A payday loan over the internet is not illegal, at least to my knowledge of Maryland law. It would operate just like any other consumer loan, although probably come with an unreasonable interest rate. If you get money from a lender, then you should pay the loan or risk being sued for the balance owed. 0 found this answer helpful The center told Taylor that the types of loans he had been given were illegal in Virginia, where state law says Internet payday lenders can’t charge more than 12 percent annual interest without a license. A lawyer for Silver Cloud Financial, which gave Taylor the first loan, said that the transaction did not break any laws. Joan Loughnane, the Acting Deputy United States Attorney for the Southern District of New York, announced today that SCOTT TUCKER was sentenced to 200 months in prison for operating a nationwide internet payday lending enterprise that systematically evaded state laws for more than 15 years in order to charge illegal interest rates as high as 1,000 percent on loans. Now even though these types of loans are illegal in your state we all agree it the right thing to do to pay back what you borrowed. You will have to make payment arrangements with them. Please read the bank info and then spend a few minutes reading about the lenders in some of the posts we have here. You can learn alot. Unfortunately, internet payday loan companies are rampant and you need to figure out if they are indeed illegal. Since in your particular situation you found out they are and did file a complaint, you need to also ensure your loans are not simply (as a result of the complaint or otherwise) sent off to a collections agency. Welcome! You are right, PDLs are prohibited in NY. I, too, live in NY so I have been through this as well. Taking out PDLs shouldn't be done in any state, but to answer the question, they should not be offered to NY State residents. According to information posted on the Credit.com web site, Maryland requires payday lenders to comply with the state’s small loan or criminal usury laws. Basically, since the allowable interest rates and fees are much lower than what the payday industry usually charges, payday lenders in these states are probably operating illegally. Internet payday loansare illegalin Virginia. They are a felony. (In order to make payday loans in Virginia, they have to have a licensed office in Virginia. The internet payday loans do not have offices Virginia–they are on the internet.) Are Internet Payday Loans Illegal. Rates and terms are subject to change without notice and membership is required. Prosper for borrowers Loan calculator for Lending Club and Prosper Peer to peer lending made easy. The remaining six states have low interest rate limits that make these loans unprofitable. After doing research regarding Internet payday loan laws in the State of Washington, I have found that your Internet payday loans are actually illegal.