Payday loan rules in Austin Texas Payday Advance Credit ™ USA
In the past few years, the number of unsecured personal loans being provided by the banks has considerably reduced. While obtaining a personal loan from the bank might be challenging, those looking for some immediate financing can take out payday loans. These loan types have very loose requirements and can be used for a vast variety of purposes. The laws governing these loans vary from one state to the other. .
One of the regulations in the state of Texas is that the borrower must be made aware of the risks associated with payday lending. The lender has to clearly explain to the borrower the involved costs, the interest rates, and how can the interest rates accumulate over a certain time period. This helps in ensuring that the borrower knows everything about the loans and is not surprised by any charges.
Another limit applicable in the state is related to the amount of money that can be taken as the loan. In certain states this amount has no cap. While most lenders refrain from giving very large loan amounts, in the state of Texas the loan amount cannot exceed $1800. This law also prevent the borrowers from taking multiple loans if the sum total of all the loans is above $1800. The Texas Constitution says that the annual interest rates cannot be above 10%. However, when the payday lenders register their business as a credit service organization they can charge higher rate of interests up to 500%.
Another regulation states that the lender does not have any criminal rights in case the borrower defaults on the repayment. In certain states defaulting on your loan repayments purposely can be considered as a criminal act. In Austin, Texas if you default on your loan, you cannot be charged through criminal proceedings. Although you can be charged in a civil court which means that the payday loan lender can secure a judgement against you and even force you into bankruptcy.
In order to become eligible for a payday loan you must have an active checking bank account. Having a bank account makes it easier for the lender to deposit the money into and receive the repayment with the post-dated cheque. You must possess a valid proof of your income. You would have to provide the current details of your employer or your disability benefits. Also you must have a working phone number. In order to apply for a payday loan you must not be a serving member of the military. The United States Military prohibits all its service members from utilizing any quick loan services. Your credit score will be inconsequential and most lenders would not even bother to check it.
Also the borrower must repay the loan in full by their next pay date; this amount includes the complete loan amount along with the interest. If a loan is not paid in full then the borrower may be liable to pay penalties and fines. Each lender has their terms and conditions and interest rates it is important that you carefully review the rates of each and every lender before accepting the loan.