This article was written by the Consumers Union Southwest Regional Office . The Office of the Attorney General and the Office of the Consumer Credit Commissioner must step up enforcement against companies making these kinds of loans. Usury is already illegal in Texas, but without enforcement these practices will proliferate. Make it illegal to use or threaten hot check collection for payday loans Payday loan lenders use the state's criminal justice system as a collection agency when borrowers cannot repay these high cost loans.
Lenders take a personal check from a borrower as collateral on the loans.
The mere threat that a lender will pursue criminal hot check collection is enough to make borrowers find some way to repay or renew loans. The Legislature should make it illegal for lenders to pursue or threaten to pursue hot check collection against borrowers on these kinds of loans.