Payday Loans are Legal in Colorado

Beware of predatory lending

Payday Lenders in Colorado

Payday loans in Colorado serve as short-term lending solutions designed to address urgent financial needs, including unexpected bills, medical expenses, or car repairs. These loans are particularly popular among individuals with low credit scores or no credit history, as they provide access to funds when traditional bank or credit union loans are not readily available. Despite the high rates and fees associated with payday loans, they remain appealing due to their accessibility.

However, in Colorado, the state has implemented specific regulations to protect borrowers. Notably, the Colorado Predatory Payday Loan Prevention Act imposes an APR cap of 36% on consumer loans, safeguarding borrowers from falling into the debt trap often associated with payday loans.

When choosing a payday loan lender in Colorado, thorough research is crucial. It is essential to assess the reputation and terms of the lender. Opting for licensed lenders ensures compliance with the required caps on interest rates and fees in place to protect borrowers. Transparency regarding fees and interest rates is also a key consideration. It is advisable to be cautious of lenders employing aggressive advertising tactics such as guaranteed approval or no credit checks. Checking online reviews and ratings can provide insights into the lender’s reputation and the quality of customer service they offer, aiding in making an informed decision.

Payday Loan Laws

Colorado has implemented robust payday loan laws that prioritize borrower protection and promote responsible lending practices. These laws have effectively outlawed the practice in the state. There are stringent regulations governing payday lenders in the state, ensuring fairness and transparency in the lending process. Colorado sets specific limits on loan amounts while also imposing strict guidelines on finance charges. These comprehensive laws aim to safeguard borrowers from the pitfalls of predatory lending and foster a climate of responsible lending practices throughout the state.

Loan Terms and Conditions

Maximum loan amount: $500

Maximum Interest Rate: 36%

Minimum loan term: no minimum specified in regulation

Maximum loan term: 120 days

Number of rollovers allowed: none

Finance Charge: Origination fee based on loan amount. Cannot make APR exceed 36%

Legal action: 3 Years

Certified Payday Lenders in Colorado

Company Name	Company score	License Status
Populus Financial Group, Inc	7.9	Valid
LDF Holdings, LLC	7.6	Valid
Tribal Lending Enterprise, Inc.	6.5	Valid
CURO Intermediate Holdings	6.1	Valid
LCO Financial Services, LLC	5.8	Valid
Moneytree Inc	5.3	Valid

History of Colorado Payday Loans

Throughout Colorado’s history, the trajectory of payday loans has been marked by a series of transformative reforms aimed at safeguarding consumers and redefining lending practices. In the early 2000s, payday lending thrived, with sky-high interest rates reaching the triple digits. In 2007, a reform initiative attempted to address the issue but encountered hurdles due to conflicting goals and an inability to rectify the inherent problems. It wasn’t until 2010 that a pivotal shift occurred, as Colorado implemented new legislation demanding lower interest rates and extended repayment terms, a testament to the state’s commitment to borrower protection. Yet, the true breakthrough arrived in November 2018 when Proposition 111 ushered in substantial change. By capping interest rates and fees at 36%, this measure effectively dismantled the landscape for payday lenders in Colorado. This comprehensive overhaul not only relieved small-loan borrowers of the burdensome financial strain associated with payday loans but also rendered the industry unviable, signaling a turning point in the state’s lending regulations.

State Resources

How to file a complaint

Borrowers can submit a complaint against a payday lender through the Attorney General’s Consumer Protection Section. There is an online form available on their website and the more information that can be provided the better their response can be. There are also resources available through their Consumer Mediation Program to assist borrowers with informal negotiations with a lender.

Colorado Payday Loans Debt Relief

How to Get out of Payday Loan Debt?

IIf you find yourself unable to get out of payday loan debt in Colorado, there are some steps you can take to try and regain control of your financial situation. Start by initiating open communication with your lender to discuss the possibility of renegotiating the repayment terms or developing an alternative plan that works for both parties. Exploring options like debt consolidation or a debt management plan can help consolidate your debts and potentially lower the interest rates you’re facing. Additionally, consider seeking additional sources of income, such as taking on a part-time job or selling unused belongings, to increase your cash flow and repay the loans more effectively. If you feel overwhelmed managing the debt on your own, seeking guidance from credit counseling services or consulting with a bankruptcy attorney can provide valuable insights and assistance in navigating your way out of payday loan debt.

Support Resources

Types of Quick Loans in Colorado

Credit Card Cash Advance Credit card cash advances provide a convenient way to access immediate funds by borrowing against the available credit on your card. However, while they offer quick access to money, they often come with high interest rates and fees. In Colorado, the maximum interest rate for cash advances is regulated by the state, ensuring consumer protection. It's advisable to use cash advances sparingly and consider alternative options if possible, as the accumulated interest can make repayment challenging.

