excessive fees charged to debtors.
