A personal loan can help cover immediate or unexpected expenses, such as an auto or large home appliance repair. Once you make the decision to apply for a loan, you agree to pay back the amount you borrowed (the principal), plus the interest and fees.
The four common types of loans are installment, payday, title, and pawn loans. In Oregon, lenders of these loans are limited in the interest rate and fees they can charge, and, in some cases, the loan’s length of time.
Your loan agreement
Before you agree to borrow money, make sure you understand the terms, including monthly payment amounts (if applicable), payment due dates, and late fees. Your lender should provide a written agreement showing the loan amount, fees, and annual percentage rate (APR). Do not sign the agreement if you do not see or do not understand this information. Once you get your loan, pay close attention to payment due dates to ensure you pay on time.
Paying off your loan
Making late payments, or skipping them, results in late fees (adding to your loan cost). In a title loan, it means your automobile can be repossessed. It also can negatively affect your credit score, a formula that lenders use to determine a potential borrower’s creditworthiness. A lower credit score, also known as a FICO score, may cause you to pay higher credit card interest rates or insurance premiums.
If you believe you have a loan by an unlicensed lender operating in Oregon, you can file a complaint.
Tribal payday lenders
Some payday and title lenders are owned by, or associated with, federally-recognized Indian tribes, and may explain that they operate under tribal sovereignty. Tribal sovereignty means they are separate from federal or state government and can make loans with higher fees and interest rates than those allowed by state laws. Currently, Oregon tribes are not involved in payday or title lending.
Before you search for, or agree to a loan, check to see that the lender has a license from the state of Oregon. You can check here for a list of lenders that are properly licensed in Oregon.
To file a complaint against a tribal-run payday/title lender, contact the following federal agencies:
Federal Trade Commission: 1-877-382-4357, or online.
Consumer Financial Protection Bureau: 1-855-411-2372 or online.