Schneiderman Makes Five Companies Pay for Payday Loans
Buffalo, NY (WBEN) The State's top prosecutor has reached a deal with five companies which collected payday loans.
Payday loans are a type of short-term borrowing where an individual borrows a small amount from a payday lender at a very high rate of interest.
Many consumers cannot afford to pay off the loan when it becomes due and must extend, or roll over the payment period by paying additional interest. Even when a consumer can pay, many payday lenders renew the payday loan automatically, deducting only interest from the consumer's bank account without paying down the principal. Consumers take out new payday loans to pay off the old and often end up being trapped in a cycle of debt.
The five are:
V&R Recovery, Inc. DBA Alexander & Stefano, 3411 Delaware Ave, Kenmore, NY 14217
RJA Capital, Inc., 461 Ellicott Street, Buffalo, NY 14203,
Westwood Asset Management, LLC, 2316 Delaware Ave, Buffalo, NY 14216
Erie Mitigation Group, LLC, 3711 California Road, Orchard Park, NY 14127
Northern Resolution Group, LLC, 501 John James Audubon Pkwy, Amherst, NY 14228
The companies will pay a total of $279,605.98 in restitution and $29,605.98 in penalties. In addition, one debt-buying company was required to reverse 8,550 negative credit reports it had made to credit reporting bureaus on New Yorkers, and is prohibited from collecting on $3,200,000 in payday loans taken out by New Yorkers. All of the companies will be prohibited from collecting on payday loans from New Yorkers in the future.