If you have ever been tempted to get a Payday Loan, Jo Ann Deal of the Better Business Bureau has a warning for you.
The Federal Trade Commission announced that Red Cedar Services Inc. and SFS Inc. will pay $2.2 million each and will waive or wipe out $68 million in inflated fees charge to consumers nationwide.
This case is an historical case.
Combined with earlier settlements, the FTC has recovered about $25.5 million this far and the total estimated waived debt is $353 million making this case the largest FTC recovery in a payday lending case.
Consumer complaints led to the discovery that a contract being used stated that a $300 loan would cost $390 to repay when actually $975 was charged.
The Payday loan operators failed to accurately disclose the annual percentage rate (APR) and other terms which is a violation of the TILA laws as known as Truth In Lending Act.
Very simply, the payday loan companies made it a precondition to get the loan to preauthorize debits from consumer accounts.
This is a violation of the Electronic Funds Transfer Act (EFTA).
For those who might be affected, watch the FTC website for the payback schedule by visiting: www.ftc.gov
And, warn everyone you know about how easy it is to get duped on payday loans.
For more information and help specific to the Northeast Louisiana area, visit: www.bbb.org/north-east-louisiana