HB 5589 Summary

• Increases the maximum allowable monthly interest rate on pawn loans from 3% to 4% per month, plus storage charges.

• Requires pawnbrokers to deliver a consecutively numbered memorandum or note to borrowers at the time of the loan, with no charge for providing this document.

• Mandates that pawnbrokers print specific consumer protection language on the back of loan memoranda in English 12-point type, informing borrowers that loans are void if interest exceeds 4% monthly plus storage charges.

• Clarifies that if excessive interest or charges are imposed, the borrower cannot be required to repay the loan or any interest/charges, and the pawnbroker forfeits all rights to the pledged items.

• Includes a tie-bar provision making the bill's effectiveness contingent upon the enactment of Senate Bill 369 of the 100th Legislature.