Personal Loans in West Virginia: What Licensed Lenders May Charge

How the West Virginia rate tiers work

Section 46A-4-107 sets the most a regulated consumer lender may charge, as a yearly rate on the unpaid principal balance under the actuarial method. Unlike states that blend rates across slices of one loan, West Virginia sets the rate by the size of the whole loan.

On a nonrevolving loan above $3,500, origination fees, points and investigation fees together may not exceed 2% of the amount financed; on a loan secured by real estate the limit is 5%. On an unsecured loan of $3,500 or less, the lender may instead charge the 31% rate plus a nonrefundable processing fee of up to 2% of the amount financed, with no other finance charge.

Here is the small-loan case worked out. Borrow $2,000 for 24 months at 31% with a $40 processing fee added to the balance: the payment is $115.11, you repay $2,762.64 in all, and the APR on your Truth in Lending disclosure comes to about 33.2%. These figures are an example, not an offer.

How West Virginia compares with its neighbors

On the NCLC comparison of a $2,000 two-year loan, Pennsylvania caps that loan at about 24% APR, Maryland at 30% and Ohio at 31%, while Kentucky allows about 42% and Virginia about 50%. If you live near a state line, your state of residence and the lender's license decide which rules apply, not where the lender is based. The state rules map shows every state side by side.

Who needs a license and who does not

Under W. Va. Code § 46A-4-101, no one may make regulated consumer loans, or take assignments of, collect on or enforce such loans, without first getting a license from the commissioner. The West Virginia Division of Financial Institutions supervises regulated consumer lenders, which it describes as generally known as finance companies.

• State-chartered banks and credit unions are supervised by the same Division under their charters. National banks and federal credit unions answer to federal regulators, and a bank may charge the rates its home state allows.
• Online lenders that partner with a bank may make loans through that bank, which can put the loan outside the West Virginia tiers. Ask who the lender of record is before you sign.
• Payday and auto title loans are a separate subject. Our sister site Lendmira covers them on its West Virginia lending laws page.

If a lender asks for a fee before it will approve or fund the loan, treat it as a warning sign; how to verify a lender explains what to check.

Check a lender and file a complaint

1. 1 Look up the license in NMLS Consumer Access, or call the Division of Financial Institutions at 304-558-2294, before you apply.
2. 2 Check the rate and fees against the tiers above, and the APR on the disclosure against about 33% for a small loan.
3. 3 Keep the loan papers: the Truth in Lending disclosure, the agreement and any messages about fees. Send copies, not originals, with a complaint.
4. 4 Complain in writing to the Division using the form on its consumer complaints page, by mail to 900 Pennsylvania Ave, Suite 306, Charleston, WV 25302, or by fax at 304-558-0442.
5. 5 Send a complaint to the CFPB as well if the lender is a national bank or a bank partner, or if you are unsure who regulates it.

Questions people ask