Defaulted PayDay Loan

QUESTION: Can I be sued in the Texas for a defaulted online payday loan?

I taken out a few payday loans online and pretty much got in over my head paying them back ! Can I be sued in Texas?

ANSWER: Most payday lenders do not sue in Texas. Having said that, they are certainly entitled to sue you if you defaulted on a loan.

I would be curious to know who is threatening the lawsuit and whether they are a “usual suspect” – – the kind of payday lender that actually does file suit in Texas. If they are not customarily in court, then their threat is illegal, and possibly a violation of either the Texas Debt Collection Act and/or the Federal Fair Debt Collection Practices Act. The collection industry for payday lenders is infamous for being abusive. I would suggest you keep track of all collection phone calls and keep all of the collection letters.

If the threat to sue is in writing, I would suggest you forward a copy to a consumer rights attorney. If the threat to sue is made verbally, you might still want to talk to an experienced consumer rights attorney who can do a bit of research and find out whether this collector is blowing smoke, or not.

Finally, you might want to have a look at your credit bureau reports through (That is where you can get your credit reports for free.)

This information is provided for educational purposes only. There is no attorney-client relationship with Karni Law Firm until a contract is signed by the attorney and the client.


Have you fallen behind on that pay day loan?

Now they are calling you saying that you wrote them a “HOT” check, that you will be arrested.

WRONG! This is a common collection technique used by the payday loan’s collectors. The vast majority of consumers who have taken out payday loans have every intention of repaying them. Chances are that you did not write a hot check. At the time that you wrote the check, the Pay Day Loan Company knew you did not have money in your account. If you did, you would not be there taking out a loan in the first place.

They are also threatening to sue you?

TRUE! In the State of Texas, payday lenders can, by law, sue you on the amount owed. BUT, it is very unlikely and this rarely happens outside of credit card and auto deficiency debt. Plus, you may have defenses available to you. [If you do get sued, you can visit to find an attorney.]