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IN SB0245
Bill
Status
1/9/2017
Primary Sponsor
Travis Holdman
Click for details
AI Summary
Senate Bill No. 245 Summary
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Creates a new "long term small loan" product allowing licensed small loan lenders to offer loans with principal amounts between $605 and $2,500 payable over up to 24 months.
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Caps monthly finance charges on long term small loans at 20% of the principal amount, calculated daily using the simple interest method.
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Limits delinquency charges to a maximum of $18.50 per installment if payment is not made within 10 days of the due date, and prohibits lenders from making new long term small loans to a borrower within one day following payment in full.
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Establishes specific requirements including mandatory disclosure notices warning borrowers about loan costs, prohibition on loan renewals, and restrictions on consecutive borrowing (seven-day waiting period after two consecutive long term small loans).
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Amends existing small loan regulations to incorporate long term small loans under the same licensing and regulatory framework, effective July 1, 2017.
Legislative Description
Long term small loans. Provides that a lender that is licensed by the department of financial institutions to engage in small loans may enter into a transaction for a long term small loan with a borrower. Defines a long term small loan as a loan that: (1) is entered into by a licensed small loan lender and a borrower; (2) has a principal amount of at least $605 and not more than $2,500; and (3) is payable in installments over a term of not more than 24 months. Provides that with respect to a long term small loan, a lender
Last Action
First reading: referred to Committee on Insurance and Financial Institutions
1/9/2017