Texas CAB – Texas CSO- Texas 3rd Party Lender
Texas Credit Access Businesses obtain credit for a consumer from an independent third-party lender in the form of a deferred presentment transaction or a motor vehicle title loan, more commonly referred to as “payday loans” or “title loans.”
In Texas, the actual third-party lender is not licensed, rather the credit access business that serves as the broker is the licensee in this regulated industry. The credit access business charges a fee to the consumer for obtaining the third-party loan; this fee is usually calculated as a percentage of the loan amount.
Third-party lenders typically earn an initial 10% interest and often participate in consumer NSF and late fees; 12% – 14% APR’s are not uncommon.
The borrower will sign a promissory note with the lender for the actual loan and a separate credit service agreement with the credit access business. Generally, all documents are signed at the credit access business location and payments are made directly to the credit access business.
For more Texas CAB – CSO – Third Party Lender informaion: Texas CAB