Debt collectors have a limited time during which they can sue debtors for nonpayment. Such time limits differ by state and are set by each state’s statute of limitations. For example, in Texas, after four years the debt is time-barred and the debtor can no longer pursue a court judgment for collections. In some states where there is a 36% or lower rate cap in place and the loan is online, the loan could be illegal and thus not be required to be repaid because legally it is not collectible. Other states have limits on rollovers or other protections that may apply and allow you to stop payment. A local lawyer can provide more information.
The Military Lending Act (MLA) is a Federal law that provides special protections for active duty servicemembers, like capping interest rates and fees on many loan products. The MLA prevents a servicemember from being charged an interest rate more than a 36 percent Military APR, which includes certain fees, on most types of consumer loans. The MLA applies to active-duty servicemembers, including those on active Guard or active Reserve duty, and covered dependents. Payday loans are covered under MLA.