Cash Advance and Payday Loans in Massachusetts

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Massachusetts is one of the most restrictive states regarding its cash advance and payday lending laws. These strict regulations have limited the number of lenders that are operating within the state. However, there are still options for consumers looking to find alternative financing.

The Small Loan Act, 209 Mass. Code Regs. 45:14(8) highlights the rules and regulations regarding lender licensing.

Massachusetts Small-Dollar Loan Rules and Regulations

View of historical monument in front of buildings in downtown Boston, Massachusetts.

Massachusetts instituted strict regulations and caps on payday loan APR and fees. As a result, this has significantly diminished the number of lenders offering alternative financing. However, if you are still searching for emergency funding, you may have options.

What Are My Options for Basic Expenses and Emergency Funding in Massachusetts?

If you find yourself in need of money for any number of reasons, the following options may be available to you in Massachusetts:

  • Consumer lenders– Look for lenders who are appropriately licensed to offer long-term loans. Please note that additional fees may also be added to the cost of the loan.

  • Credit unions– Members can often receive favorable loan terms. Some banks also offer short-term loans on favorable terms.

  • Credit cards– For financial emergencies, a credit card is useful. There are even credit cards available for people with lower credit scores. However, before requesting a credit card, be sure to read about the interest rates and fees.

  • Government assistance– Eligible residents who are having trouble paying bills may benefit from state-funded welfare programs, such as the Low Income Home Energy Assistance Program.

After you find emergency funding, the next step should be planning for the future. Credit counseling may be a good first step, as it can help consumers learn how to balance their budget and avoid short-term loans altogether.

Installment Loans in Massachusetts

The strict restrictions on small-dollar, short-term loans also apply to installment loans in Massachusetts. As a result, many consumers find it difficult to obtain longer-term financing through installment loans. Nevertheless, many residents may find financing through the aforementioned avenues.

Car Title Loan Laws in Massachusetts

Massachusetts is one of the 34 states across the country that has restrictions on auto title lending. According to the Mass. Gen. Laws Ann. ch. 140 § 96 et seq.; 209 and the Mass. Code Regs. § 26.01 statutes, car lenders are prohibited from operating within the state, and car title lending is prohibited under the existing credit laws.

Like payday loans, auto title loans are prohibited in Massachusetts due to the high APR charged. Such high fees can often force borrowers to take out additional loans to cover previous debts and potentially trap consumers in unsustainable financial cycles.

Final Thoughts

Undoubtedly, the strict lending laws enforced by Massachusetts make it difficult for consumers to find financing options. However, there are other options available, including government assistance programs and credit unions. If you are a Massachusetts resident in need of funding, consider these options instead.


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