Deadline approaching for payday loan restitution
FRESNO, Calif. (KFSN) -- You could have money coming back if you once took out a payday loan to help make ends meet.
Quick cash lenders Money Mart and Loan Mart have been ordered to pay millions in restitution for fraudulent lending practices.
People who qualify took out high-interest loans from Money Mart or Loan Mart between 2005 and 2007. A claim form needs to be completed by October 1st to be eligible.
The valley is home to 19 Money Marts and Loan Marts between Merced and Tulare. They number over a hundred statewide.
Many people who took out payday loans, advances on their paychecks, were charged interest rates as high as 400%.
But under a lawsuit settlement negotiated by San Francisco city attorney Dennis Herrera, Money Mart and Loan Mart must pay over $7.5 million dollars for predatory lending practices.
Herrera said, "It's incredibly important that we get the word out. In addition, Money Mart and Loan Mart have also forgiven an additional 8-million dollars in loans that they've made to other Californians."
Victims can get refunds ranging from $20 to $1800 for interest, fees and finance charges.
State Senator Michael Rubio of Shafter said the high-interest loans targeted the working poor. Rubio explained, "We know for the families that we're talking about with the lower socio-economic base here in Fresno county $1800 means the world for them. It's a game changer."
Money Mart and Loan Mart have reduced their loan fees to 35%.
Martha Lucey of ClearPoint Credit Counseling has been helping track down high-interest loan victims. Lucey said, "We see people every day that go through payday lenders and paid exorbitant fees and so it's great there is a settlement like this to help people recoup some of the predatory fees that they paid."
If you have any questions you can call the restitution fund hot line at (866) 497-5497 or visit its website.
Other payday lenders use similar loan tactics. Herrera expected to soon see another settlement involving another company.
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