As provided by CFSA’s Best Practices, a customer who cannot pay back a loan when it is due has the option of entering into an Extended Payment Plan (EPP). This service allows the loan to be repaid over a period of additional weeks. CFSA member companies provide this option to customers for any reason and at no additional cost.
Subject to applicable state laws, a CFSA member will provide an EPP to a customer who is unable to repay a loan when due. Some states have adopted statutory provisions for an EPP, and in those states, the state-mandated EPP is the plan that will be offered to a customer, not the CFSA’s EPP.
To receive the CFSA EPP:
A customer must ask for the EPP by close of business on the last business day before the loan due date by returning to the office where the loan was originated or by using whatever method was used to obtain the loan. To receive the EPP, a customer must sign an amendment to the loan agreement reflecting the new payment schedule.
Under an EPP, a customer may pay the transaction balance in four equal payments coinciding with periodic pay dates.
There is no charge to enter into an EPP. However, if a customer defaults on an EPP, a lender may charge an EPP fee and accelerate payment on the balance remaining, as authorized by law.
The lender will not begin collection activities while a customer is enrolled in the EPP as long as all obligations under the EPP are met. If, however, a customer does not repay the loan as agreed to in the EPP amendment, a company may take action to collect the outstanding balance. In the case of default, a customer may also be subject to additional fees and charges as provided for in the loan agreement or by law.
A customer is allowed to utilize an EPP at least once in a 12-month period.