New Jersey Payday Loans

Consumer loan act applies but rates as agreed to by contract. N.J. Stat. Ann. tit. 17:1 et seq. However, criminal law sets the usury cap at 30%. N.J. Stat. Ann. 2C: 21-19. A check cashing licensee cannot cash or advance money on a postdated check. N.J. Stat. Ann. 17:15A-47.
Status: Prohibited

Payday loans are prohibited in the state of New Jersey, pursuant to N.J. Stat. Ann. tit. 17:1 et seq.

Payday Loan Lending Laws in New Jersey

New Jersey law prohibits payday lending, specifically in regard to the state’s check-cashing law. The state prohibits a person from cashing a paycheck without a banking account, which limits a person to dealing with bank where they have an account. As payday lending companies require a personal check to do business, they cannot operate in the state.

The state also has strict usury laws, which forbids lenders from charging borrowers an interest rate exceeding 30 percent per annum. Any organization operating in the state that claims to offer payday services is doing so illegally as of February 2017.

What is a payday loan?

Payday loans are defined as short-term financial loans that get paid back within a two-week period, usually coinciding with the borrower’s next paycheck on a biweekly pay cycle. Payday loan amounts generally do not go higher than $500 in states where they are legal, but the amounts vary from state to state. Payday loans serve as attractive options to potential borrowers due to the easy application process and the lack of requirements regarding the loan purpose. The application process usually only takes a few minutes and a borrower is either approved or denied a few minutes later. A potential borrower only needs to be an 18-year-old U.S. citizen with a bank account to apply, although application does not guarantee approval.

Additionally, payday loans do not require any type of collateral from the borrower. And as stated before, the loan can be used for anything the borrower needs it for, from getting a car fixed to handling an unexpected medical bill. Depending on the state in question, a borrower might be able to take out multiple loans with different lenders. With any financial loan, however, the borrower should take care to understand the loan terms and have a plan to pay the funds back before agreeing to the lender’s terms.

Loan Options

While cash advance loan centers cannot operate physically in the state of New Jersey, residents in need of a loan do have other options. One notable way is to search for loans online. There are websites that allow borrowers to search for loan companies that operate outside of New Jersey and apply based on the stated terms and conditions. This process works on a similar business plan used by credit card companies, which tend to operate out of a bank in one state but provide credit services throughout the country. If a traditional loan with a bank or creditor does not appear to be a realistic solution, a state resident can apply for a loan over the internet. However, the borrower will need to accept responsibility for the loan and its repayment.

Small Loan Rate Cap:
30% per year
*The information displayed may not be current. For the most recent information, please visit http://www.paydayloaninfo.org/state-information/38.

Regulatory Information

If you have a complaint against a New Jersey Cash Advance location you can contact your state regulator below:

Regulator:
New Jersey Department of Banking and Insurance
Address:
20 West State St. Trenton NJ 08625
Phone:
(609) 292-5360
Fax:
(609) 292-5461
Website:


New Jersey Check Cashers

Below you can find New Jersey check cashers in the following cities:

New Jersey Statistics**

The following information is key demographic data for the state of New Jersey from the Census bureau.

Total Population:
8,944,469
Median Household Income:
$72,093
Poverty Rate:
10.8%
Median Gross Rent:
$1,192
High School Graduate or Higher:
88.6%
Bachelor's Degree or Higher:
36.8%
**The information displayed may not be current. For the most recent information, please visit http://www.census.gov/quickfacts.

Borrow Responsibly

The best way to use any short-term loan should be to address short-term financial emergencies that can be paid back in a short amount of time. However, the very nature of emergency situations can make it difficult for a potential borrower to do the proper research and ask the right questions about a cash advance loan before agreeing to the terms. In that regard, New Jersey’s current laws can be both a blessing and a curse: in-state prohibitions force a potential borrower to put in the work of finding the right lender, but financial pressure can make such work stressful and does not guarantee a borrower will make the best choice. Short-term loans should never be used for long-term financial planning or anything other than an emergency situation; doing otherwise can put the borrower in a financial situation that can prove very difficult to escape. Above all else, the borrower must take ultimate responsibility to use the loan funds as needed and repay them quickly. Failing to do so can lead to long-term consequences, including credit damage and debt cycles.

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