Best Loans In Delaware, Payday, Auto Title Laws 2019 - Elite Personal Finance
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Best Loans In Delaware, Payday, Auto Title Laws 2019

EPF August 15, 2019
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Licensed Lenders in Delaware are required to cap short-term installment loans at $1,000. These are loans of less than 60 days that are “not secured by title to a motor vehicle.” However, the state does not regulate APRs. Finalized rates are negotiable and determined by the lender and the borrower.

In 2012, Delaware’s state legislature passed House Bill 289, which increased the limit on short-term loans from $500 to $1,000. To protect consumers from falling into a cycle of debt, the bill also restricts borrowers from taking out more than 5 loans over a 12-month period.

Prior to issuance, licensed lenders are also required to search Delaware’s Consumer Loan Database to assess:

  • How many short-term loans a borrower currently has open
  • Whether a borrower is eligible for the loan in question
  • Other relevant information required to comply with regulations

If the screen is passed and a borrower is eligible for a loan, licensed lenders are also required to:

  • Enter the borrower’s name, address, social security or employment authorization number and gross monthly income into the database
  • Enter the loan amount
  • Enter the agreed upon APR
  • Enter the transaction date
  • Enter the expected repayment date

As well, licensed lenders need to update the database when a loan is paid-in-full or if a borrower defaults.

Best Bad Credit Loans In Delaware

Lender:Min Credit Score:Loan Amount:APR:Licensed in Delaware:
BadCreditLoans0$500 – $5,0005.99% – 35.99%Not a direct lender
CashUSA0$500 – $5,0005.99% – 35.99%Not a direct lender
Opploans0$1,000 – $4,00099% – 199%Yes
PersonalLoans580$1,000 – $35,0005.99% – 35.99%Not a direct lender

For more information on what these lenders have to offer, read our complete guide on bad credit loans.

Best Personal Loans for Good Credit In Delaware

Lender:Min Credit Score:Loan Amount:APR:Licensed in Delaware:
Payoff640$5,000 – $35,0005.99% – 24.99%Yes
Upstart620$1,000 – $50,0007.46% – 35.99%Yes
Upgrade620$1,000 – $50,0007.99% – 35.97%No, but complies with law
PersonalLoans580$1,000 – $35,0005.99% – 35.99%Not a direct lender
LendingTree500$1,000 – $35,0003.99% – 35.99%Yes

For more options, see our our list of recommended lenders.

You can also check out SuperMoney. They are one of the best loan comparison sites with plenty of options to choose from.

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Payday Loans in Delaware

Maximum Loan Amount: $1,000

Minimum Loan Term: Not specified

Maximum Loan Term: 60 days

Maximum Fee: No limit

Maximum APR: No limit

Rollovers: 4 per loan

Loan Limit: 5 per 12-month period

Payday loans are legal in Delaware.

The maximum amount is $1,000, and like we mentioned above, APRs are determined by the lender and the borrower. Through its research, the Center for Responsible Lending found that a typical $300 payday loan issued in Delaware has an average APR of 521%. The high cost of borrowing makes Delaware residents more likely to fall into a debt trap.

To that point, borrowers are allowed 4 rollovers per loan. However, they can’t take out more than 5 loans over a 12 month period. Non-sufficient funds (NSF) fees also can’t exceed $25.

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Car Title Loans in Delaware

Car title loans are legal in Delaware.

But like other short-term loans in the state, APRs are determined by the lender and the borrower.

As added protection, licensed lenders must provide borrowers with 7 disclosures – in writing – before a car title loan is issued:

  1. The loan you are considering entering into is strictly for short-term cash, and is not a solution for long-term financial problems.
  2. You, as borrower, are not compelled to complete the loan agreement merely because you have received any disclosures.
  3. If you sign the title loan agreement, the title loan lender will obtain a security interest in your motor vehicle, and if you fail to meet the obligations of the title loan agreement, the lender can take possession of your motor vehicle and sell it.
  4. If the lender takes possession of your motor vehicle, you may lose equity in that vehicle.
  5. You have a right to rescind the title loan agreement for any reason, at no cost to you, at any time up to the end of the business day following the day in which the loan proceeds of the title loan were disbursed to you by returning the full amount of the loan proceeds to the title lender.
  6. You have the right to receive information about credit counseling services from the Office of the State Bank Commissioner.
  7. You may file a complaint with the Office of the State Bank Commissioner if you believe your lender has violated any law regarding your title loan.

Borrowers can also cancel their loan for any reason – without penalty – before the end of the first business day. As well, if the lender fails to disclose any of the 7 tenants above, borrowers have the right to void the loan at any time within the first year. All fees, interest and charges are negated.

As it relates to rollovers, terms cannot extend beyond 180 days (or 6 months) from the original issue date. If the loan is not repaid by then, the borrower is in default.

However, to protect consumers, Delaware requires a ‘workout agreement.’ When a borrower defaults, the lender cannot immediately seize the vehicle. Instead, it has to put forward a plan to reduce “at least 10% of the outstanding and unpaid indebtedness on the loan every month.” Borrowers also have at least 10 days to accept the agreement before the lender can proceed with repossession.

When a vehicle seizure and sale occurs, borrowers are not liable for any shortfall between the selling price and the leftover balance on the loan. For example, if your loan is $2,000 and your car is seized and sold for $1,500, you don’t need to make up the additional $500. However, if the situation is reversed and your $1,500 loan nets the lender $2,000 from the vehicle sale, the lender is required to return the $500 excess to you.

Alternative Payday Loans In Delaware

Opploans is one of the best alternative lenders in Delaware.

