Payday Loans in Minnesota: $350 and $1,300 Loans Under a 50% Cap

Yes, you can get a payday loan in Minnesota, but since January 1, 2024, every fee counts toward a 50% APR cap. A $350 loan for 30 days costs no more than $14.38, and any loan above 36% APR requires a check that you can afford to repay it.

What $350 to $1,300 Costs Under Minnesota's 50% Limit

Worked out from Minnesota law, not offers from lenders in our network; a lender can charge less.

The cap includes everything: no other charge may be added. After a small loan's due date, the rate on what's left can't exceed 2.75% a month, and a bounced check on a loan made against your check can cost up to $30.

Consumer Small Loan or Short-Term Loan: Minnesota's Two Payday Types

A small loan can't be paid off with another small loan from the same lender, and your outstanding small loans can't total more than $350 in principal. On a short-term loan or line of credit, each new advance counts as a new loan.

The Ability-to-Repay Test for Loans Above 36% APR

• What the lender collects. Documented proof of your net income, housing cost, other debts and basic living expenses. A credit report can stand in for your debts.
• The test. A debt-to-income calculation must show you can repay, keep up with other obligations and cover living expenses until 30 days after repayment.
• If a lender skips it. It faces the same penalties as other payday violations, and Commerce can revoke its license or filing.

Before and After Minnesota's 2024 Payday Law

In 2022, 25,096 Minnesotans took out 160,050 payday loans worth $67.9 million, Commerce reported, down from 330,430 loans in 2017. A 2023 law then changed the rules for loans made from January 1, 2024:

• Finance charges and fees capped at 50% APR, with an ability-to-repay analysis above 36%.
• The short-term loan limit raised to $1,300, from $1,000.
• A no-evasion rule covering anyone who makes, offers, assists or arranges a loan above these limits, online or off.

Regulated Installment Loans: Minnesota's 33% Small-Balance Rate

Larger or longer loans come from regulated lenders licensed under Chapter 56. They can charge the greater of 21.75% APR or a blended rate of 33% a year on a lower tier of the balance and 19% above it, plus, on smaller loans, a onetime administrative fee of up to $25.

Worked out from Minnesota law, not offers from lenders in our network; a lender can charge less.

On a loan of $1,300 or less, owing more than 25% within 60 days makes it a short-term loan under the 50% rules instead.

Three Steps to a Licensed Minnesota Loan Request

1. Gather your ID, proof of income, bank details and a list of monthly bills; lenders charging over 36% APR must document them.
2. Submit one request through LendUp. Lenders in our network review it, and any offer shows the APR, payments and total cost before you sign.
3. Check the APR on the contract; a short-term loan must print it in bold 24-point type. On a payday loan it can't exceed 50%, fees included.

Checking a Lender in Minnesota Commerce's License Lookup

1. Search for the company's legal name, usually in the website footer.
2. A short-term lender generally holds a regulated lender license or an industrial loan and thrift certificate; a small loan lender files with Commerce.
3. Online lenders need Minnesota authority too, even without an office in the state.

Questions or complaints: Commerce's Consumer Services Center, 651-539-1600 or [email protected].

• Unlicensed or overpriced loans are void. If the lender lacks a required license or charges more than the law allows, you don't owe the amounts due.
• Damages. You can recover what you paid, damages, up to $1,000 per violation and attorney fees.
• Military borrowers. Federal law caps most loans to active-duty servicemembers and covered family members at a 36% Military APR.

Common Questions

Official Sources

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