In recent years, the loan lending industry had a tremendous growth. Why has the loan lending industry grown so much? Nowadays, having a job and working hard simply does not guarantee you a stable financial state. Even people who make the best with what they have, calculating their monthly earnings and expenses and structuring their budgets in the best possible way, they could often struggle with their bills. And while for most people, things are hard on a regular monthly basis, the situation gets even worse when an unexpected event occurs and they do not have the cash to deal with that emergency. This is why so many people seek financial assistance in the loan lending industry, and this is why the industry is growing so fast.
Today, there are many different loans that borrowers can choose from. Some are easier to get, and some are not so easy to get. Some loan types have better terms than others and so in that sea of options, it is pretty difficult for most people to find the loan that suits them the most.
However, there is one loan type that attracts the attention of many borrowers due to its flexible terms and accessibility and that loan type is payday loans. Even though payday loans are probably the most popular loan type out there, they are not completely legal in all states. In this article, we will look specifically at payday loan law regulations in the state of Maine and will explain whether payday loans there are available for borrowers who live there.
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What is a payday loan?
Payday loans are a certain type of short-term, small-sum loans (known also as cash advances) where the person borrowing the money must repay the amount in full within his next payday. Payday loans are usually granted with a maximum amount of $500 for a time period of no more than two weeks. It is important to know that every state in the United States has its own payday loan law regulations and so each payday loan may have different terms. Sometimes the amount can go as high as $1,000 for a period of 31 days.
Payday loans have extremely high interest rates and fees which make them quite dangerous if they are not repaid on time. However, they do offer lots of features that attract the interest of most borrowers. Still, you should not go for a payday loan unless your financial situation really calls for it. If you fail to repay your payday loan on time, you can get yourself in lots of financial troubles. So it is best that you use payday loans as a last resort option.
Are payday loans legal in Maine?
Payday loan lending in Maine is considered legal and payday loan lending companies can conduct their businesses as long as they adhere to Me. Rev. Stat. Ann. tit 9-A §1-201 and Me. Rev. Stat. Ann. tit. 9-A §1-301 law. Even though payday loans are considered legal in the state of Maine, payday loan lenders in the state must operate under certain restrictions. According to Maine’s payday loan laws, only supervised loan lenders are allowed to grant payday loans to borrowers. Therefore, getting a payday loan in Maine is not that easy after all.
In order to operate in the state of Maine, such payday loan lending companies need to comply with some very strict loan regulations that are also quite unfavorable in terms of profit. In Maine, there is a small loan rate cap, prohibiting payday loan lenders from charging more than 30% interest on a loan that is for an amount less than $2,000.
Maine payday loan laws forbid loan lending companies from charging more than $5 for any loan up to $75. They are not allowed to charge more than $15 for loans with an amount between $75 and $250, and they are also forbidden to charge more than $250 for any loan exceeding $250. Such interest rates are quite low when talking about payday loans and they surely protect the borrowers from falling into debt cycles.
When we talk about online payday loan lenders, things are a bit more complicated. Online payday loan lending companies are harder to monitor when they deal with the checking account of a person and do not involve post-dated checks. This is the reason why in the state of Maine, there are online payday loan lending companies which operate illegally. Therefore, in case you are thinking about taking out a payday loan in Maine, you should be really careful when dealing with online payday loan lenders. Getting a loan with high interest and fees can lead you to a worse financial state.
What are the eligibility requirements for a payday loan in Maine
In order to be eligible for a payday loan in Maine, you must meet certain eligibility requirements such as:
- You need to be a permanent resident of the state or to have an American citizenship
- You need to be 18 years old or above
- You need to have a steady source of monthly income
You will also need to provide the following info:
- Your birth name, home address and phone number
- Your social security number
- Details of your income and employment
- A valid form of identification
Cities in Maine where you can find payday loan lenders
Payday loans could be the answer for your financial needs. However, you must be careful when taking out a payday loan. Do research on different payday loan companies before you choose one to work with. Also make sure that you are absolutely capable of repaying the loan on time because the last thing you want is a default on your payday loan.