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New Statutes For Tennessee Payday Loans Make Them Better For Short Term Loans

Tennessee State Map
Tennessee State Map
For the Tennessee payday loans industry the state has passed statutes authorizing payday lending for the citizens of Tennessee. It was the legislators and 10 in passing these laws to make acquiring a payday loan in the state of Tennessee as simple and easy a process as possible, while doing what they can to protect the citizens of Tennessee. According to the Laws in payday loan can have a term of at least 31 days, this is typical of many other states have adopted a loan legislation. The maximum amount of a payday loan in the state of Tennessee cannot exceed $500, and that these and finance charges are to be 15% of the face amount of the check. The effective APR for a 14-day $100 loan is 459%.

Senate bill 1557, sponsored by Bill Ketron for the stipulates No person shall engage in the business of payday loans in this A person shall be considered to be participating in the business of payday loans in this state if the person induces a consumer, while located in this state, to enter into a payday loan transaction in this state. A separate license shall be required for each location from which the business of payday loans is conducted. The bill also stipulates that any nonresident person, seeking a license under this chapter, shall furnish the commissioner with the name and address of a resident of this state upon whom notices or orders issued by the commissioner, or process affecting a licensee under this chapter, may be served. Such nonresident licensee shall promptly notify the commissioner in writing of every change in its designated agent for service of process, and such change shall not become effective until approved by the commissioner.

Tennessee State Flag
Tennessee State Flag
It is the legislature’s desire that all entities that participate in Tennessee payday loans activities should be properly licensed by this state for the purpose of maintaining they’re in safe environment for people in the state who wish to acquire a payday loan. It is no secret that the industry has received considerable negative publicity through the years for the unethical practices of a few individuals that participate in payday loan activities. With the adoption of this legislation it would not only protect the citizens of the State of Tennessee while they’re conducting payday loan activities, it will also create a more reputable environment or ethical companies to operate in. These measures can only enhance the business as a whole in terms of its image in the community at large, as well as giving people a greater peace of mind that may wish to partake of the services.

The senate bill also provides that if a check is returned to the lender of the payday loan from a payer financial institution due to insufficient funds, closed account, or a stop-payment order, the licensee shall have the right to all civil means available and allowed by law to collect the check, including the right to collect court costs incurred in bringing the civil action as authorized in 47-29-101(a)(4), (b). So the bill appears to do a balanced job of protecting both the consumer and the payday loan company; what is not covered in the media on behalf of the Tennessee payday loans industry are the struggles that the industry has with customers that default on their payday loans. This makes for a challenging situation for businesses in the industry because for every loan that is defaulted on it creates a financial challenge for the payday loan business. Even though the moneys that may eventually be recouped, for the funds that are not recouped, in order for the business to remain in business it needs to recapture these losses somehow, and as in any other business those losses must ultimately be passed on to the responsible clients who do payday loans in a timely manner.

The bill goes on to say that no licensee shall have the authority to assess a handling charge against the maker or drawer authorized by 47-29-102 or the right to collect attorney's fees relating to the check. The ability to arbitrarily collect attorneys’ fees from customers that have defaulted on their loans might very well create extraordinarily severe financial hardship for the borrower above and beyond what the legislature deemed reasonable. In addition to this the legislature has set forth to that no individual who issues a personal check to a licensee under this chapter shall be convicted under 39-14-121. It is their opinion that the average person the default on a payday loan in the Tennessee Payday loans industry is not actively attempting to commit any kind of felony by taking out the loan then defaulting on it; for this reason it included the statute that an individual the default on a loan shall not be convicted.

Tennessee payday loans
Tennessee payday loans
Even though the legislature of the state of Tennessee has set forth comprehensive guidelines for how to Tennessee payday loans are to be managed, ultimately it is the consumer that must step forward and take responsibility for the type of experience they’re going to have when they take on a payday loan. An individual can go a long way in managing what will happen by taking the time to conduct their own personal research on how payday loans work in their individual state. This information could be instrumental in helping an individual to get the best possible deal and the best possible rate and terms when acquiring a loan. Properly utilized payday loans can be an invaluable financial instrument for people that may occasionally experience cash flow difficulties and have a need for the occasional cash infusion to help them through a financial challenging situation.

Tennessee payday loans are intended to be in the best interests of those that would have in need acquire one, however for the best possible experience in this industry one must make certain to fully assess entities that you are thinking about acquiring the loan from as well as your own personal financial circumstances to enjoy the best possible experience in getting a payday loan.