Installment Loans Installment loans offer a flexible borrowing option for individuals in Colorado who need funds for various purposes. With an installment loan, borrowers receive a lump sum upfront and repay it in regular installments over a specified period. This allows for better budgeting and planning. In Colorado, installment loans are subject to specific regulations to protect consumers. Lenders must adhere to the state's maximum interest rates and fee limits, ensuring fair and transparent lending practices. It's important to research and compare different installment loan options, considering factors such as interest rates, repayment terms, and fees. By understanding the terms and selecting a reputable lender, borrowers can make informed decisions and secure installment loans that suit their financial needs.

Lines of Credit Personal lines of credit offer a flexible and convenient borrowing option for residents of Colorado who require access to funds on an ongoing basis. A personal line of credit functions similarly to a credit card, providing a predetermined credit limit that can be used as needed. Unlike traditional loans, interest is only charged on the amount borrowed, not the entire credit limit.When considering a personal line of credit, it's important to compare different lenders, evaluate interest rates and fees, and understand the terms and conditions. By maintaining responsible borrowing and timely repayments, individuals can effectively manage their personal lines of credit in Colorado.

Alternatives to Payday Loans in Colorado

Personal Loans

Personal loans are a popular type of unsecured loan that is available in Colorado. Borrowers use these loans for various purposes, such as home improvements, debt consolidation, or unexpected expenses they might encounter. Personal loans come with fixed interest rates and set monthly payments, making them easier to budget than other types of loans. Borrowers with excellent credit can typically access lower interest rates and more favorable repayment terms from lenders. In comparison, those with poor credit may face higher rates and stringent eligibility requirements from creditors.

Bridge Loans

The name of a Bridge Loan speaks for itself. It is a short-term borrowing solution designed to bridge the gap between selling your current home and purchasing a new one. A Bridge Loan allows you to leverage the equity accumulated in your existing home to finance a down payment or mortgage on your new property. The monthly payments consist only of interest, with a shorter term and fixed interest rates, until your current home is sold and the Bridge Loan is repaid in full. Compared to conventional home loans, Bridge Loans typically have a quicker application, approval, and funding process, making them an attractive option for those who need immediate funds to secure their new home.

Home Equity Loans

Home equity loans give homeowners an opportunity to borrow money based on the equity they have built in their homes. They are flexible and can be used for many different purposes, such as paying for home renovations, consolidating debt, or making big purchases. Home equity loans usually carry lower interest rates since they are secured by the home. Borrowers need to realize, though, that taking out money against the equity in their home puts it at risk, and failure to repay the loan could lead to foreclosure proceedings being taken against it. It is crucial to approach home equity loans with caution, as they can come with both benefits and risks.

Bad Credit Loans in Colorado

Bad credit loans are a type of loan that is available to borrowers in Colorado who have poor credit or limited credit history. These often have higher interest rates and more fees than traditional loans and could require collateral or a co-signer to qualify. Bad credit loans can be used for debt consolidation, home repairs, or unexpected expenses.

Colorado Small Business Loans

Small business loan options in Colorado:

SBA loans: This federal program provides loans to small businesses through banks and other approved lenders.
Colorado Economic Development Commission (EDC): State agency offering various loan programs and financial incentives to support economic growth and job creation in Colorado.
Colorado Enterprise Fund: Nonprofit lender offering small business loans with flexible terms and support services to promote economic development in Colorado.
Traditional Bank Loans: Loans provided by banks and financial institutions that offer competitive interest rates and terms based on the creditworthiness of the borrower and the business.
Business Lines of Credit: Revolving lines of credit extended by banks or credit unions, allowing businesses to access funds as needed and repay them over time.

VA loans in Colorado

VA loans are a type of home loan available to veterans, active-duty military members, and their spouses. In Colorado, VA loans are backed by the Department of Veterans Affairs and offered by various lenders. VA loans provide several benefits, including no down payment requirements, no private mortgage insurance (PMI), and competitive interest rates. Additionally, VA loans allow borrowers to finance up to 100% of the home's value, making homeownership more accessible for those who have served their country. To qualify for a VA loan in Colorado, borrowers must meet certain eligibility requirements, such as having a valid Certificate of Eligibility and meeting minimum credit score and income standards. Overall, VA loans can be a great option for eligible veterans and military members looking to purchase a home in Colorado.

