Payday lender Advance Financial closes several dozen Tennessee stores

Nashville-based payday lender Advance Financial closed over 40 of its storefront locations Wednesday.

At its peak in 2021, Advance had 105 locations, but over the past few years it has reduced that number and now operates under 30 stores, according to the company’s website listing its current locations. 

Cullen Earnest, senior vice president of public policy at Advance Financial, said the company is restructuring and consolidating some stores because its “long-time retail customers learned to do business online during COVID and never went back.”

Advance Financial is one of the largest political spenders in Tennessee state politics. 

The company’s owners, Michael and Tina Hodges, were behind a 2014 law that created a new type of payday loan with a 279.5% annual interest rate, called a Flex Loan.

The Flex Loan removed many of the consumer protections that existed for other high-interest debt and sidestepped federal regulations at the time.

An investigation by the Lookout and ProPublica found that while Advance claimed its loans would be better for Tennesseans, it has used a provision in the new law to sue 110,000 borrowers in the decade since the Flex Loan’s passage.  

Borrowers have described how the company encourages them to keep borrowing, tearing a hole in the law’s safety net. The company also aggressively pursues outstanding debt using the court to garnish wages even from borrowers who have often paid back their loans multiple times over.

Tennessee House Speaker Cameron Sexton, a Crossville Republican, sponsored the Flex Loan law and helped pass it in 2014. This was before he had the top job in the state House. 

This lender said its loans would help Tennesseans. It has sued more than 110,000 of them.

Sexton’s campaign and political action committee have received more than $105,000 from the company, making it one of the largest contributors to him over the past decade. He is also an ally of the company’s owners, fighting in 2021 to protect their gambling company. In 2026, he appointed John Cheadle, Advance’s debt collection lawyer whose firm has sued thousands of Tennesseans, to the Nashville Airport Authority Board. 

Earnest previously told the Lookout that the company has an A+ rating from the Better Business Bureau. He added that the Tennessee Department of Financial Institutions has received just 91 complaints about flexible credit lenders since 2020, representing less than 0.001% of all new flex loan agreements, and that this data reflects the satisfaction of the vast majority of Advance’s customers.