Payday loans can really be a financial trap for a lot of regular people. I had a client come in recently that had 10 of them at one time! He didn't mean to take on 10, but he took on one, and then could not keep up with it. So he borrowed another, and another, and another. When you get in that deep, it is like quicksand.

And they charge interest rates of 100% or more. This would be illegal in the state of Texas, except payday lenders are allowed to call themselves "credit services organizations" and essentially use national banks to do the actual lending, which are exempt from state "usury" laws. Then the payday lender charges you a fee, supposedly for "arranging" the loan.

Anyway, as you can tell, I am against payday loans, as most consumer lawyers are. They are just too expensive, and it is too easy to get in trouble with them by deciding to renew them, instead of paying them off. There is some good information about payday loans on the website of the Federal Trade Commission.

If you are in trouble or delinquent with payday loans, they can be discharged or cancelled in bankruptcy, like other debts. Call the office for an appointment at 713-772-8037, or request one of our publications.

J Thomas Black
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Board Certified, Consumer Bankruptcy Law- Texas Board of Legal Specialization
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