By Shawn Martin
Minnesota loan laws for payday loans are about as confusing as they come.
This state is set up for major payday loan traps, and borrowers must beware of how fast a person can get in trouble in this state.
At first glance they seem like any other state, with a loan limit of $350.00 and duration of the loan is limited to 30 days. The interest is a whole different picture.
This is a quote from the website Credit.com :
” (i) On any amount up to and including $50, a charge of $5.50 may be added; (ii) on amounts in excess of $50, but not more than $100, a charge may be added equal to ten percent of the loan proceeds plus a $5 administrative fee; (iii) on amounts in excess of $100, but not more than $250, a charge may be added equal to seven percent of the loan proceeds with a minimum of $10 plus a $5 administrative fee; (iv) for amounts in excess of $250 and not greater than $350, a charge may be added equal to six percent of the loan proceeds with a minimum of $17.50 plus a $5 administrative fee. After maturity, the contract rate must not exceed 2.75 percent per month of the remaining loan proceeds after the maturity date calculated at a rate of 1/30 of the monthly rate in the contract for each calendar day the balance is outstanding. (Minnesota Small Loans – Chapter 47.60)”
This is as big a trap as I have ever seen, and it is no wonder people in this state are in big trouble with payday loan debt!
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I hope this articles on Minnesota loan laws helps you make a good decision on using these companies.