Payday Loans in South Carolina: Subprime Report
- Nickname: The Palmetto State
- Population: 5.08 million
- Capital: Columbia
- Website: www.sc.gov
There’s a lot of history in South Carolina—the first battle of the Civil War took place at Fort Sumter. However, the deep history of South Carolina doesn’t necessarily translate into good living conditions for the state’s residents. Approximately 15.4% of those living in South Carolina had 2018 earnings below the poverty threshold—which was, unfortunately, higher than the national average of 11.8% for that year.
Pile on top of that is South Carolina’s total student loan debt of $24.4 billion, which equates to about $36,456 per borrower (as of June, 2019). In addition, 28% of the state’s residents have at least some medical debt in collections (at an average of $733 per borrower). As a result of these financial challenges, many South Carolina residents might be looking for alternative means for making ends meet, such as payday loans and title loans. However, it is important to read the information below before getting trapped in an endless cycle of debt with South Carolina payday and title loans.
Payday Loans in South Carolina
Payday loans in South Carolina are allowed under state law. Some people in the state who are struggling might turn to payday loans for “help”. According to the Center for Responsible Lending, most payday loans are taken out to help people with their recurring, everyday expenses. They are usually lent out to people who have poor or no credit and have had trouble finding other resources to help them make ends meet.
But many who have gone down this route have ended up worse off than when they started. Payday loans are short-term loans that come with very high annual percentage rates (APRs) and fees, and are expected to be paid back within short periods of time (usually about 2-4 weeks). With these terms, many borrowers are, unfortunately, not able to repay their loans on time and often must resort to taking out additional loans (called rollovers) to pay for their initial loans. With this, the destructive cycle begins, and many people find it hard to get out of this desperate situation.
Title Loans in South Carolina
Another type of predatory lending practice – title loans – is legal in South Carolina. Title loans are considered short-term loans, with typical terms of no more than 30 days. Title loans require borrowers to provide lenders the titles to their vehicles, which can be used for repossession if the borrowers are unable to pay back their loans on time. Like payday loans, title loans come with high APRs and fees, and borrowers of these loans frequently find themselves in the tough position of not being able to pay back the loan amounts within the allotted time period. As a result, they often need to borrow additional loans to cover themselves. As with payday loans, they often end up in a never ending cycle of debt…
In a 2015 report, The Pew Charitable Trusts indicated that the average APR for these types loans are typically 300% (across the U.S.) and that about half of title loan borrowers use the funds to pay for ongoing, regular expenses.
Consumer Protection in South Carolina
So, you’ve taken out a payday loan or title loan in South Carolina… now what? If you are experiencing harassing phone calls, emails or other disruptions, you don’t have to just put up with the threats. Reach out to the South Carolina State Board of Financial Institutions to file a complaint (see contact information below). You can file a complaint, and a representative will work to help resolve your issue.
The South Carolina State Board of Financial Institutions
- Address: 3rd Floor, Edgar Brown Building 1205 Pendleton St. Columbia, SC 29201
- Phone Number: (803) 734-2020
- Website: http://www.bofi.sc.gov/