Arizona Lending Laws


Different states feature various laws that govern the lending industry. These laws exist to protect borrowers from lenders that charge excessively high interest rates or structure loans in ways that prey on the desperate or vulnerable. Rules imposed on creditors include interest rate caps, limits on loan amounts, and guidelines on acceptable methods for banks to recover delinquent debt. Some states disallow certain loan products altogether, such as title loans and payday loans.

Arizona features a two-tiered system for regulating lending institutions. One set of laws applies to all traditional loans, such as mortgages, car loans, bank loans and credit cards. The state has carved out a separate legal framework exclusively for short-term loans, including title loans and payday loans, theorizing that the restrictive annual interest rate caps placed on other loan products are not necessary for loans that tend to be paid back within 30 days or less.

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