In 2017, the Consumer Financial Protection Bureau (CFPB) introduced the two-strikes rule. It aims to protect short-term loan borrowers from excessive attempted withdrawals from their bank accounts, which could result in high bank charges and overdraft fees. It finally came into effect after a Supreme Court decision in 2024. Since March 2025, this rule has been impacting Louisiana borrowers.
For the most part, the two-strikes rule has been beneficial for those who take cash advances in Louisiana, as it offers extra protection against spiraling bank fees. There are also a few downsides, which we will cover in this guide from Cash Cow in Louisiana below.
What Is The CFPB ‘Two-Strikes’ Rule?
The CFPB's two-strikes rule requires short-term lenders, including payday loan and installment loan providers, to limit the number of attempted withdrawals from a borrower’s account. As the name suggests, the maximum number is two. If the second withdrawal fails, lenders are required to get the borrower’s permission for further withdrawals.
The purpose of the regulation is to protect borrowers. Many people found themselves getting into increased debt due to bank charges and overdraft fees. The two-strikes rule aims to limit those fees.
The Benefits Of The Two-Strikes Rule For Borrowers
Many banks impose steep fees for failed withdrawals. Some people have found that their bank charges $30- $40 per failed payment. Before the two-strikes rule, lenders could attempt withdrawals as many times as needed. This could quickly lead to high bank charges, which borrowers obviously couldn’t afford.
Although fees for failed payments still exist, the new regulation seeks to keep them as low as possible. The two-strikes rule gives borrowers more control over their accounts. Since a lender is only allowed two attempts to withdraw, they must contact the borrower to try again. This gives borrowers time to move money, adjust their budget, or negotiate with their lender.
Lenders have also become much more responsible in their lending. Since payday loan lenders want to ensure they’ll recover their money within a maximum of two withdrawal attempts, they are being much more careful about who they lend to. This benefits borrowers because if a lender is willing to offer a cash advance, it knows there’s a reasonable chance you can repay the loan. This lowers the risk of the borrower falling into more debt.
How The ‘Two-Strikes’ Rule May Create Problems for Louisiana Borrowers
While the two-strikes rule does protect borrowers incredibly well, the introduction of the regulation does have a few downsides. Many lenders are becoming stricter on who they offer cash advances to. While bad and no-credit applicants are often still accepted, there’ll often be a much larger focus on income verification. If a lender believes a borrower is less likely to repay the loan, they’ll deny the application.
Borrowers are also finding that loan amounts may be limited. This can make it tougher to afford the larger emergency expenses. Here, we only approve loans of between $100 to $700. However, we’ve found that, for most people, this is more than enough to cover essential expenses until their next payday. On the plus side, it means the borrower will have much less cash to pay back.
Some borrowers have also found that the new rule adds extra pressure to them. Some lenders will no longer make automatic withdrawals and instead ask the borrower to let them know when cash is available. Sometimes borrowers forget, which can lead to issues. In other cases, if the two withdrawals fail, the onus is on the borrower to reach out to the lender.
How Payday Loan Repayment Strategies Can Reduce Issues
If you do receive a cash advance in Louisiana, you must have money in your account when the repayment is due. This helps to reduce extra fees and the hassle of discussing repayment with the lender. Remember – just because payment has failed, it doesn’t mean the debt is wiped out.
These payday loan repayment strategies can help:
- Make a note of when the cash advance will be taken – When you take out a loan, your lender will ask you when you’re paid next. Make sure this information is accurate, as the withdrawal will likely happen that day. Set alerts on your phone. This way, you can double-check that cash is available in your account on payment day.
- Include the repayment in your budget – You should have the right amount of cash in your account at the right time. Double-check that there are no other payments scheduled to leave your account, as they could leave not enough cash to cover the advance. Remember, payday loans collect interest, so you will need to have more than you initially borrowed.
- Keep in contact with your lender – If you have two failed withdrawals and have yet to hear from the lender, call them. They can’t withdraw money from your account without your permission, but the loan will still be payable. Get in touch and plan for repayment as quickly as possible to avoid incurring more interest.
Remember – it is in your best interest to ensure that cash is in your account at the right time. It will cut down on bank charges and extra loan fees, which, if you’re on a limited budget, can cause more issues. Only borrow as much as you feel you can repay with your next paycheck.
Access Payday Loan Funds Responsibly Under The New Two-Strikes Rule
At Cash Cow of Louisiana, we understand the challenges Louisiana residents face when unexpected expenses arise. We take pride in letting borrowers access much-needed cash advances responsibly, especially under the state’s new two-strikes rule, which exists to protect consumers.
Before offering loans, we ensure applicants can repay them. We accept bad credit or no credit borrowers, but only after confirming income to ensure manageable repayment. This helps you avoid extra fees and stress.
If you’re looking for a payday loan in LA, then we are an option. Our streamlined inquiry process ensures your application is handled quickly and effectively. With us, you could be approved for a cash advance in just a few hours.
How To Get Approved For A Cash Advance In Louisiana
Getting approved for a Louisiana payday loan takes only a few steps, and you can complete them the same day you apply. You will need three required items: a driver’s license or state-issued ID, your most recent pay stub, and a checking account. As long as you have these items, you can apply online and get approved in person within 30 minutes.
Here is how to get approved for a Louisiana cash advance:
- Fill out our online inquiry form with your basic information
- Answer a phone call to discuss payday loan terms
- Bring your required items to the nearest Louisiana store for verification
- Sign the loan agreement to finish the process
- Receive your cash advance funds later the same day or by the next business day
Borrow A Payday Loan In Louisiana – Receive Up To $700 Today!
While the new two-strikes rules will shake up the alternative lending market a little, there shouldn’t be too much impact on responsible borrowers. A cash advance in Louisiana will still be available from Cash Cow if you need emergency cash. Keep enough funds in your account to ensure on-time repayment.
Ready to get fast emergency cash? Start by filling out our online payday loan form today. After a brief in-person meeting, you could qualify for up to $700 within 30 minutes!
Note: The content provided in this article is only for informational purposes, and you should contact your financial advisor about your specific financial situation.
