29 Jan
Can I be Arrested for Default on my Payday Loan ?
Posted in Personal Loans by Pat S 7 CommentsCan I be arrested for default on payday loan ?
Well that is a question many short term borrowers may have asked themselves at some given time or another if they happen to be repeat borrowers. in some cases the lender may have instilled that fear into the borrower’s mind to frighten them into making sure that they make their payments.
However the practice of misinforming the consumer is illegal since there is no legislation in the US that states that defaulting on payday loan payments is a criminal offense. So if you have an outstanding payday loan , don’t worry about it. You cannot be arrested and put in jail for not paying your payday loan. If a lender states that you can be arrested for defaulting on your loan, then they are the ones committing a criminal offense according to the (FDCPA) Fair Debt Practices Act .
Can I be Arrested for Default on My Payday Loan ?
If you find yourself dealing with an unscrupulous payday loans company that insists that you can be arrested for default on payday loan, you can have them reported to the authorities. This may even result in voiding the agreement between you and the lender resulting in annulling your debt to them altogether.
However, as much as it may be to the relief of those who have outstanding debts, there are still some serious consequences in regards to credits scores with the credit agencies. Anyone with long outstanding debts will eventually develop a negative credit history report.
This can hurt in many ways. Repeat offenders of loan defaulting can end up having their bank accounts closed, being refused for additional credit, or nowadays even having their credit cards limits reduced. In worse cases, those with bad credit are even having their credit card privileges revoked altogether.
Short term cash loans and payday loans are not something to abuse. In many ways these are very helpful to those looking to rebuild their credit. Payday loans are relatively easy to get as long as you have a bank account, can prove income and provide personal identification.
Most lenders do not do a full credit check, so this is a great way to re establish bad credit if this happens to be the case.
Remember that in these very tough economic times, credit card companies have been hard hit with personal bankruptcies on the rise all over north America putting many credit cards companies in trouble. It is now much more difficult to establish credit, as there are many credit companies revising their lending policies leaning towards much tougher stipulations for the borrower to receive any credit. It is even getting difficult for those who have good credit to apply for additional credit.
So it is vitally important to maintain good borrowing practices and repay those payday loans even if you are not going to go to jail for not paying.
sherie myers
on September 1 2009
its a loan company kept leave voice mail on my phone stating that if i dont pay loan i can be arrected and go to jail and they are sorry for children can they do that.
wilson
on September 12 2009
I was just wondering what is the worst that can happen too you hif you dont repay your loans. and are they able too put you in jail for that.
anna melkowskli
on October 9 2009
i have pay days loans that have over welveme me i had to have moving expenses. i have consolodated them , as i can not pay off or afford to roll over. i expect a lot of unhappy lenders.
Pam
on February 16 2010
I have been called by a state processor saying they are going to serve me court documents at my job to take me to court, can they do that and can i be arressted for not being able to pay back the loan?
kari
on April 15 2010
I didn’t ever actually receive a loan and I got a call from a “supposed” creditor, oocr, saying I had to pay at least $500.00 or an officer would be at my door. What the heck’s going on?
Fredia Brinkly
on October 19 2010
When all is said and done my company still not convinced over this. The best thing about all of it would be the options that you don’t get on other companies in the same market.
Ted Kunkel
on February 23 2012
No they cannot arrest you, they use scare tatics, and if they keep callin and threating you call the police on them, cause they are commmiting a crime, but its a business, You CANNOT be arrested, unless you committed idenity theft.