Legal Status: Legal

Citation:
Mo. Rev. Stat. § 408.500 et seq.; 4 Mo. Code Regs. § 140-11.010, 140-11.020

Loan Terms:
Maximum Loan Amount: $500
Loan Term: 14-31 days
Maximum Finance Rate and Fees: Not Specified (No borrower shall be required to pay a total amount of accumulated interest and fees in excess of 75% of the initial loan amount on any single authorized loan for the entire loan term and all authorized renewals. Otherwise, interest is set pursuant to small loan law which provides that parties may set rate by contract.)
Finance Charge for 14-day $100 loan: $75
APR for 14-day $100 loan: 1980%

Debt Limits:
Maximum Number of Outstanding Loans at One Time: Not Specified
Rollovers Permitted: Six (borrower must reduce principal amount of loan by 5% or more upon each renewal)
Cooling-off Period:
Repayment Plan:

Collection Limits:
Collection Fees: NSF fee; Collection costs (including court costs and reasonable attorney’s fees) Licensee cannot use a series of ACH transactions to collect a single check.
Criminal Action: Prohibited (Unless check returned due to closed account or stop-payment by maker)

Where to Complain, Get Information:
Regulator: Missouri Division of Finance
Address: Consumer Credit Section, P. O. Box 716 301 W. High Street Jefferson City MO 65102
Phone: (573) 751-3242
Fax: (573) 751-9192

Applicability: Lenders, other than banks, trust companies, credit unions, savings banks and savings and loan companies, in the business of making unsecured loans of five hundred dollars or less. Otherwise, consumer loan act applies. Mo. Rev. Stat. § 408.100 (rate set by agreement among parties).

Licensing requirements: Must obtain a license from the director of the division of finance. An annual license fee of three hundred dollars per location. A licensee who ceases business pursuant to this section must notify the director to request an examination of all records within ten business days prior to cessation. All records must be retained at least two years.

Required disclosures: TILA disclosures required on any loan, renewal or extension made pursuant to this section and the loan, renewal or extension documents shall be signed by the borrower. Lenders licensed pursuant to this section shall conspicuously post in the lobby of the office, in at least fourteen-point bold type, the maximum annual percentage rates such licensee is currently charging and the statement: NOTICE: This lender offers short-term loans. Please read and understand the terms of the loan agreement before signing. The lender shall provide the borrower with a notice in substantially the following form set forth in at least ten-point bold type, and receipt thereof shall be acknowledged by signature of the borrower:(1) This lender offers short-term loans. Please read and understand the terms of the loan agreement before signing.(2) You may cancel this loan without costs by returning the full principal balance to the lender by the close of the lender’s next full business day.

Loan terms: 14-31 days. The lender shall renew the loan upon the borrower’s written request and the payment of any interest and fees due at the time of such renewal; however, upon the first renewal of the loan agreement, and each subsequent renewal thereafter, the borrower shall reduce the principal amount of the loan by not less than 5% of the original loan amount until such loan is paid in full. However, no loan may be renewed more than six times. When making or negotiating loans, a licensee shall consider the financial ability of the borrower to reasonably repay the loan in the time and manner specified in the loan contract. A lender shall not have more than $500 in loans outstanding to the same borrower at any one time. A person does not commit the crime of passing a bad check if, at the time the payee accepted it, he or she does so with the understanding that the payee will not present it for payment until later and the payee knows or has reason to believe that there are insufficient funds on deposit with the drawee at the time of acceptable. This section shall not apply if the person’s account on which the instrument was written was closed by the consumer before the agreed-upon presentment date or the consumer has stopped payment on the check.

Permitted fees: Entities making loans pursuant to this section shall contract for and receive simple interest and fees in accordance with provisions of the small loan act. Cost of collection expenses, which include court costs and reasonable attorneys’ fees, awarded by the court in suit to recover on a bad check or breach of contract shall not be considered as a fee or charge for purposes of this section. No borrower shall be required to pay a total amount of accumulated interest and fees in excess of 75% of the initial loan amount on any single authorized loan for the entire loan term and all authorized renewals.

Prohibited acts: A lender shall not use a device or agreement that would have the effect of charging or collecting more fees, charges or interest than allowed by this section.

Penalties: Any contract evidencing any fee or charge of any kind whatsoever, except for bona fide clerical errors, in violation of this section shall be void. Any person, firm or corporation who receives or imposes a fee or charge in violation of this section shall be guilty of a class A misdemeanor.

Enforcement: Director may suspend or revoke license; issue cease and desist orders. License suspension or revocation license; issue cease and desist orders enforceable by a civil penalty of not more than one thousand dollars per day for each day that the neglect, failure or refusal shall continue. The penalty shall be assessed and collected by the director. In determining the amount of the penalty, the director shall take into account the appropriateness of the penalty with respect to the gravity of the violation, the history of previous violations, and such other matters as justice may require.