CS/HB 1425 Summary

• Creates the Access to Responsible Credit Pilot Program within the Office of Financial Regulation to provide consumer finance installment loans of $300-$3,000 with enhanced consumer protections and lower interest rates.

• Sets maximum interest rate at 36 percent (fixed, simple interest) with origination fees capped at 7 percent for first loans ($90 max) and 6 percent for subsequent loans ($75 max), and delinquency charges limited to $14 per late payment.

• Requires program licensees to report borrower payment performance to credit reporting agencies, offer credit education programs, and conduct debt-to-income underwriting with a 50 percent maximum ratio.

• Establishes "referral partners" as authorized intermediaries who can market loans and process applications at their physical locations, with compensation capped at $60 per loan plus $2 per payment received.

• Requires the Office of Financial Regulation to examine licensees at least every 24 months, post annual reports by January 1, 2018, and the entire program sunsets January 1, 2022; effective January 1, 2017.