Payday Loans in Ohio
- Nickname: The Buckeye State
- Population: 11.69 million
- Capital: Columbus
- Website: https://ohio.gov/
Ohio is known for many things: rock and roll, football, and many heroes of aviation and space travel. But among all the fun and innovation, more than 15% of Ohio residents are living at or below the federal poverty line. To make matters worse, Ohioans who graduated from college are each sitting with an average of $30,239 in student loan debt.
Payday Loans in Ohio
A payday loan is a type of short-term loan. While most lenders won’t lend to borrowers whose credit is less than stellar, payday lenders don’t check credit. Instead, they ask borrowers to use their next payday as collateral, and have them fill out a post-dated check in the amount of the loan, plus interest. If the borrower fails to pay back their loan before the date on the check (which is typically their next payday), the payday lender will cash the check.
About 1 in 10 Ohio residents (or 1 million people) have taken out a payday loan in the past year from the more than 650 payday loan storefronts in the state (two-thirds of which are run by companies from other states). Ohio payday loan borrowers include rural and urban families, as well as single parents and veterans. According to Pew Charitable Trusts, the typical payday borrower in Ohio earns about $30,000 per year and uses payday loans to cover recurring expenses, such as rent, mortgage payments, groceries, and utilities. Pew data also shows that Ohio residents are borrowing an average of $300 per loan, which costs them an average of $68 per 2-week pay period, or $680 over only 5 months (which is more than double the original loan amount).
According to the Ohioans for Payday Loan Reform, 70% of payday loan borrowers in Ohio say that they use the loans for basic household expenses, and the typical borrower signs up for a 2-week loan, but stays in debt for about 6 months.
Source: Center for Responsible Lending
Consumer Protection in Ohio
How to Report a Lender in Ohio
Payday lenders in Ohio can either collect on loans without legal assistance, or they can sell the debt. However, under section 1321.45 of the Payday Loan Laws, collections agencies acting on behalf of payday lenders must properly identify themselves to the borrower, their family, their employer, or their friends. Phone harassment and calling after 9 p.m. is against Ohio Payday Loan Laws.
If you have been harassed via phone calls, here are a few things to keep in mind the next time you receive a call:
- Ask the caller for their name, company, street address, and telephone number. Be sure to tell the caller you will not discuss any debt until you get a written “validation notice.” Don’t pay if the caller refuses.
- Put your request in writing. The Fair Debt Collection Practices Act (FDCPA) requires any debt collector to stop calling if you ask in writing. If the debt is accurate, sending such a letter won’t eliminate the debt, but it will stop the calling.
- Don’t give or confirm any personal, financial, or other sensitive information (protect yourself).
- Contact your creditor to discuss the debt.
- Report the call to the Federal Trade Commission and the Ohio Attorney General’s office. Contact Ohio Attorney General Mike DeWine (@OhioAG) to report tips and scams by visiting his website at: http://www.ohioattorneygeneral.gov/. Next, scroll to the bottom of the page and click “File a Complaint” under the “Services” directory. You will be directed to fill out an online complaint form. You can also contact the Attorney General’s Office by calling (800) 282-0515.
Additionally, online lenders or any storefront businesses that have no license cannot file any legal actions against borrowers who don’t repay their loans, because those transactions are considered null or void. If you’ve dealt with an unlicensed lender in Ohio and are being pressured to pay back your debt, it’s important to understand that you are not legally obligated to do so. Report those lenders and save others the hassle.
For assistance with predatory lending issues, you can also contact the Ohio Division of Financial Institutions, which is located at 77 South High Street, 21st Floor Columbus, OH 43215 and can be reached by calling (614) 728-8400. You can also contact the Ohio Poverty Law Center, which is a nonprofit law office advocating for policies to protect and expand the legal rights of low-income residents of Ohio. Ohio Legal Services also provides counseling on payday and title loans as well as additional information on what to look out for and how to deal with predatory lenders.