Legal Question in Credit and Debt Law in Texas

Pay Day Loans

I got a question about these payday loan places. They have you draw a check postdated till you get paid. You recieve less than the face falue of the check. Now comes payday and you can't cover the check so you write another check and the process continues.Now if you do nothing the check is processed and you have a nsf checkon your hands. My question is this. Can the pay day loan company now use the county attorney to collect this check using the crimminal justice system?


Asked on 6/27/05, 5:55 pm

1 Answer from Attorneys
Dinesh Singhal Singhal & Associates

Re: Pay Day Loans

Generally speaking, your intent at the time of writing a post dated check (or check for any date) is the key to any criminal prosecution. If they can show that you wrote a check fully knowing that you did not have monies to cover it and/or will not have monies to cover it on the check date, then they can make a complaint with the DA's office. But if you wrote the check intending to honor it but later circumstances made it hard to honor it, then it is generally a breach of contract claim i.e. a civil claim in a lawsuit. Nothing more.

This is ofcourse a general rule, and specific intent and facts may render a different result. Some one writing multiple checks over a period time and not honoring them may be taken as an intent to not honor them.

Dinesh Singhal

713-222-8500

Licensed in Texas, California, & New York

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Answered on 6/28/05, 9:01 am


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