Can I cancel a payday loan agreement?
Question & AnswerCan I cancel a payday loan agreement?
2. If you change your mind after 2 days
After the 2-day cooling-off period, you can only cancel the agreement if the payday lender didn’t follow all the rules.
The rules say payday lenders can’t:
- charge and fees more than $15 for every $100 you borrow
- lend you more than 50% of your net monthly pay per loan
- ask you for
- ask you for a
- give you a new loan until the first one is paid off
- offer you other services when you apply for a loan, like buying your gold or jewellery, or cashing your cheques
- contact you more than 3 times a week or on statutory holidays
- take money from your paycheque to pay the loan
What payday lenders have to do
The rules say what has to be in a agreement. This includes things like:
- It must be in writing.
- It must be printed in text that is big enough to read easily.
- It must have details like:
- a 2-day cooling-off period, during which you can cancel the loan for any reason without paying any fees
- when you must repay the loan
- the total amount you must repay
- what it would cost to borrow $500
- the cost of borrowing as an annual interest rate for a 14-day loan
What you get
The rules say that as soon as you sign a payday loan agreement, the payday lender must give you:
- a copy of the agreement right away
- the full amount of the money you want to borrow — they cannot keep part of it to cover any fees or charges
- the money as soon as you sign the agreement in person, or within one hour if you make the agreement online
If you borrow from a payday lender over the internet, you can usually get the money by picking it up at their store, or they can deposit it into your bank account.