S. 112.02 attempt to set limits and lump fees into cabinet authority to set limits – limits S. 112.04 makes sure fees & penalties are prohibited S. 112.05(1): borrower has right to cancel loan by end of next cancellation rights: business day by paying out principal and filling in a form. S.112.05(3): says if borrower consequences for non-advisement of cancellation rights: not advised of cancellation rights then can cancel at any time s. 112. 06 required terms and disclosure: S. 112.06(2)(k) and translate that into APR lender must disclose cost of loan (annual Percentage rate); (2)(p) must inform borrower this is a cost loan” “high (2)(q) Cancellation rights must be in loan agreement. S. 112.08: list of prohibited practices: (1)(a) no rollovers (1)(b) only 1 loan at a time (1)(j) no assignment in (1)k) no security (1)(m) catch all S. 112.10 bars PDL from charging more than allowed by statute Remedies: – borrower entitled to immediate refund. Store front Lenders must have clearly visible: in specific colors as well as text size; 2 signs need to be visible – maximum borrowing charges; Lenders must state what they charge as well as APR; must also include payday lender’s license number. Near the top of index must list same items as store front; must be Internet lenders: listed over the phone as well Payday Loan Regulations s. 17: max allowable rate is (23%) of principal;max default allowable is 30% per year Note: if you annualize the original interest rate it would be over 60% but this is capped at 30% if borrower defaults S. 18 payday loan for more than 50% of borrowers pay is prohibited. lenders barred from accessing borrowers bank S. 21(3) Bank account’s off limits account (other than preauthorized debit); also can’t give out prizes for entering into loan. S.23 (2) On lender has to spread repayment over 3 pay 3rd loan in 62 days periods. Money Mart is the largest payday loan lender in Canada. Regulation of Debt Collection: Lawyers Professional Conduct –
S. 112.02 cabinet authority to set limits – attempt to set limits and lump fees into limits S. 112.04 makes sure fees & penalties are prohibited S. 112.05(1): cancellation rights: borrower has right to cancel loan by end of next business day by paying out principal and filling in a form. S.112.05(3): consequences for non-advisement of cancellation rights: says if borrower not advised of cancellation rights then can cancel at any time s. 112. 06 required terms and disclosure: S. 112.06(2)(k) lender must disclose cost of loan and translate that into APR (annual Percentage rate); (2)(p) must inform borrower this is a “high cost loan” (2)(q) Cancellation rights must be in loan agreement. S. 112.08: list of prohibited practices: (1)(a) no rollovers (1)(b) only 1 loan at a time (1)(j) no assignment in (1)k) no security (1)(m) catch all S. 112.10 Remedies: bars PDL from charging more than allowed by statute – borrower entitled to immediate refund. Store front Lenders must have clearly visible: 2 signs need to be visible – in specific colors as well as text size; maximum borrowing charges; Lenders must state what they charge as well as APR; must also include payday lender’s license number. Internet lenders: Near the top of index must list same items as store front; must be listed over the phone as well Payday Loan Regulations s. 17: max allowable rate is (23%) of principal;max default allowable is 30% per year Note: if you annualize the original interest rate it would be over 60% but this is capped at 30% if borrower defaults S. 18 payday loan for more than 50% of borrowers pay is prohibited. S. 21(3) Bank account’s off limits lenders barred from accessing borrowers bank account (other than preauthorized debit); also can’t give out prizes for entering into loan. S.23 (2) On 3rd loan in 62 days lender has to spread repayment over 3 pay periods. Money Mart is the largest payday loan lender in Canada. Regulation of Debt Collection: Lawyers – Professional Conduct
Steele%20-%20312%20Debtor%20Creditor%20-%202009%20Final.docx