Colorado Payday Loan Laws: A Comprehensive Guide

Colorado has a relatively strict set of payday loan laws to protect its citizens from predatory lending practices.

Payday lenders are prohibited from charging interest rates exceeding 36% APR, a significant reduction from the national average.

Colorado's laws also limit the maximum loan amount to $500, and lenders are not allowed to issue more than one loan at a time to the same borrower.

Borrowers are required to repay their loans in full within 35 days, with no rollovers or extensions allowed.

Colorado's payday loan laws also mandate that lenders disclose the total cost of the loan, including all fees and interest, to the borrower before they sign the agreement.

Additional reading: Payday Loans Not Lenders

The Colorado Office of the Attorney General is responsible for enforcing payday loan laws within the state. They oversee the Consumer Credit Unit, which manages licensure and registration programs for companies and individuals involved in consumer lending.

This includes payday lenders, which are supervised by the Consumer Credit Unit. They enforce the terms and conditions in the Colorado Uniform Consumer Credit Code, which sets forth the current restrictions on payday loan interest rates, fees, and repayment terms.

The Consumer Credit Unit investigates complaints against these lenders and takes disciplinary or legal action against those who fail to abide by the law, which may include fining or disbanding them.

Curious to learn more? Check out: Consumer Financial Protection Bureau Credit Cards

Populus Financial Group, Inc. is the most complained about lender in Colorado, with a whopping 18 complaints since 2013.

The primary complaint reason against Populus Financial Group is being charged fees or interest that consumers didn't expect.

Their subsidiary Ace Cash Express is a national payday and short-term installment loan provider, although it doesn't currently offer payday loans in Colorado explicitly.

However, Ace Cash Express does have a rates webpage for installment loans in the state, which includes some pretty steep terms.

Here's a summary of their price points at various standard loan balances:

These terms seem to fly in the face of the Colorado Uniform Consumer Credit Code, and we would recommend taking your business somewhere with an APR below 36% whenever possible.

Wells Fargo, a well-respected bank, was also a problematic lender in Colorado, with 11 complaints since 2013.

They offered a $500 deferred deposit advance loan with an APR of 120%, which is suspiciously similar to a payday loan.

Check this out: Lower Apr Credit Card

Supervised lenders are a key part of the payday lending landscape in Colorado. They are non-depositories, meaning customers can't make deposits with them.

Some examples of supervised lenders in Colorado include SpeedyCash, EZPawn, Check City, Ace Cash, Moneytree, and Checkmate. These lenders are subject to regulations and oversight by the Colorado Office of the Attorney General.

The Colorado Office of the Attorney General's Consumer Credit Unit manages licensure and registration programs for supervised lenders, ensuring they comply with state laws. If a supervised lender fails to follow the law, they can face disciplinary action, including fines or being shut down.

Supervised lenders in Colorado are required to follow strict rules, including limiting the maximum loan amount to $500 and the minimum term to 6 months. They can also only charge a maximum of 20 percent in financing fees for the first $300, with an additional $7.50 charge for each additional $100 loaned.

For another approach, see: Lenders Payday Loans

Colorado's regulations and limits on payday loans are designed to protect consumers from predatory lending practices. In Colorado, payday lenders may not loan a borrower more than $500 in aggregate.

The maximum interest rate on payday loans in Colorado is 36% APR, which is a significant reduction from the previous 45% APR. Origination fees can be no more than 20% of the first $300 of the loan and 7.5% of amounts above that.

Collection fees are limited to one $25 NSF fee, and lenders cannot take criminal action against borrowers unless the consumer's account was closed before the agreed-upon negotiation date. The laws also limit monthly maintenance charges to $7.50 per $100 loaned, not to exceed $30 total.

Here is a summary of the key regulations and limits:

These regulations and limits aim to prevent borrowers from getting trapped in a cycle of debt, and they have had a significant impact on reducing the number of payday loans in Colorado.

Regulation Documents are crucial for compliance. They outline the specific rules and guidelines that businesses and individuals must follow.

The Clean Water Act, for example, requires companies to obtain permits before discharging pollutants into waterways. This ensures that our water sources remain safe and healthy.

The EPA has established a list of regulated substances under the Toxic Substances Control Act. These substances must be handled and disposed of properly to prevent harm to humans and the environment.

Companies must also adhere to the guidelines set forth in the Occupational Safety and Health Act. This includes providing a safe working environment and proper training for employees.

The OSHA regulations cover a wide range of topics, including workplace hazards, emergency procedures, and record-keeping. This helps to prevent workplace injuries and illnesses.

The EPA's Resource Conservation and Recovery Act sets forth guidelines for waste management and disposal. This includes requirements for recycling, storage, and disposal of hazardous waste.

Curious to learn more? Check out: A Finance Charge Includes Which Elements

In Colorado, the laws are designed to protect borrowers from predatory lending practices. The maximum loan amount is $500, and lenders can't charge more than 36% APR. This means that if you already have a payday loan for $400, a second lender can't give you more than another $100 in payday loans.

The Colorado payday loan laws also limit the number of rollovers allowed. You can only roll over a loan once, and after that, you'll need to pay off the loan in full. This helps prevent borrowers from getting stuck in a cycle of debt.

Here's a summary of the debt and collection limits in Colorado:

If you're unable to pay off a payday loan, the lender can't take any legal action against you unless your account was closed before the agreed-upon negotiation date. This means that borrowers who maintain their checking accounts but are unable to repay their payday loans are protected by the state laws from payday loan lenders.

The statute of limitations is a crucial concept to understand when dealing with debt. In Colorado, the statute of limitations for most debts is six years.

This means that after six years, the court can't order you to repay your old debt. It's essential to keep track of time to avoid being sued over old debts.

Auto loans are the exception in Colorado, with a statute of limitations of four years. This is a significant difference to be aware of when dealing with auto loan debt.

Expand your knowledge: Cash Out Auto Refinance Bad Credit

In Colorado, supervised lenders are non-depositories that don't allow customers to make deposits. Supervised lenders in the state include SpeedyCash, EZPawn, Check City, Ace Cash, Moneytree, and Checkmate.

Supervised lenders are subject to state law, which governs the allowable APR on loans they make. Colorado has a tiered rate system where allowable APR decreases as loan size increases.

This tiered rate system was constructed to keep lending costs reasonable, particularly for those who take out high dollar loans.

For another approach, see: How Is the Interest Rate on a Payday Loan Calculated