This change is consistent with the standard that the lender make a good faith effort to evaluate a borrower's ability to repay. The alternate interest charge provision in Texas law appears to have been intended to apply to installment loans, not single-payment loans, since it is referred to as an installment account handling charge. Because a customer's account is only set up one time, and because a these loans are single-payment loans, we believe it is inappropriate to allow the installment account handling charge more than one time. We urge you to modify the proposed rule to allow the collection of the fee only once. Additional Disclosure for Consumer Credit Counseling Assistance Payday loan borrowers may require additional assistance in managing their finances.
Evidence points to the fact that payday loans get paid before other debts.
While this is partially explained by the coercive nature of the lender holding the borrower's check, it indicates that a borrower's finances may be beyond his or her control. Such borrowers should be given information, as part of the lender's required disclosure, about how to get assistance in managing their debt. They may be able to work out payment plans and help get your debt under control. Lenders who make these loans should report them separately and perhaps have a unique identifier or endorsement on their license that will allow regulators and the public to know how many lenders are making this unique type of loan. In addition, special record keeping provisions and reporting requirements should be implemented to monitor the volume of these loans and to give auditors a way to be sure that lenders are complying with state regulations, particularly regulations that affect how a loan may be refinanced.