Can a payday loan company threaten me with warrants? 3 Answers as of August 23, 2012I took out a payday loan and the checking account associated with the loan was open at that time. The checking account was closed by the bank due to my failure to keep the account in good standing. Also, I was unable to pay the payday loan back. I resided in the State of Michigan as well. The payday loan attempted to cash the check and it was return for no payment due to account being closed. The payday loan had me come into thier office to rewrite another check from the account that they were aware was closed. They said it was an attempt to help me to prevent from being taken to court. I informed them that I was having a difficult time with my bills and I may not be able to pay them back but will try as I did submit some payment to them. Now they are calling me threatening to take me to court for three times the amount. The original loan was $600 and the guy said they are going to seek up to at least $3000 or more which will include legal fees. He said I will have 21 days to pay off this large amount and if I don't pay I will have a bench warrant placed on me. What rights do I have in this (if any). I'm not trying to get out of paying the loan but think as a place of business they should not be taking checks from an account they know is closed. Any insight will be greatly appreciated. Thanks.
Dennis P. Mikko Attorney at Law | Dennis P. Mikko
They should not be taking a check from an account they know is closed but you should not be writing checks on an account you know is closed. They could turn the matter over to the police for investigation and after review, the prosecutor may decide to issue criminal charges. As to what you own the company, you would have to look at the loan contract you signed with them. It may provide for severe damages if you don't pay on time as agreed. Unless there is a criminal case filed by the prosecutor or the company sues you in a civil proceeding, there can be no court order issued. Your best case is to make an agreement with the company and live up to it.
Answer Applies to: Michigan