What a payday loan costs — before New Jersey’s rules
A payday loan typically costs $15–$20 per $100 borrowed for a two-week term — roughly 400% APR — and is due as a single lump sum on your next payday. That single-payment structure, not the fee on any one loan, is the trap: most fees come from borrowers who cannot clear the balance in one go and roll it over. Where a state caps rates below payday levels, licensed payday lending disappears and a loan above the cap is generally void — not legally collectible, whatever the contract says.
The law in New Jersey
- Rate cap
- 30% criminal-usury ceiling on consumer loans — higher-rate loans are a crime. No payday-lending carve-out exists.
- Key law
- N.J.S.A. 2C:21-19 (criminal usury, 30%, from the 1979 Code of Criminal Justice).
- Enforcement
- In MacDonald v. CashCall (3d Cir. 2018), the court refused to enforce a Western Sky/CashCall tribal arbitration clause against a NJ borrower, and Third Circuit rulings have rejected "arm-of-the-tribe" immunity where profits didn’t flow to the tribe.
New Jersey has criminalized lending above 30% since 1979, making it one of the toughest anti-payday states.
What it means for a New Jersey borrower
Payday lending is prohibited and loans above 30% are criminally usurious, so tribal high-rate agreements are generally unenforceable in New Jersey courts. Lenders operate online but cannot reliably collect.
If you already have a payday loan in New Jersey
A loan that violates New Jersey’s rate limits may be partly or fully unenforceable — which changes your options with the lender and any collector. This is general information, not legal advice.
- Complain to the NJ Division of Consumer Affairs / Department of Banking and Insurance.
- Treat any loan above 30% APR as unenforceable and seek legal aid.
Cheaper first — try these before a payday loan in New Jersey
Payday Loans and tribal lenders in New Jersey
Many online lenders that market payday loans to New Jersey residents are tribal lenders arguing their sovereignty places them outside state rate caps — a separate legal question this site tracks in depth. For which tribal brands lend to New Jersey residents and how state law applies to them, see the New Jersey tribal-lending page.
Tribal loans in New Jersey →Frequently asked questions
Are payday loans legal in New Jersey?
In New Jersey, payday loans are legal but tightly limited. The state caps loan size, fees or rollovers, so a legal payday loan looks different — and costs less — than the ~400% APR norm, and any lender exceeding those limits is out of compliance.
What is the maximum payday loan rate in New Jersey?
30% criminal-usury ceiling on consumer loans — higher-rate loans are a crime. No payday-lending carve-out exists.
What can I do about a payday loan I already have in New Jersey?
Because New Jersey restricts high-cost payday loans, a loan that exceeds the state limit may be partly or fully uncollectible. Complain to the NJ Division of Consumer Affairs / Department of Banking and Insurance. This is general information, not legal advice.