While many states have passed restrictions on payday and auto title lenders, a lack of oversight in Texas has allowed the industry to grow into a $4 billion-a-year machine. The Center for Responsible Lending (CRL) categorizes Texas as a state “without meaningful regulation of payday lending.”
Borrowers in Texas take out payday loans that average $468, compared to $392 nationwide, and pay 439 percent in annual rates compared to 339 percent, the Center for Public Policy Priorities reports. Additionally, last year saw almost 38,000 vehicles repossessed statewide because the owners defaulted on title loans.
Cities such as Dallas, El Paso, Austin, and Houston have passed ordinances to restrict the businesses; but statewide regulations have repeatedly failed. Texas continues to have no limits on fees or loan sizes.