SB231 Summary

• Regulates "consumer lawsuit lending" - the provision of money or credit to consumers where repayment is conditioned on recovery in a dispute or where the lender's recourse is limited to the dispute recovery amount.

• Defines consumer lawsuit lenders as "creditors" under Alabama's Mini-Code and treats each money/credit provision as a consumer loan subject to finance charge limitations of $15 per $100 per year on the first $750 and $10 per $100 per year on amounts between $750-$2,000.

• Declares any amount paid to a consumer lawsuit lender exceeding the actual money/credit provided to be a finance charge, regardless of how the transaction is structured.

• Requires all documents provided by the consumer to the lender and a copy of the lending agreement to be filed with the court and served on the opposing party in any related dispute without awaiting a discovery request.

• Deeems any provision of a consumer lawsuit lending agreement that does not comply with bill requirements to be unconscionable; becomes effective the first day of the third month following passage, with licensing deadline of September 30, 2014.