West Virginia Payday Loans

Small loan act applies. W. Va. Code § 46A-4-107 and §§ 32A-3-1 et seq.
Status: Prohibited

Payday loans are prohibited in the state of West Virginia, pursuant to W. Va. Code § 46A-4-101 et seq.

Payday Loan Lending Laws in West Virginia

State law currently prohibits payday lenders from doing business inside the state of West Virginia. No additional legislation seeking to introduce the practice into the state has been put forth by state legislative workers in several years, and any internet searches for payday loans operating in West Virginia will produce results. Due to these prohibitions, a potential borrower should be aware that any company in the state that claims to offer payday lending services is most likely not operating legally.

There have been some attempts to circumvent the current state laws. In 2012, the State Attorney General won a settlement with online payday loan lender Payday Financial LLC. West Virginia law does allow lenders with Native American tribal affiliations to lend and market payday loans due to tribal legal immunity, and Payday Financial tried to claim it was tribal-owned and thus free to engage in payday practices. The company eventually lost the case after a judge ruled the company was not tribal and therefore excluded from tribal immunity.

What is a payday loan?

Payday loans are short-term loan types that have become popular in the last decade due to the easy application process and the small list of requirements to apply. The loans get their name from the relatively short time span between loan approval and the payback period, usually two weeks, that tend to coincide with the biweekly pay period commonly used by employers in the U.S. The loans generally allow a borrower to apply for a relatively small amount of money, which can be anywhere from $100 to $1,000 depending on the state, and do not carry any spending restrictions. That is, a borrower does not have to declare what the loan is for, freeing them to use it as they see fit.

To apply for cash advance loans in states where they are legal, a potential borrower only needs to be over the age of 18, be a U.S. citizen, and have access to a bank account. Payday loans do not require any collateral from the borrower to apply, and the borrower’s credit history and debt level do not come into play during the application process. These factors add to the attractiveness of payday loans; if a borrower needs to address an unexpected financial emergency like home repair and does not have the credit or cash immediately available, they have the option of seeking a payday loan and paying it back within two weeks.

The easy application process and complete freedom of borrower usage, however, can lead to large problems if the borrower does not respect the terms of the loan. The biggest danger of payday loans is the trap of a debt cycle, wherein a borrower does not pay the loan back on time and gets hit with extra fees and charges and may feel inclined to take out additional loans to payback the original amount.

Other Loan Options

Although West Virginia does not allow payday loans at present, there are other options available to its residents. Traditional bank and creditor loans are still allowed, not to mention personal loans from friends and family.

Online loan searches have also grown in popularity due to the lack of short-term lenders operating in the state. Potential borrowers can search the internet for loan companies that offer loans. West Virginia law currently does not prohibit this practice, which operates under a business structure similar to credit card companies. This means a bank operating in Texas might be open to lending funds to a West Virginia resident, but applying for such a loan does not guarantee loan approval. Regardless of approval status, a potential borrower should understand the loan terms before agreeing to accept the funds.

Lending Rules*

Lenders in the state of West Virginia are legally required to comply by the following limitations according to Small loan act applies. W. Va. Code § 46A-4-107 and §§ 32A-3-1 et seq.:

Small Loan Rate Cap:
31% per year on a loan of $2,000 or less
*The information displayed may not be current. For the most recent information, please visit http://www.paydayloaninfo.org/state-information/56.

Regulatory Information

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

Office of West Virginia Attorney General (see also Consumer Protection Division)
Consumer Protection Division, P.O. Box 1789, Charleston, WV 25326
(304) 558-8986
(304) 558-0184

West Virginia Check Cashers

Below you can find West Virginia check cashers in the following cities:

West Virginia Statistics**

The following information is key demographic data for the state of West Virginia from the Census bureau.

Total Population:
Median Household Income:
Poverty Rate:
Median Gross Rent:
High School Graduate or Higher:
Bachelor's Degree or Higher:
**The information displayed may not be current. For the most recent information, please visit http://www.census.gov/quickfacts.

Borrow Responsibly

The easy application process should not embolden a borrower into thinking such loans are easy solutions to financial difficulties. Short-term loans should never be used for long-term financial planning or anything other than an emergency situation. They should also never be abused. By design, a short-term loan works best to address unexpected financial emergencies, but the borrower needs to remember that the loan will have to be paid back.

Due to the state prohibitions on payday lending, the potential borrower should take advantage of the ability to review and choose a loan that works best for them. This may seem like an unlikely indulgence to someone feeling desperate, but they should remember the full responsibility of the loan terms will be theirs if they agree to accept the loan.

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