Payday loans in Alabama
Alabama permits payday loans from a lender holding a license under the Deferred Presentment Services Act.
- Payday lending
- Allowed
- Max cost
- $17.50 per $100 borrowed
- Top amount
- $500
At that cap, a $100 loan over 14 days can carry $17.50 in fees: $117.50 back in total, close to 456% APR.
Are payday loans legal in Alabama?
If a lender is licensed under the Alabama Deferred Presentment Services Act, payday loans in Alabama are legal. Borrowing is limited to $500 for terms between 10 and 31 calendar days. A lender may charge at most 17.5 percent of an advance, which works out to $17.50 on each $100 borrowed. You are allowed to renew a loan just one time. If two consecutive loans are paid in full, you cannot take another until the next working day arrives.
The $500 cap in Alabama applies to all your open payday loans from every lender put together. Shops must use one statewide database operated for the Alabama State Banking Department to check your total. Also, any Small Loan Act loan collected or made without a license is void. So the lender may not collect principal, interest, or charges. See if the lender is licensed by checking the Bureau of Loans license search before you pay or borrow.
- Lenders must check each loan against a single real-time statewide database run for the State Banking Department.
- All open payday loans with any lender count toward the $500 limit, not just those from one shop.
- The fee is calculated as a percentage, specifically 17.5% of the amount advanced, instead of a flat dollar charge per $100.
- Only one renewal is permitted; after two loans in a row are repaid in full, the lender must wait for the next working day.
- In the case Austin v. Alabama Check Cashers Ass'n (2005), the Alabama Supreme Court ruled that prior payday agreements fell under the Small Loan Act.
Alabama payday loan laws
- Law in force
- Alabama Deferred Presentment Services Act
- Cited as
- Ala. Code 5-18A-1 through 5-18A-22
- Fees under the law
- 17.5 percent of the amount advanced is the highest fee allowed
- Most you can borrow
- $500
- How long a loan runs
- 10 days to a span of 31 calendar days
- Rollovers
- one renewal allowed (this means no more than one additional time, or two continuous transactions at most)
- Cooling-off gap
- once two continuous transactions are repaid in full, a new loan is not allowed until the following working day
- Loans you can hold at once
- from any lender, outstanding deferred presentment transactions may not exceed $500
- Installment lending limits
- For loans under $1,500, the Small Loan Act sets 3% monthly on principal owed up to $200, and 2% monthly on the rest above $200.
Also checked against law.justia.com. Full statute text.
Online lenders that list Alabama
Ten companies we track say they lend in Alabama: 3 online installment lenders, 6 tribal lenders and 1 loan broker.
| Lender | Kind | Posted APR |
|---|---|---|
 NetCredit | Installment | 34.99% to 99.99% |
 OppLoans | Installment | 99% to 195% |
 Rise Credit | Installment | 60% to 299% |
 Viva Payday Loans | Broker | Partner lenders quote 4.99% to 1,386% |
Tribal loans in Alabama
The Small Loan Act in Alabama voids loans made or collected in violation of its licensing section, so principal, interest, and charges cannot be collected by the lender.
On the immunity claim tribal lenders make, see are tribal loans legal.
Six tribal lenders we track list Alabama as a state they lend in. Three of the six publish an APR, from 73.7% to 725%.
| Lender | Posted APR |
|---|---|
 Mobiloans | 73.7% to 405% |
 Spotloan | 99% to 490% |
 BrightLending | 325% to 725% |
 MaxLend | Not published |
 Minto Money | Not published |
| American Web Loan | Not published |
Need cash in Alabama? Ask about cheaper routes
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Alabama and the states around it
| State | Payday lending | Max cost | Top amount |
|---|---|---|---|
| Alabama | Allowed | $17.50 per $100 borrowed | $500 |
| Florida | Allowed | $10.00 per $100 borrowed | Both figures exclude fees: $500 is the face amount for single-payment loans, and $1,000 is for deferred presentment installment transactions. |
| Georgia | Banned | None in the law | None allowed |
| Mississippi | Allowed | $20.00 per $100 borrowed | Per customer at any time, the most you can get is $500 including fees. |
| Tennessee | Allowed | $15.00 per $100 borrowed | The total face value for outstanding checks is $500. |
Alabama loans with no credit check
Installment loan rates: For loans under $1,500, the Small Loan Act sets 3% monthly on principal owed up to $200, and 2% monthly on the rest above $200.
See no credit check loans: the checks lenders still run, and the price.
Verify a lender's license in Alabama
- Look the lender up on the license list before you hand over any bank details.
- Lenders here answer to the Alabama State Banking Department, Bureau of Loans.
- Had trouble with a lender? Report the lender.
Sources for Alabama
- Since 1 January 2004, payday lenders must hold a licence issued by the Bureau of Loans supervisor.; The fee is capped at 17.5% of each advance.; The maximum amount a lender may advance is $500.banking.alabama.gov
- One common real-time database used by every licensee must be run by the Banking Department.admincode.legislature.state.al.us
- The Justia mirror of 5-18A-12 provides a second check on the fee cap and $500 limit.law.justia.com
- For loans under $1,500, the Small Loan Act sets a monthly rate of 3% on the first $200 and 2% on the remainder.; On loans under $1,500, the Small Loan Act sets the rate at 2% a month for the amount above $200.; If a small loan is made or collected in violation of the Small Loan Act licensing section, it is void.banking.alabama.gov
- Deferred presentment licences appear in the Bureau of Loans licensee search tool.apps.banking.alabama.gov
- In 2005, the Alabama Supreme Court overturned a decision saying payday deals fell outside the Small Loan Act.law.justia.com
- The Attorney General accepts consumer complaints via a hotline and a form.alabamaag.gov