In the state of Louisiana payday lending is considered legal.
Louisiana has a $350 payday loan limit. Payday loans can be taken for the period up to 30 days with the maximum finance charges of 16.75% of the amount advanced; actual APR equals 391%. No rollovers are allowed. Criminal actions are prohibited.
While most states try to restrict payday lending regulations, Louisiana seems to be going in the reverse direction. In the light of the looming CPPB payday loan rule, lenders tried to push a bill that would extend the payday loan options (higher loan amount, longer terms).
However, fortunately, the bill died in a House committee and Louisiana is to stay with the existing payday loan regulations for now.
Louisiana Payday Lending Statutes
La. Stat. Ann. 9:3578.1 et seq., or Louisiana Deferred Presentment and Small Loan Act, regulates the industry.
Other payday loan regulations:
- LL 01-04 Records Retention Schedule
- LL 02-01 Sale and Financing of Club Memberships Policy
- Records Retention Rule for Non-depository Institutions
- Title 9: Chapter 2-A. Deferred Presentment and Small Loan Act
In order to operate in the state, payday lenders are required to obtain a license with the Louisiana Office of Financial Institutions (OFI).
A full list of licensed lenders can be accessed on the Active Payday Licensees page.
Loan Amount in Louisiana
According to the Louisiana Deferred Presentment and Small Loan Act, it is forbidden to lend more than $350 in Louisiana.
Rates, Fees and Other Charges in Louisiana
Lenders willing to operate in the state should adhere to the following charges and fees allowed:
- Licensed lenders are permitted to apply a fee of no more than 16.75% of the check being provided to a borrower according to La. Stat. Ann. 9:3578.1 et seq.
- A $10 documentation charge, 16.75% maximum of the amount being borrowed, or a maximum fee of $45 may apply.
- A $100 loan issued for fourteen days is subject to finance charges of no more than $30.
APR can reach 391% for the average $300 payday loan (According to the Center for Responsible Lending 2019)
The Maximum Term for a Payday Loan in Louisiana
- The loans are given for a
periodof up to 30 days.
- Rollovers are not allowed in Louisiana.
From July 2020, lenders are not required to check a borrower’s ability to repay a loan.
Be careful, evaluate your financial situation, don’t get into a debt trap.
The rule was changed by the CFPB.
- Criminal charges are prohibited in the state of Louisiana.
In case of any assistance in regard to payday loans, one can contact the Louisiana Office of Financial Institutions (OFI).
Regulator: Complaints & Information
Louisiana Office of Financial Institutions
Mailing Address: P.O. Box 94095, Baton Rouge, LA 70804-9095
Address: 8660 United Plaza Blvd 2nd Floor, Baton Rouge, LA 70809
File a Complaint: http://www.ofi.state.la.us/complaints.htm
Number of Louisiana Consumers Complaints by Topics
According to CFPB Consumer Complaint Database
- Fraud and threat ( 151 )
- Charges from account ( 113 )
- Not exiting debt ( 107 )
- Loan to return ( 29 )
- Not requested loan ( 26 )
- Lender is not available ( 26 )
- Credit rating ( 25 )
- Loan not received ( 13 )
The Quantity of Top Louisiana Stores by Cities
The History of Payday Loans in Louisiana
- Before 1990s – Louisiana had 12% usury cap on loans.
- 1990s – La. Stat. Ann. 9:3578.1 et seq., or Louisiana Deferred Presentment and Small Loan Act, exempted payday loans from usury laws and the payday loan stores opened for business.
- 2006 – The Military Lending Act effectively capped payday loans offered to the military at 36% APR.
- 2010 – The Legislature passed a law that allowed increased fees on payday loans.
- 2014 – The Louisiana Legislature took an attempt to pass the bill that would have capped payday loan APR at 36%. The bills didn’t pass.
- June 2, 2016 – The Consumer Financial Protection Bureau (CFPB) proposed a Payday Loan Rule that hasn’t yet fully come into effect (the federal rule is expected in November 2020).
- 2018 – The Louisiana Senate tried to pass a bill to expand payday industry (the Louisiana Credit Access Loan Act that would allow payday loans from $500 to $875 for terms of 3-12 months), however, an effort failed in a House committee.
[Updated As of February 2020]