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Is it illegal for Check n' Go over 200% interest on a $2500.00

Claremont, CA |

My boyfriend decided to get a Check n' Go personal loan in the amount of $2500 about six months ago. I just recently found out that the interest rate is over 200%. He has been paying $285. every other week and still owes over $2800.00! When I heard about it I though "This has to be illegal" so I did some "Googling" and found that there was a class action suit against the company sometime last year but there were very specific details as to how they are still allowed to charge such a high interest rate. We are in CA and the company is in OH. I would like to find a way to help him get out of this loan that he will probably never pay off!!

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Filed under: Class action
Attorney answers 2

Posted

Horrible stuff really. Not sure it's illegal, as CA cares more about businesses than people. Try finding an atty for consult here:

http://www.naca.net

http://www.CaLemons.com

Scott Richard Kaufman

Scott Richard Kaufman

Posted

To the original poster, I know someone in Sacramento who is a consumer advocate on the highest level and would very much like to speak to the "victim" of this super high interest loan. Please get in touch with my office directly first. http://www.CaLemons.com

Posted

CA is one of the most consumer-friendly states in the Union. The general rule is that interest in excess of 10% per annum is usurious and may not be collected in court. There are many exceptions such as for banks, pawn-brokers and paycheck loans, but I think the max is around 36%. If they want to collect, they will have to sue in CA, so the CA limit should apply. All they can recover is the principal, no interest. You should consult a consumer attorney about it.

DISCLAIMER—This answer is for informational purposes only under the AVVO system, its terms and conditions. It is not intended as specific legal advice regarding your question. The answer could be different if all the facts were known. This answer does not establish an attorney client relationship. I am admitted only in California. (Bryant) Keith Martin sbbizlaw.com

Scott Richard Kaufman

Scott Richard Kaufman

Posted

I wish you were correct. I'm not sure this type of business is so regulated. I've seen 100%+ loans regularly and felt powerless to help. 200%+ sets a new LOW. Maybe someone at http://WWW.NACA.net can help, maybe...

Bryant Keith Martin

Bryant Keith Martin

Posted

Every loan in CA, business or personal, is regulated unless it is from a bank or is a qualified real estate loan.

Scott Richard Kaufman

Scott Richard Kaufman

Posted

My sources are telling me that "There are no hard caps for loans above $2500 in CA." Since most car title loans are above this number, it's entirely possible that currently, there is some loophole for these folks to crawl into/under and continue to make usurious interest on consumers. I will continue to dig.

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