NACOGDOCHES, TX (KTRE) - Payday lending is a topic the Nacogdoches City Council wants to stay on top of, yet it falls short of falling in line with cities that have passed ordinances regulating the industry.
The Nacogdoches city attorney told East Texas News recommendation about payday lending is for the time being awareness over regulation.
The watch over payday lending stores is assigned to Nacogdoches City Attorney Rob Atherton.
"Quite frankly, I think most people think it victimizes the most vulnerable members of the community," Atherton said.
The powerful payday loan lobbyists defend the industry for being the lenders of the last resort for borrowers who can't get money at conventional banks. Perhaps true, but it comes with a price.
By random selection, an application for $550 would cost the borrower over $137 in fees if it was paid back in two weeks. If it's renewed as occurs in most cases the fees quickly add up.
"In two and a half months, you owe $1,262 and are pretty much helplessly in debt," Atherton said.
The state continues to debate the unregulated industry. Failure to take action prompted 34 Texas cities to take the bold step in passing their own ordinances regulating the practice. What happened next was to be expected.
"A number of them have actually been sued by the very lucrative payday loan industry," Atherton said.
The lawsuits are on appeal. Meanwhile, the regulations appear to be working. In Dallas, the number of payday lenders has declined.
The number increases in unregulated places like Nacogdoches.
Atherton will make his presentation to the Nacogdoches City Council Tuesday night.