Texas lawmakers propose SB 253 and HB 410 to limit payday loans

In Texas, there are more than 3,500 personal loan companies. Two new pieces of legislation – Texas SB 253 and Texas HB 410 – have been introduced as a way to limit this short-term lending. The two pieces of legislation make an effort to re-define “credit service organization”. Article resource – Texas lawmakers propose SB 253 and HB 410 to limit payday loans by MoneyBlogNewz.

What you need to learn about the exemption for the Credit Service Organization

Consumer credit and financial institutions are very limited in TX. ”Credit Service Organization” is what Payday advance stores are under right now. This is because cash advance stores offer a form of short-term credit that is available to those without a credit history or with a bad credit history. The exemption does not make note of any differences between check cashing services and pay day loans. Check cashing is for those who do not have banks while payday loans are for everyone who does not have the right credit available.

What will take place with the Texas payday advance legislation?

”Credit Service Organization” is re-defined within the TX legislature with 2 bills that were introduced while payday advance stores are excluded. The fees charged based on annual percentage rate would be very limited. Of all the payday loan stores in Texas, about 3,000 to 6,000 of the 7,800 employees would be losing jobs as outlined by industry estimates. Credit is harder to get for consumers then. That is another thing that payday loan stores and consumers would have to face.

Willing to recognize some kinds of regulation

Additional regulation and oversight is welcomed by Texas payday advance stores and loan providers even though they have shown they are against TX SB 253 and HB 410. There is something very distinct about the short-term credit that is available through payday advances. Charge cards, credit unions and banks typically cannot afford to give this kind of credit to many. A service is all the cash advance industry is providing. It is needed by some. The concern is mostly over interest rates from lawmakers. The interest is less than a credit card cash advance would end up leaving you with though.

Articles cited

Texas State

legis.state.tx.us/tlodocs/82R/billtext/pdf/SB00253I.pdf#navpanes=0

Texas HB

www.legis.state.tx.us/tlodocs/82R/billtext/pdf/HB00410I.pdf#navpanes=0

KXAN

kxan.com/dpp/news/politics/state-looks-to-curb-payday-loans

Personal Money Store

personalmoneystore.com/payday-lending-statistics/