Payday Loans Quiz

10. A payday lender can charge the borrower $25 plus the amount of bank charges when a check is returned NSF or not sufficient funds.

b. INCORRECT

True. Payday lenders can charge up to $25 per check if the check bounces. In addition, they can charge fees imposed by the lender's bank, plus attorney and administrative fees, but all fees combined cannot exceed 75 percent of the principal of the original loan. Giving a NSF check to a payday lender is not illegal unless the borrower stops payment or closes the account.

References:
Missouri General Assembly. (n.d.). Missouri Revised Statutes, 408.505. http://www.moga.mo.gov/statutes/C400-499/4080000505.HTM

Missouri General Assembly. (n.d.). Missouri Revised Statutes, 408.233.
http://www.moga.mo.gov/statutes/C400-499/4080000233.HTM