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Strict caps on payday loans in New Hampshire

In accordance with the legislation of New Hampshire payday lending business is legal in the State. On the other hand, there are rather strict limits of interest rates imposed on payday loans. These measures are adopted with the aim of preventing lenders from making fortunes and gaining enormous profits at the borrowers’ expense.

Under the State law a payday customer is allowed to resort to only one payday loan at a time in New Hampshire. It is illegal to borrow extra loans from a different lender in case you haven’t paid off your old debt yet. By violating this rule both payday lenders and borrowers will be penalized.

The law of New Hampshire also states that there is a cooling-off period. It means that after repaying the previous loan, a borrower isn’t allowed to apply for a new payday loan until 60 days have passed.

A customer can’t take a loan which sum exceeds $500. All payday lenders of New Hampshire should correspond to this rule.

The annual percentage rate for a payday loan is established at the level of 36% in New Hampshire. No lending firm is allowed to charge a borrower with a higher rate. These limits also concern financial charges, which shouldn’t make up more than $1.38 for a fortnight $100 payday loan. Approval, processing and similar fees can be included into the group of financial charges as well.

In accordance with the New Hampshire legislative acts a repayment period of a payday loan ranges from 7 to 31 days. In addition, any renewals and extensions of the loan are considered to be illegal. There is a due date when all payday loans should be paid off. A customer has a legal right to borrow one more loan from the previous lender only under the condition that he has returned the old credit.

Defaults on payments aren’t regarded as criminal infringements in New Hampshire. That’s why borrowers shouldn’t be scared by the threats of lenders promising to prosecute a defaulted customer in court. The only situation when a borrower can be subjected to a criminal action is when he has deliberately taken a payday loan and doesn’t intend to pay it back. If the evidence showing that the customer has purposefully closed his account and hasn’t made the repayment is found, he will face with serious problems. In contrast to criminal actions civil suits are absolutely legal in the State. So a borrower who has failed to repay a loan on the due date will be penalized either way.

There are no provisions concerning collection fees in the legislation of New Hampshire. Therefore payday lending companies can charge their customers with any fees they like.