payday loans continue to be big business in Wisconsin and throughout the U.S., in spite of some payday loan laws which help the consumer by limiting the fees payday loans can charge in some states. While borrowing money with a high interest short term loan has been around for decades (think of the neighborhood loan shark and the collarteral requiring pawnshop) the payday loan in its current form is expanding fast, as online fast cash advance companies are becoming quite numerous, and are lending money in several different states.
In the state of Wisconsin alone, according to some figures, the Department of Financial Institutions (DFI) accounted 839,285 Wisconsin payday loans totaling $200.2 million back in 1999, (and that was before people were using online loan companies) with a surprising increase from 1996, which recorded approximately 80,000 Wisconsin payday loans at $11.2 million. It was even noted by the DFI data that there had been an increase in the number of licensed Wisconsin payday loan lenders. The number then almost doubled from 17 Wisconsin payday loan companies with 64 locations in 1996 to 31 Wisconsin payday loan companies at 174 locations in 1999. Around 2000-2002 online payday loan companies began to gain dominance, vastly increasing the number of payday loans which are applied for at home, public internet sources and work.
With such notable growth in the Wisconsin payday loan business alone, several questions have been raised regarding the regulations of Wisconsin payday loan practices. Many Wisconsin payday loan lenders have asserted that they are providing a needed service that is not accessible through the conventional financial institutions. On the other hand, many of the Wisconsin payday loan consumer groups question the finance charges assessed for the Wisconsin payday loans. For that matter, the Wisconsin Legislature considered two major approaches to further standardize the Wisconsin payday loan lending within the state, however, these approaches were neither passed.
Furthermore, it has been noted in some reports that the senate proposal actually dealt with placing maximum interest rates for the Wisconsin payday loans. For this, the assembly measure would have obligated the Wisconsin payday loan lender to give further detailed and comprehensive information to the consumers of the payday loans about the loans in general.
Today, the state of Wisconsin along with the other states such as Arkansas, Montana, Hawaii, and Utah, sets payday loan fees at a maximum percentage of the face value of the total check, while the others impose the percentage fee on the proceeds of the payday loan. In addition, a few states set a sliding fee scale associated to the size of the loan.
The Wisconsin payday loan lenders these days, according to the new regulation, should generally obtain a license from DFIs Division of Banking for the main purpose of charging interest higher than 18 percent APR, however, there is no statutory maximum on the interest rates or fees charged by these Wisconsin payday loan lenders.
Furthermore, it has been noted in some reports that the senate proposal actually dealt with placing maximum interest rates for the Wisconsin payday loans. For this, the assembly measure would have obligated the Wisconsin payday loan lender to give further detailed and comprehensive information to the consumers of the payday loans about the loans in general.
Today, the state of Wisconsin along with the other states such as Arkansas, Montana, Hawaii, and Utah, sets payday loan fees at a maximum percentage of the face value of the total check, while the others impose the percentage fee on the proceeds of the payday loan. In addition, a few states set a sliding fee scale associated to the size of the loan.
The Wisconsin payday loan lenders these days, according to the new regulation, should generally obtain a license from DFIs Division of Banking for the main purpose of charging interest higher than 18 percent APR, however, there is no statutory maximum on the interest rates or fees charged by these Wisconsin payday loan lenders.
