Supreme Court guidelines Nevada payday loan providers can not sue borrowers on 2nd loans

Supreme Court guidelines Nevada payday loan providers can not sue borrowers on 2nd loans

Nevada’s highest court has ruled that payday lenders can’t sue borrowers whom just just take out and default on additional loans utilized to spend the balance off on a preliminary high-interest loan.

The Nevada Supreme Court ruled in a 6-1 opinion in December that high interest lenders can’t file civil lawsuits against borrowers who take out a second loan to pay off a defaulted initial, high-interest loan in a reversal from a state District Court decision.

Advocates stated the ruling is just a victory for low-income people and certainly will assist in preventing them from getting caught regarding the “debt treadmill machine,” where people sign up for extra loans to repay a loan that is initial are then caught in a period of financial obligation, which could usually result in legal actions and in the end wage garnishment — a court mandated cut of wages planning to interest or major payments on that loan. Continue reading “Supreme Court guidelines Nevada payday loan providers can not sue borrowers on 2nd loans”