The company provides financing solutions to borrowers who don’t qualify for personal loans, but want to avoid the high APRs of traditional payday loans.

The company is licensed through the Delaware State Bank Commissioner (License No. 013016). Typical installment loans range from $500 to $5,000, APRs average 160% and terms usually range from 9 to 18 months.

Credit Unions In Delaware

Name:APR:Amount:
DEXSTA Federal Credit Union6.99% – 18%$500 – $25,000
Tidemark Federal Credit Union8.74% – 18%$500 – $25,000

 

DEXSTA Federal Credit Union

At DEXSTA Federal Credit Union, you have 7 loan options to choose from:

  • Whatever Loans allow you to borrow anywhere from $500 to $7,500 with terms ranging from 12 to 48 months.
  • Lifestyle Loans allow you to borrow anywhere from $1,000 to $25,000 with terms ranging from 12 to 60 months.
  • Auto Repair Loans offer anywhere from $2,000 to $5,000 with terms up to 36 months.

DEXSTA also offers travel, medical, pet and secured loans, however, it doesn’t specify amounts or terms.

APRs also vary by duration:

  • Loans 36 months or less: As low as 6.99%
  • Loans 37 to 60 months: As low as 9.99%
  • Loans 61 to 72 months: As low as 10.24%
  • Secured Loans: As low as 2.40%

DEXSTA operates 6 branches across Delaware, with locations in Middletown, New Castle, Newark, Wilmington as well as others.

Tidemark Federal Credit Union

Tidemark Federal Credit Union provides loans for nearly every occasion. Whether its tuition, furniture, vacations, holidays or home improvements, Tidemark has your covered:

  • Signature Installment Loans allow you to borrow anywhere from $500 to $15,000 and APRs range from 8.74% to 18%. Terms also extend up to 72 months.
  • Signature Credit Lines offer funding up to $25,000. APRs are as low as 8.74% and terms are revolving.

Tidemark operates 6 branches across Delaware, with locations in Lewes, Millsboro, Milford, Seaford as well as others.

Student Loans In Delaware

Bradford Barnes Memorial Scholarship

Open to legal residents enrolled full-time at the University of Delaware, the B. Bradford Barnes Memorial Scholarship awards full tuition, fees, books and room and board to eligible students.

To qualify, you need a high school GPA of at least 3.0 and a 1290 SAT or equivalent ACT score. The application deadline is March 4 of each year and you can apply through the Delaware Higher Education Office’s Student Account website.

Delaware Diamond State Scholarship

The Delaware Diamond State Scholarship is open to legal residents of Delaware who are enrolled full-time at a non-profit regionally accredited institution.

To qualify, you also need a high school GPA of at least 3.0 and a 1290 SAT or equivalent ACT score. The application deadline is also March 4 of each year.

The scholarship awards $1,250 per academic year and hands out roughly 50 grants annually.

Federal Housing Administration (FHA) Loans In Delaware

3 counties in Delaware qualify for FHA loans. The lowest loan amount of $314,827 is offered in Kent, while the highest loan amount of $774,050 is offered in New Castle.

County:Lowest FHA Loan Amount:Highest FHA Loan Amount:
Kent County$314,827$605,525
Sussex County$336,950$648,000
New Castle County$402,500$774,050

Business Loans in Delaware

If applying online, the lenders below are a convenient way to obtain a reliable business loan:

Lender:Min Credit Score:Loan Amount:APR:Licensed in Delaware:
LendingTree500Varies5.99% – 35.99%Yes
Kabbage0Up to $250,00024% – 99%Not a direct lender

For a local alternative, you can also consult True Access Capital:

True Access Capital

True Access Capital is a non-profit, federally certified, Community Development Financial Institution (CDFI). Its goal is to stimulate growth across Delaware and Pennsylvania and the company has lent nearly $27 million to over 1,100 small businesses and organizations.

True Access has four loan products to choose from:

  • Micro Loans allow you to borrow anywhere from $5,000 to $50,000 and are designed to help start-ups expand and grow their operations. Loans can be used for general business purposes including working capital, inventory and equipment.
  • Business Growth Loans allow you to borrow anywhere from $51,000 to $250,000 and are typically used by businesses that have been in operations for at least two years. Typical uses include working capital, inventory, equipment, leasehold/capital improvements and real estate purchases.
  • Community Development Loans offer upwards of $500,000 and are designed for community-based projects like childcare centers and community centers.
  • SBA 504 Loans allow you to borrow up to $5 million and loans can be used to purchase land, buildings, fund leasehold improvements or purchase fixed assets and equipment. True Access partners with local banks to provide funding.

You can contact True Access by visiting its headquarters at: 100 W. 10th Street, Suite 300
Wilmington, DE  19801. You can also call them at (302) 652-6774 or (800) 652-4779 or inquire using the contact page on their website.

Conclusion

Installment and payday loan laws are quite lax in the state of Delaware. While licensed lenders are required to cap short-term loans at $1,000, APRs are determined by the lender and the borrower. And with APRs unregulated, borrowers are in vulnerable positions when seeking funds to cover emergencies. To help offset the effect, Delaware limits consumers to 5 payday loans per 12-month period. Licensed lenders also need to ensure eligibility by searching the state database. When it comes to car title loans, legislation is slightly more forceful. APRs are still unregulated, but the state does require licensed lenders to disclose all material information before providing funding. If they fail to do so, the borrower can exit the agreement penalty-free within one year. If default occurs, licensed lenders have to put together a ‘workout agreement’ before they can seize the vehicle. As well, if a seizure and sale does occur, borrowers are not liable for any shortfall, while lenders have to return any surplus.

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