The 'Payday Loan'

If you don't pay, or you owe too much money, you have an 'automatic' payday loan. In this situation, most lenders offer you cash to pay back the loan as long as you make good on your end of the deal. Some loans contain a 'cash for services' requirement and some only require cash

Payday Loan Rules

This money can also be called a 'moneylender' because many payday loans originate from payday lenders -- companies who provide loans for paydays, usually in the mail, that can then be collected by debt collectors.

Payday lenders make much money off low-income customers; when you pay them back they can collect fees for any services you don't receive. Many payday lenders also sell the rights to your identity and information to another party. This person (called 'the borrower') uses that information to seek out other creditors seeking repayment from you. Often these 'debt collectors' are the same company that originated the loan or charged you the maximum amount requested.

How Is A Money Lender A Money Lender?

A 'money lender' or 'debt collector' is a person who receives or gathers cash from you for a reason other than payment to you. One method of collection is to collect the money from your bank account. (The 'interest is not due until the money is collected.' The bank usually has no way to check whether the person is in reality a business and not a consumer.)

Another method of collection is by sending you a letter and your bank check. (In this method, the letter contains legal demands that the creditor may not abide by without legal action.)

One other way is to demand cash for any 'service'' that would be rendered if you didn't pay the loan. As long as you're making good on your end of the deal, you can expect that the creditor will keep collecting on the cash.
