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Utah Payday Loan Laws

What Are the Payday Loan Laws in Utah?

Updated on February 2, 2023

 Loan Laws

Utah is among the states in the U.S. where payday loans (aka deferred deposit loans or cash advance loans) are not prohibited. Since the cost of living in Utah is higher than the national average, many people struggle to make ends meet. That's why payday loans are quite popular in the Beehive State.

A study by the California State University Northridge shows there are approximately 430 companies that provide payday loans in Utah, each lending out 3,541 loans to borrowers living in it. It's also estimated that between 3% to 6% of the state's adult population gets at least one payday loan annually.

One of the contributing factors why payday loans are popular in Utah is its lenient laws and regulations. For more information about Utah payday lending, read this blog article.

Statutes Regulating Payday Loans in Utah

In Utah, payday loans are officially called deferred deposit loans. The Check Cashing and Deferred Deposit Lending Registration Act gives the Utah Department of Financial Institutions power to regulate the business of providing this type of loan to the state's residents.

It's a must for people who want to go into payday lending that the business operation is registered under state law. Otherwise, anyone is not allowed to collect or retain any fees or interest concerning deferred deposit loans.

If you don't have authorization, you can't lend payday loans or deferred deposit loans in Utah. It's also against the law to operate mobile payday cash advances in the said state until you apply for registration and observe the laws regarding payday lending.

Once your business is registered, you should ensure that you post a summary of the fees, payment schedule, and interest rates in a place in your store or office where borrowers can read it. You also must give your clients a copy of the contract that stipulates the terms, payment dates, and relevant fees.

How Much Can a Borrower Get?

Under the Check Cashing and Deferred Deposit Lending Registration Act , a payday loan company can lend out any loan amount to a borrower. Moreover, a borrower can apply for and take out several payday loans simultaneously. This is the attractive nature of payday lending in Utah: there's no limit to the payday loan amount and the number of loans a borrower can get.

What is the Maximum Payday Loan Term?

The maximum loan period for deferred deposit loans is ten weeks. It's a violation of the law for a lender and borrower to agree on rolling over a loan with a loan term shorter than ten weeks.

How Much are the Interest and Fees for Utah Payday Loans?

In Utah, the interest rates and fees for deferred deposit loans have no set limits. For every $300 loan amount taken out by a borrower, the annual percentage rate can be as high as 658%, making Utah among the states with the highest APRs for payday loans.

The high-interest rate for payday loans in Utah is advantageous to the lenders but a downside to the borrowers. With no set interest cap, there's a high chance for borrowers to get into a debt trap that's hard to escape.

Individuals who borrow shorter-term payday loans to pay for essential expenses are paying double the principal amount. If they're unable to pay back what they owe, some lenders sue them, and they often receive bench warrants for failing to show up in court.

Is there A Criminal Liability for Failing to Pay Utah Payday Loans?

Not paying your payday loan or deferred deposit loan is not a criminal offense. However, in Utah, payday loan providers can file a lawsuit against customers who fail to pay the required principal amount and interest. Yes, lenders may seek judgment against these delinquent borrowers, but the guilty is not considered a criminal.

In recent years, some borrowers were put into custody, and a majority of them are people who default on their loans. However, not paying or consolidating their debt in Utah is not the reason for the arrest. They were thrown into jail because they failed to attend the court hearings.

How Much is the Charge for Paying a Bounced Check?

Paying a bounced check to your lender may compel you to pay an additional $20 charge for the infraction. This fee for every bounced check is supported by the laws and regulations concerning payday loans in Utah.

Can People with Bad Credit Obtain Payday Loans?

The good thing about payday loans is that borrowers with no credit or low credit scores can still avail of the cash they need to borrow. Unlike auto loans or mortgages, payday loans are unsecured, small-amount loans that you can take out for the short-term.

Payday loan providers know that many people need short-term loans, and they're willing to lend money to people with bad credit. Borrowers only need to have a good source of income for them to get approved for payday loans.

Many payday loan companies don't even perform credit checks on their customers. However, they may need a credit report for deciding whether to approve borrowers who want to take out more significant loan amounts.

How Many Payday Loan Companies are in Utah?

Due to the not-so-strict regulations on payday loans or deferred deposit loans, over 400 companies in Utah offer this type of loan. They're enjoying a greater scope of freedom here than in any other state in the U.S.

Common Complaints by Consumers of Payday Loans in Utah

It's not to be avoided that consumers file complaints against payday loan companies for failing to play fair according to laws and regulations. Here are some of the common complaints filed by consumers.

  • Not receiving their loans
  • Unavailability of lenders during office hours
  • Unfair charges
  • Threat and fraud
  • Not exiting debt

Suppose you encounter a company that violates the laws and regulations on payday loans. In that case, you may file a complaint at the Department of Financial Institutions of Utah.


The laws and regulations on payday loans in Utah are quite lenient, allowing more freedom for lenders to provide cash to interested borrowers. However, if you need to borrow some money, it's crucial to remind yourself of payday loans' high-interest rates. You also need to know the law's ins and outs to prevent most borrowers' common mistakes.

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Ella Baker

Ella Baker is a blogger who writes about business, personal finance, and lending.

She has written blog articles for many websites as a guest writer, which helps people get informed about the topics she loves to write.

Aside from blogging, Ella is also a fitness enthusiast who likes to go to the gym.