Colorado Student Loans

Many options are available to Colorado students to help finance their college education. These options include:

Federal Student Loans: These loans are provided by the government and typically have lower interest rates and flexible repayment options.
Colorado CollegeInvest: State-sponsored student loan program offering competitive fixed interest rates and flexible repayment options for Colorado residents attending in-state or out-of-state schools.
College-specific Loan Programs: Some colleges or universities in Colorado may offer their own loan programs or alternative financing options to assist students with educational expenses.
Parent Loans: Parent borrowers can consider options like the Federal Parent PLUS Loan, which allows parents to borrow on behalf of their dependent undergraduate students to help cover education costs.
Private Student Loans: Offered by banks and other lenders, these loans can be used to cover educational expenses not covered by federal loans.

Colorado Income Information

The recently released 2021 U.S. Census reports show Colorado having a median household income of $80,184, significantly higher than the national median of $69,021. Colorado boasts a diverse and robust economy driven by sectors such as aerospace, technology, tourism, agriculture, and renewable energy, contributing to its overall resilience and consistent economic growth. Colorado’s median household income varies widely by county, with Douglas County being the highest at $121,393, 61% higher than the state average, and Conejos County being the lowest at $33,611, 55% below the state average. The state’s poverty rate was 9.7% in 2021.

United States Census Bureau. “Poverty in the United States: 2021.” Accessed on May 8, 2023.
United States Census Bureau. U.S. Census Bureau QuickFacts: Colorado. Accessed on May 8, 2023.

Colorado Payday Lender Complaints

Below are trends associated with some payday lenders in Colorado, as reported to the Consumer Financial Protection Bureau.

Company Name	Count
Populus Financial Group, Inc. (F/K/A Ace Cash Express)	18
LDF Holdings, LLC	10
Tribal Lending Enterprise, Inc.	7
CURO Intermediate Holdings	6
LCO Financial Services, LLC	5
Moneytree Inc	5
Total Complaints	156

Consumer Financial Protection Bureau. Consumer Complaint Database. Accessed on May 8, 2023.

Most Common Issues

Complaint type	Count
Unexpected fees or interest	61
Struggling to pay loan	20
Can’t contact lender	18
Received a loan didn’t apply for	15
Loan payment wasn’t credited	7

What are the main reasons residents of Colorado apply for payday cash advance online or offline

Payday loans are typically used for nonnegotiable everyday expenses like your rent, utilities, and groceries. Per data reported by Pewtrust, the percentage of reasons described below

Reason	Share
Regular Expenses (Utilities, car payment)	53%
Unexpected emergency/expense	16%
Rent/Mortgage	10%
Something Special	8%
Other	5%
Did not answer	2%

Payday Lenders by City

Denver
Colorado Springs
Aurora
Fort Collins
Lakewood
Thornton
Arvada
Westminster
Pueblo
Centennial

Greeley
Boulder
Highlands Ranch
Longmont
Loveland
Broomfield
Castle Rock
Grand Junction
Commerce City
Parker

Littleton
Security-Widefield
Brighton
Northglenn
Dakota Ridge
Ken Caryl
Englewood
Pueblo West
Wheat Ridge
Windsor

Frequently Asked Questions

Will applying for a payday loan impact my credit?

Applying for a payday loan in Colorado may impact your credit, as some lenders will check your credit score during the application process, which can result in a soft or hard credit inquiry.

What do I need to apply for a payday loan?

To apply for a payday loan in Colorado, you typically need to provide personal information, proof of income, and an active checking account, with additional requirements varying depending on the lender.

Can I cancel my payday loan?

Borrowers are entitled to a full refund of all fees and interest paid if they cancel the loan by the end of the business day following the day it was issued according to Colorado law.

Can a payday loan lender garnish my wages?

Yes, a payday loan lender in Colorado can potentially garnish a borrower’s wages with a court order if they default on the loan.

Can spouses have separate loans?

Yes, spouses can have separate loans in Colorado. Each individual can apply for a loan based on their own creditworthiness and financial situation, and the loan will be in their own name.

When will I receive my funds if I am approved for a payday loan?

If approved for a payday loan, funds can typically be received on the same or next business day through direct deposit, depending on the lender’s policies.

What happens if I can’t repay my payday loan on time?

If a borrower is unable to repay their payday loan on time, they may be charged late fees, reported to credit bureaus, and potentially sued to collect the debt, and while the lender may offer to extend the repayment period, this can result in additional fees and interest charges, so it’s important to communicate with the lender to discuss repayment options and potentially avoid defaulting on the loan.

When could I apply for another payday loan?

In Colorado, the cooling-off period for payday loans is 30 days. This means that borrowers must wait at least 30 days after repaying a payday loan in full before they can take out another loan from the same lender.