Payday Loan Defense
Attorney in Houston, Texas
Our Trusted Houston Bankruptcy Attorneys
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. 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 what I can do for you? Contact me today to request a free initial consultation.
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:
The amount you would like to 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 financial trajectory.