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Virginia did not ban these loans — it rebuilt them. 36% plus a capped maintenance fee, no balloon payment, and a hard ceiling on total charges.
Quick answer · state law checked 2026-10-31
Is a payday loan legal in Virginia? No. Virginia does not authorise storefront payday loans (rate ceiling about 36% APR).
What can it cost? The 2020 Fairness in Lending Act ended the single-payment product: short-term loans must be 4-24 month installment loans at 36% plus a limited monthly fee; max loan $2,500.
If the loan goes unpaid: a collector has 5 years to sue, at most 25% (floor of 40x higher of fed/VA min wage) of your pay can be taken after a court judgment, and you cannot be jailed for the debt. Details and sources below.
The Fairness in Lending Act of 2020 renamed “payday loans” as short-term loans and rewrote them: bigger, longer, cheaper, and with no balloon payment at the end.Virginia · StatuteHB 789 (2020) — replaces references to payday loans with short-term loans; caps interest and fees at 36 percent plus a maintenance fee; raises the maximum from $500 to $2,500
Before reform, the statute authorised balloon-payment loans with APRs exceeding 300%. Research had found Virginians routinely charged three times what borrowers in lower-cost states paid.Virginia · ResearchPew Charitable Trusts — before reform the short-term loan statute authorised balloon-payment loans with APRs exceeding 300%
Fees and charges may not exceed 50% of the original loan where that amount is $1,500 or less, or 60% where it is more. That is a hard ceiling on total cost, separate from the rate cap.
And the four-month minimum term does not apply if your monthly payments are held to 5% of gross or 6% of net monthly income — so a shorter loan is only permitted when the payment is genuinely affordable.Virginia · ResearchPew analysis of the Fairness in Lending Act — the four-month minimum term does not apply if monthly instalment payments are limited to 5% of gross or 6% of net borrower monthly income
You can revoke authorisation and instruct your bank to stop the payment, whatever your agreement says.
What Regulation E says about automatic payments →
Every figure carries the jurisdiction and the exact provision it came from. Click to open the source.
A payday loan is a consumer debt. If it goes unpaid, two Virginia 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 →