HB 2547 Summary

• Establishes a pilot program within the Division of Financial Institutions to increase availability of small dollar loans ranging from $300 to less than $2,500

• Sets maximum interest rates at the lesser of 36% or prime rate plus 32.75% for loans up to $1,000, and 35% or prime rate plus 28.75% for loans above $1,000

• Limits administrative fees to 7% of principal or $90 (whichever is less) for first loans and 6% or $75 (whichever is less) for subsequent loans, with maximum one fee per four-month period

• Requires licensees to underwrite loans based on borrower's ability to repay with total monthly debt service not exceeding 50% of gross monthly income, and to report payment performance to consumer reporting agencies

• Permits use of "finders" to bring lenders and borrowers together, compensated at $40-$45 per consummated loan with specific restrictions on their activities; pilot program expires June 30, 2021