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Two separate acts govern short-term lending here, and which one applies changes the rules. Fees may not be folded into your principal on conversion, and returned-check charges are capped at $30.
Two frameworks, and the one you are under matters
Delayed deposit transactions — payday loans — sit under the Mississippi Check Cashers Act, § 75-67-501 et seq. A separate and larger product operates under the Mississippi Credit Availability Act (MCAA), effective 1 July 2016.Mississippi · RegulationMississippi Department of Banking and Consumer Finance regulations — promulgated pursuant to Section 75-67-501 et seq., known as the Mississippi Check Cashers Act, to establish administrative regulations required by the Department
Both are licensed and examined by the Department of Banking and Consumer Finance, which the Department’s own materials describe as covering check cashers — expressly noted as payday lenders — alongside title pledge lenders, small loan companies and credit availability companies.Mississippi · RegulatorMississippi Department of Banking and Consumer Finance — the Division licenses and examines Money Transmitter, Small Loan, Check Cashers, Pawnbroker, Title Pledge, Consumer Loan Broker, Insurance Premium Finance, Motor Vehicle Sales Finance, Credit Availability and Debt Management Service Providers
Ask which act governs your loan. The rules are not the same.
This is the provision worth knowing. When a title pledge or delayed deposit loan is converted into an MCAA loan, no accrued interest or service charge may be capitalised or added to the original principal. Handling fees may be calculated only on the original principal of the previous loan, and charges owed from the previous loan must be itemised separately in the new written agreement.Mississippi · RegulationMississippi Credit Availability Act Regulations, Rule 6.13 — no accrued interest or service charge shall be capitalized or added to the original principal during any conversion of a Title Pledge Act loan to an MCAA loan; similarly no fees or charges shall be capitalized during conversion of a delayed deposit transaction; handling fees may only be calculated on the original principal of the previous loan; charges owed from the previous loan shall be itemized separately
Compounding fees into principal is how a short loan becomes a long one. If your new agreement shows a principal larger than the original amount borrowed, that is worth querying with the Department.
Thirty dollars is the maximum a licensee may charge for a check returned for any reason — insufficient funds, closed account, or stop payment.
Note the last one. If you instruct your bank to stop a payment, the lender may charge you no more than $30 for it. What Regulation E says →
Any processing fee must be disclosed in the delayed deposit agreement itself.
The Credit Availability Act was enacted with a sunset clause. The National Consumer Law Center recorded that Mississippi extended that sunset by four more years rather than letting it expire.
Sunset clauses exist to force a periodic decision about whether a law should continue. Extending one repeatedly converts a temporary authorisation into a permanent regime without ever holding the debate. Arizona and North Carolina show what happens when a sunset is allowed to operate.
You can revoke authorisation and instruct your bank to stop the payment, whatever your agreement says.
What Regulation E says about automatic payments →
A payday loan is a consumer debt. If it goes unpaid, two Mississippi rules decide what a lender can do next: how long it has to sue you, and how much of your pay a court can order taken.
Being sued over an old payday loan? A collector can still file, but the time limit is a defence you can raise — and you cannot be jailed for the debt. What can and cannot happen if you don’t pay →