How Many Payday Loans Can You Have In Texas
Last updated on October 14th, 2023 at 12:13 am
Hey, I’m Randy. I live in the US where I work with a team with Ready Payday Loans.
How many payday loans can you have in Texas? This is a question that many people ask. Payday loans are a popular option for many borrowers in Texas who need quick access to cash. These short-term loans are due on the borrower’s next payday. They cover unexpected expenses or bridge the gap between paychecks. Payday loans are a convenient way to access quick cash. But they often come with high-interest rates and fees. This can trap borrowers in a cycle of debt.
Getting a payday loan is simple. The borrower writes a postdated check for the loan amount plus fees. They can also give the lender access to their bank account for an electronic withdrawal. The lender then provides the borrower with cash or transfers the funds to their account. When the loan is due, the borrower can either repay the loan in full or roll it over for another fee.
Who Is The Regulator And How Many Payday Loans Can You Have In Texas?
In Texas, the Texas Office of Consumer Credit Commissioner (OCCC) regulates payday lending. The OCCC licenses and regulates payday lenders in the state. It enforces Texas payday lending laws.
The statute of limitations on payday loans is 4 years. This means that if you default, the lender has 4 years to sue you for the balance. If they don’t start a lawsuit within this period, they can’t sue you at all. Unfortunately, lenders rarely let the statute of limitations expire.
Under Texas law, payday lenders can charge up to 10% of the loan amount as an origination fee. Besides, lenders can charge interest rates of up to 662% for a two-week loan term, according to the OCCC. This means that if a borrower takes out a $500 payday loan in Texas, they could end up paying back over $1,500. This can be over the course of a year, including fees and interest.
A greater rate of interest than 10 percent a year is usurious unless otherwise provided by law. All contracts for usurious interest are contrary to public policy.
How Much Are Texas Payday Loan Interest Rates?
One of the biggest criticisms of payday loans is their high-interest rates and fees. The average payday loan carries an APR of 400%. This is according to the Consumer Financial Protection Bureau (CFPB). Texans paid over $1.6 billion in payday and auto title loan fees in 2017. This figure represents a significant burden on low-income Texans.
Besides the high-interest rates, payday loans also come with fees that can add up quickly. These fees may include an origination fee. Lenders charge an origination fee when the loan is first taken out. The fees can also include late fees and rollover fees. Some lenders may also need borrowers to buy insurance or other add-ons. This can increase the cost of the loan even further.
Despite these risks, payday loans continue to be a popular option for many Texans. Especially those who need quick access to cash. In fact, according to the OCCC, over 1.8 million payday loans were taken out in Texas in 2020. According to the CFPB, 12 million Americans use payday loans each year. But, there are alternatives to payday loans that may be a better fit for some borrowers.
Are Texas Online Payday Loans Secure?
While payday loans can be a quick and easy way to access cash, they are not without risks. For one, borrowers who cannot repay the loan on time may be subject to more fees and charges. They’re also vulnerable to damage to their credit score. Sometimes, lenders may even take legal action to recover the amount owed.
Payday loans in Texas can be a slippery slope to a cycle of debt. This is because the loans are due on the borrower’s next payday. Many borrowers find themselves unable to repay the loan in full and must roll it over for another fee. This can lead to a cycle of debt where borrowers are taking out new loans to cover the old ones.
How Many Payday Loans Can You Take Out In Texas?
So how many payday loans can you have in Texas? For example, in Washington state, you can have up to 8 payday loans at once. In Texas, there is a unified payday order that allows only 4 installments and 3 rollovers. Your best option is to check your state’s payday lending laws or ask your lender. In the state payday lenders should not provide more than one payday loan at a time.
While it may be possible to get many payday loans or even two payday loans at once if the payday lender doesn’t check. It can make it harder to pay back, and you’ll face high fees. Some states have no loan limits. In Texas, for example, there is no legal limit to the amount a payday lender can loan you. So if you already have a $500 loan, the same lender or any other lender can give you another $500 loan.
Alternatives To Payday Loans Online
But, there are alternatives to payday loans that may be a better fit for some borrowers. One option is to consider a personal loan from a bank or credit union. Personal loans have lower interest rates and fees than payday loans. Borrowers can repay these loans over a longer time. They may qualify for a larger loan amount with a personal loan. This can help them cover larger expenses.
Another option is to look into a cash advance on a credit card. Cash advances can also be expensive. The good thing is they may come with lower interest rates and fees than payday loans. Borrowers should be sure to read the terms and conditions of their credit card agreement. This should be before taking out a cash advance. As a borrower, do this as some credit cards may have higher fees and interest rates than others.
Final Thoughts On How Many Payday Loans You Can Have In Texas
In conclusion, payday loans are a popular option for many borrowers in Texas. You can have one payday loan at a time for those who need quick access to cash. But, they often come with high-interest rates and fees that can trap borrowers in a cycle of debt.
Before taking out a payday loan, borrowers should consider the costs involved. Texas citizens should also explore alternative options if possible. The OCCC provides a database of licensed lenders in Texas. This database is a helpful resource for borrowers who are considering a payday loan. Please quickly browse our website and look through our lending options. To give you a quick look, I have included below some of our loan products:
Until next time.
Randy!
