Are Payday Loans Legal?

Payday loans are regulated on a state-by-state basis. Some states prohibit payday lending through various laws, some restrict the amount of money you can borrow and at what cost, and some states allow most types of payday loans.

In order to issue you a loan, a payday lender must be licensed in the state in which you're located (this goes for online lenders as well). The loan they give you must also follow the state's specific guidelines regarding interest rates on payday loans, fees, the ability to renew or roll over your payday loan and the manner in which they can collect payment.