NevadaвЂ™s greatest court has ruled that payday lenders canвЂ™t sue borrowers whom just simply simply take away and default on secondary loans used to spend the balance off on a short high-interest loan.
The Nevada Supreme Court ruled in a 6-1 opinion in December that high interest lenders canвЂ™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 really a victory for low-income people and can help alleviate problems with them from getting caught regarding the вЂњdebt treadmill machine,вЂќ where people sign up for extra loans to repay an loan that is initial are then caught in a cycle of financial obligation, that may frequently induce legal actions and finally wage garnishment вЂ” a court mandated cut of wages planning to interest or major payments on that loan.
вЂњThis is a great result for consumers,вЂќ said Tennille Pereira, a customer litigation lawyer because of the Legal Aid Center of Southern Nevada. вЂњIt’s a very important factor to be in the financial obligation treadmill machine, it is one more thing become from the garnishment treadmill machine.вЂќ