Kansas Payday Loans

If you are a resident of Kansas and need some quick cash, you may consider taking out a payday loan. A payday loan is a short-term loan that is usually repaid in a single payment on your next payday. However, before you apply for a payday loan, you should be aware of the laws and regulations that govern this type of lending in Kansas.

According to the Kansas Statutes § 16a-2-404 and -405, payday lenders that operate in Kansas are required to license with the Office of the State Bank Commissioner (OSBC). They can charge an amount not to exceed 15% of the amount of the cash advance, and the minimum term of any loan under this section shall be 7 days and the maximum term shall be 30 days. A lender and related interest shall not have more than two loans outstanding to the same borrower at any one time and shall not make more than three loans to any one borrower within a 30 calendar day period. The contract rate of any loan made under this section shall not be more than 3% per month of the loan proceeds after the maturity date. No insurance charges or any other charges of any nature whatsoever shall be permitted, except for one return check charge if the check is deemed insufficient.

Payday loans can be very expensive and risky for borrowers. According to a report by the Kansas Action for Children (KAC), the average annual percentage rate (APR) for a payday loan in Kansas was 391% in 2018. This means that if you borrow $500 for 30 days, you will have to pay back $587.50 on your next payday. If you cannot afford to repay the loan in full, you may have to roll it over or take out another loan, which will increase your debt and fees. The KAC also found that payday lenders disproportionately target low-income, minority, and rural communities in Kansas.

Therefore, before you apply for a payday loan in Kansas, you should explore other alternatives that may be cheaper and safer for your financial situation. For example, you may ask your employer for an advance on your paycheck, seek help from a local credit union or nonprofit organization, or apply for a personal loan from an online lender that offers lower rates and longer repayment terms. You should also compare different payday lenders and their fees and terms before you sign any contract. You can use online tools such as pitriloans.com or finder.com to find and compare payday loans in Kansas.