Trapped in a Payday Loan Cycle?
Our Trusted Houston Bankruptcy Attorneys Can Help
Texas is one of only 37 states in the U.S. that allows payday loans. These
short-term loans are marketed to individuals who, in theory, need to cover
an unexpected expense before their next payday. The truth is, however,
is that many of these loans are predatory and enforce alarmingly high
interest rates and other fees that trap borrowers in debts and loan cycles
that they cannot afford. Many of these payday loan companies even file
criminal complaints against borrowers who cannot pay.
If you are in overwhelming payday loan debt and do not know where to turn,
we invite you to contact us at
Payne & Associates, PC. We have helped provide financial solutions to countless individuals and
families who needed an advocate by their side. With more than 15 years
of combined experience, our dedicated
Houston bankruptcy lawyers know how to assess your circumstances and can make recommendations with
the goal of preventing any undue hardship or penalties.
Want to learn more about we can do for you? Contact us today to request
a free initial consultation. Our team is standing by.
The Payday Loan Cycle
Because payday loans are supposedly short-term loans, payday loan companies
can get away with applying high annual interest rates—many higher
than 1000%. When borrowers can't pay, they often renew the loan, which
makes them vulnerable to crippling financing fees and traps them in a
"cycle" of non-payment and re-borrowing. The Center for Responsible
Lending conducted a study that revealed that 76% of payday loans were
taken within two weeks of another loan.
What do payday loan numbers typically look like? Here's an example:
- Amount you would like borrow: $300
- Initial lender fee: $60
- Renewal fee (after two weeks): $60
- Total monthly renewal charges: $120
- Total annual renewal charges: $1,560
- Approximate APR: 520%
If you are defaulting on your payday loans, you are not alone: it's
estimated that nearly half the people who take them out find that they
cannot pay them back. The good news is many of these companies are considered
unsecured creditors—meaning that, during a bankruptcy filing, their
loans can be wiped out. Our Houston bankruptcy attorney can help you navigate
this process, end the threat of legal action, and put you back on a healthy
A brighter future can be possible.
Call our team today to start considering your bankruptcy options.