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If you live in the great state of Texas then you may be interested in knowing that your state is known for more than just big sky, and great barbecue. It's also known for having some of the loosest payday lending laws of all the states in the entire US. Coincidentally it's also unique in another way. That is that it also has the highest number of payday loan borrowers of any state in the entire US.
So it should come as no surprise that lawmakers have recently been focused on instituting a number of changes in the way these businesses operate within their borders. Changes in laws that may affect you the next time you go to secure loan from a payday lending franchise. Now it's important keep in mind here that these new laws that were enacted effect not just community-based lenders but also those that operate over the Internet as well.
For instance one of the recently enacted laws stipulates you may not borrow any more than 35% of your monthly income at any one time. Now keep in mind that this is your income after taxes and deductions have been taken out of your check. Now this might not seem like a big change until you do the math and realize that in order for you to borrow $1000 from a payday lender in Texas you'll have to be bringing home roughly $750 after wage deductions.
Then one more new change in Texas laws makes it a crime for a payday lender to threaten you with criminal prosecution if you default a loan. Now make no mistake here though. If you have committed a crime such as submitting falsified documents during the application process you can, and most likely will still be prosecuted. The new law simply prevents you from being threatened with impending prosecution.
The new laws passed also put a cap on the interest that can be charged by a paycheck cash advance lender. You see, all along these types of loan franchises were pretty much unregulated. And all it took was a $100 license fee for someone the open one in there. These new laws however, now put these lending franchise operators under the same regulatory umbrella that covers banks and credit unions.
Now this report only covers a few of the changes that at taken place, so you may want to do your own research if you're interested more in depth details on them. There are other laws that affect these types of credit providers that were enacted. Also another thing worth knowing here is that in comparison to other states in the US, fast cash payday lenders in Texas still operate under some the more lenient regulations.
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Article Added on Wednesday, July 18, 2012
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