Compare your loan options in Georgia

Although payday loans might seem like a good idea, if you’re a resident of Georgia, you have other options that will help you out in a financial emergency.

Are payday loans legal in Georgia?

No, payday loans aren’t legal in Georgia. Small dollar loans are heavily regulated and governed by statutes 16-17-1 et seq., 7-3-14 et seq. and 80 3-1.02(7). High-cost payday lending is a felony in Georgia, and all lenders attempting to distribute these loans can be pursued by criminal action cases.

Any short-term lender wishing to operate in Georgia must abide by the the rules outlined in 7-3-14 et seq. These state that all small loans must be under $3,000 for a period of 36 months and 15 days. Interest is capped at 10% per year. Loan fees are 8% for the first $600, then 4% for everything above $600. These laws apply to installment loans as well, so be sure to check the terms of any installment loan you apply for.

If your lender doesn’t abide by these regulations, don’t agree to the loan contract. Instead, contact the Georgia state attorney general and file a report.

What are the typical costs of a loan in Georgia?

Several factors impact the interest you have to pay on loans, such as your credit, the amount you borrow, the lender and the loan term.

You may have to pay additional fees in different circumstances. If you don’t make a payment on time you may have to pay a late charge. If a check does not go through because of insufficient funds in your account, your lender may charge a non-sufficient funds (NSF) fee. Some lenders can also charge application fees and loan disbursement fees, and they might even charge you if you choose to repay your loan amount early.

In Georgia, your late fee is processed five days after the payment is due and is the larger of either $10 or an amount equal to $0.05 (five cents) for every $1 of the installment. Lenders may also charge a maintence fee of $3 for every month in the loan contract’s term, whether the payment is one lump sum or divided into other installments.

It’s important to reiterate this is for all loans, and if a lender doesn’t abide by these, you should avoid borrowing money from it.

What other options are available?

While getting a payday loan in Georgia is not possible, you can get credit or cash in other ways. Some of your options include:

• Speak with your creditors. If you’re considering a payday loan because of a large bill, talk to your creditors and request smaller monthly payments. Being upfront about your inability to pay will show that you’re serious about paying down your debt but need more time, and you’ll be able to avoid late fees and potential default.
• A credit card cash advance. If you already have a credit card, consider a cash advance. You can withdraw money up to your credit limit, usually for less interest than other types of short-term loan, and you have a little longer to pay it back. This is a quick fix for financial troubles, but it can help you get through tough times.
• Ask family and friends for help. If you can’t afford your debt, consider asking someone you know to give you help during a tough financial situation. They’re unlikely to charge interest, but remember that it’s still a small loan. You should always pay back the people who help you as soon as you can.
• Government assistance programs. Georgia has quite a few public assistance programs that you may want to apply for. These include HomeSafe Georgia, the Energy Assistance Program (LIHEAP), Medicaid, Temporary Assistance for Needy Families (TANF) and the Heating Energy Assistance Team (HEAT). The variety of help can be great when you need a little bit extra to get by but don’t want to take out a new line of credit.

Read quick info on the alternatives to payday loans

Bottom line

While you don’t have access to a payday loan in Georgia, you can still find other options to help with financial emergencies. If you find yourself in long-term debt problems, consider credit counseling to help in the process of creating a budget and getting out of debt.

Have more questions?

• Why are payday loans illegal in Georgia?

  Payday loans are considered predatory because they target people with low incomes and bad credit. Because of this and the high interest rates, payday loans have been illegal in Georgia for over a century under usury laws. In 2004, these laws were strengthened to remove the loopholes some lenders were using to illegally distribute loans.

• I’ve come across an online lender who is willing to give me an payday loan in Georgia. Is this legal?

  No, it is not. Out-of-state lenders cannot legally provide payday loans to residents of Georgia. This includes online tribal lenders.

• I've accidentally gotten an illegal payday loan. What should I do?

  You should contact your local district attorney to pursue criminal action against the company. In addition, Georgia recommends you report the incident to the Office of the Commissioner of Insurance (Industrial Loan Division) as well as the Georogia attorney general by mail.