Texas usury law and small claims court

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Latest post Fri, Feb 9 2007 6:11 PM by Fxston. 4 replies.
  • Fri, Feb 9 2007 3:44 PM

    • chadnutz
    • Not Ranked
    • Joined on Thu, Jan 11 2007
    • Posts 5

    Question [=?] Texas usury law and small claims court

    Hey guys,

    I posted a question on here and got some good advice, and now I'm back for more.

    First, the story. Neighbor calls up, asks to borrow money, and offers to repay the amount in two weeks plus 60% extra (buying business, getting SB and minority loans which come through on the sale, hitting it big, yada yada yada). Like a retard, I agree. Now its drug on and it doesn't seem like he's going to pay.

    Now the question. I have, in writing, the original agreement. I'd like to sue for just the amount he borrowed (no interest, no fees, just what I'm out). Do the Texas usury laws potentially render my agreement null and void where I couldn't sue even if I wanted to?

    For the lawyers around here, how much would I expect to pay to call and get legal advice?
  • Fri, Feb 9 2007 4:21 PM In reply to

    re: Texas usury law and small claims court

    "Do the Texas usury laws potentially render my agreement null and void where I couldn't sue even if I wanted to?"

    You can *always* sue. I don't know what Texas law is as to private party personal loans vs. commercial loans, or what $$$$ penalty there is to suffer. That said, not sure why you bought his argument in the first place. Why would he need the money for only two weeks if there was a SBA/legitimate loan that was about to close within that short timeframe?

    Have no idea. Usury laws aren't black and white. You'd have to talk with a local civil litigation attorney.

    "For the lawyers around here, how much would I expect to pay to call and get legal advice?"

    You need to make some calls; we can't guess at what it would cost from here.




  • Fri, Feb 9 2007 5:50 PM In reply to

    • chadnutz
    • Not Ranked
    • Joined on Thu, Jan 11 2007
    • Posts 5

    re: Texas usury law and small claims court

    "That said, not sure why you bought his argument in the first place. Why would he need the money for only two weeks if there was a SBA/legitimate loan that was about to close within that short timeframe?"

    First and foremost, I guess because I'm an idiot. I didn't do it to make money, I was just trying to help the guy out. The money was to cover expenses from his "attorney" or "accountant" until the purchase was finalized. To his credit, he was talking about it (read: setting me up) for a couple months before he asked me.

    As far as finding a lawyer, I don't really have an idea how to search. Thanks for pointing me toward "civil litigation". I have called a couple of attorneys to ask about the usury question, but they just reply with "Bring me a grand and we'll sue his ass!" I'll happily pay for the legal advice, but I'd rather go to small claims court on my own. I'm already out some money, I'd rather not be out another grand from an attorney that doesn't know the usury laws to begin with.
  • Fri, Feb 9 2007 6:11 PM In reply to

    re: Texas usury law and small claims court

    I'd just be calling attorneys to say that I wanted to pay for an hour of their time (or perhaps a paralegal's) to do research on the usury angle and that's it.

    Your state may not even allow attorneys in small claims anyway.
  • Sat, Feb 10 2007 5:02 PM In reply to

    re: Texas usury law and small claims court

    TX small claims limit is 5000. So if the loan was up to 5000 you can sue in small claims court.

    If it was me, I'd sue for the amount of the agreement plus the agreed upon interest. I wouldn't be too concerned about spending money on getting research and legal advice because the judge will end up telling you what you can and cannot get.

    Like any contract, having a problem with only part of the contract, very often doesn't nullify the whole thing.

    Basically, I think you would be awarded the amount of the loan plus whatever interest level the judge decides is appropriat.

    But that's just what I think.

    You've got nothing to lose but a little time and your filing and process service fees.
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