Mechanics of Payday Loans in Texas

Just like the other states, there's availability of payday loans in Texas when he or she needs some emergency cash to settle obligations that have to be paid in a hurry. These kinds of loans however are strictly regulated in Texas - there are set limits and loan terms that the borrower must be aware of in advance. State laws are strict in the setting of the amount limits that a borrower can avail of, thus avoiding situations where lenders can no longer collect the debts because of over-borrowing on the part of some careless borrowers.

Payday Loan Term Limit is not more than 31 Days

Cash advance loans come in handy when one is in a tight pinch in Texas, but then the borrower is also obliged to be sure that the amount he borrows is within his capacity to pay, and within the term limit set - no more than 31 days in this state. There are variations in term limits of different lenders, but the 31 day limit is always observed. Cash advance payday loans in Texas thus have a maximum loan term of 31 days. There are shorter loan limits too - seven to fourteen days are common.

You Can Only Borrow a Quick Loan of not More than $500

Texas payday loans are in the small loan category, and the state's laws typically dictate the maximum amount of money that can be borrowed, which is $500, in the aggregate. As of now in Texas, there is no limit to the number of loans one can get, but altogether, they cannot total more than the $500 maximum specified by law.

Rates and Fees of Cash Loans Vary

Cash advance/payday loans in Texas are no different from the other types of loans. Rates and fees will vary depending on where you go to borrow the money that you need. There are limits however specified by law though to the amount that you can be charged in interest and loan fees. Texas lenders cannot charge more than $10 per loan and 48 percent annual interest on cash advance and/or payday loans. Another limit that the laws specify is in the financial charges that can be applied to a loan. As of now current Texas laws stipulate a maximum of $12 on a 14-day $100 payday loan.

Lenders in the business of offering loans to needy borrowers can indeed make a profit - but at the same time borrowers are protected by Texas laws from being exploited by unscrupulous lenders.