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RSSThey Learned Hard Way; Payday Loans Are Illegal In NC
February 11th, 2012
It is difficult to enforce the law against companies that operate over the internet
It is illegal to operate a payday loan businesses in North Carolina. But companies still take on customers. Now, a Triangle couple has been hurt financially. When things got financially tough for Donna Seese and her husband, they surfed the internet and found “advancemetoday.com”.
Basics
“We were looking for basic necessities,” said Donna. “You know gas money, food money.” Donna said she told the advancemetoday rep she only needed $300. “What they charge is 30 percent per hundred dollars. So in reality, the total balance due would be $390,” said Donna. “So, what’s going to happen is, you’re going to see a $90 debit come out of your account on every paycheck until the loan is paid off. And I thought that sounded fair.”
Interest
Every two weeks, advancemetoday took $90 dollars out of Donna’s bank account. When the time came for the fourth $90 to be taken out, Donna thought she was close to paying off the loan, but she learned differently when she talked to an advancemetoday rep. “He said ‘the $90 payments have all gone to interest,’” recalled Donna. “And I said, ‘Excuse me? Can you please explain that again?’” What Donna never realized was that each $90 payment every two weeks never went to her original $300 loan. Instead she was charged interest of $90 every two weeks until she repaid the 300 in full. When Donna complained to advancemetoday, they debited the entire 390 from her account to close out her loan. In all, Donna paid over $660 for a $300 loan.
That hurts
“It’s definitely hurt us, because in the first place we were in a bad position,” said Donna. “This puts us in a much worse position. I don’t want to see more victims. I don’t want to see anyone else go through what I’ve gone through because it’s impacted us greatly.” The one bit of good news for Donna is that she did dispute the last charge of $390 with her bank, and for now that money has been put back into her account.
Illegal
The big red flag is that payday loan companies are illegal here in North Carolina.
Advancemetoday does have a disclaimer on their website that says their services are only available to those states permitted by law, and North Carolina is not one of them. A representative with the Attorney General Cooper’s office says it is difficult to enforce the law against companies that operate over the internet, especially if they’re located out of the country. They add, not only are these loans illegal but they also put consumers deeper in debt, which is what happened to Donna.
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