By: Ellis S.B. No. 1781
A BILL TO BE ENTITLED
AN ACT
1-1 relating to delinquency charges in retail charge agreements.
1-2 BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
1-3 SECTION 1. Subsection (c), Section (6), Article 6.03, Title
1-4 79, Revised Statutes (Article 5069-6.03, Vernon's Texas Civil
1-5 Statutes), is amended to read as follows:
1-6 (c) The time price differential in a retail charge agreement
1-7 resulting from the computation under this Section shall be computed
1-8 utilizing the average daily balance method. A minimum time price
1-9 differential not in excess of 75 cents per month may be charged,
1-10 received, and collected for any billing cycle in which a balance is
1-11 due. Under this Section, a retail charge agreement may provide for
1-12 a delinquency charge on each installment in default for a period of
1-13 more than 35 [21] days in an amount not to exceed $20 [$10]. Only
1-14 one such delinquency charge may be collected on any installment
1-15 regardless of the period during which it remains in default. In
1-16 addition, such retail charge agreement may provide for the payment
1-17 of an attorney's reasonable fee when it is referred for collection
1-18 to an attorney who is not a salaried employee of the holder of the
1-19 contract and for court costs and disbursements. The creditor shall
1-20 remit 50 cents from each delinquency charge collected under this
1-21 Section to the comptroller, in the time and manner established by
1-22 the comptroller, for deposit to the credit of an account in the
1-23 general revenue fund. One-half of the money deposited in the
1-24 account may be used only to finance research conducted by the
2-1 Finance Commission of Texas under Section 1.011(f), Texas Banking
2-2 Act (Article 342-1.011, Vernon's Texas Civil Statutes). The other
2-3 one-half of the money deposited in the account may be used only to
2-4 finance educational activities and counseling services under
2-5 Articles 2.02A and 9.01, Title 79, Revised Statutes (Articles
2-6 5069-2.02A and 5069-9.01, Vernon's Texas Civil Statutes). If the
2-7 Consumer Credit Commissioner determines that any seller that was
2-8 operating under this Chapter on September 1, 1997, has after that
2-9 date moved its credit operations out of this state in a manner that
2-10 results in the seller's retail installment contracts not being
2-11 subject to this Chapter, the Consumer Credit Commissioner shall
2-12 notify the Finance Commission of Texas and the Finance Commission
2-13 shall by rule reduce the maximum delinquency charge that may be
2-14 collected under this subsection to $10.
2-15 SECTION 2. The importance of this legislation and the
2-16 crowded condition of the calendars in both houses create an
2-17 emergency and an imperative public necessity that the
2-18 constitutional rule requiring bills to be read on three several
2-19 days in each house be suspended, and this rule is hereby suspended,
2-20 and that this Act take effect and be in force from and after its
2-21 passage, and it is so enacted.
2-22 COMMITTEE AMENDMENT NO. 1
2-23 Amend S.B. No. 1781 in SECTION 1 of the bill by striking the
2-24 underlined language beginning on page 1, line 19, and ending on
2-25 page 2, line 15 (Senate engrossment), and substituting the
2-26 following:
2-27 (ii) The Consumer Credit Commissioner may
3-1 accept financial contributions from a seller or a creditor
3-2 operating under this Chapter who collects a delinquency charge in
3-3 excess of $10 for the purpose of research conducted by the Finance
3-4 Commission of Texas under Section 1.011(f), Texas Banking Act
3-5 (Article 342-1.011, Vernon's Texas Civil Statutes) and to fulfill
3-6 responsibilities of developing consumer education programs and
3-7 voluntary counseling services under Articles 2.02A and 9.01, Title
3-8 79, Revised Statutes (Article 5069-1.01 et seq., Vernon's Texas
3-9 Civil Statutes).
3-10 (iii) A creditor operating under this
3-11 chapter who collects a delinquency charge in excess of $10 shall
3-12 provide financial support to private credit counseling
3-13 institutions.
3-14 (vi) If the Consumer Credit Commissioner
3-15 determines that any seller or creditor that was operating under
3-16 this Chapter on September 1, 1997, and that has charged a
3-17 delinquency charge in excess of $10, has after that date moved its
3-18 credit operations out of this state in a manner that results in the
3-19 seller's retail installment contracts not being subject to this
3-20 Chapter, the Consumer Credit Commissioner shall collect from the
3-21 creditor an amount equal to 25 cents for each delinquency charge
3-22 collected during the 12-month period preceding the date of the
3-23 move.
3-24 Elkins
3-25 COMMITTEE AMENDMENT NO. 2
3-26 Amend S.B. No. 1781 in SECTION 1 of the bill by striking the
3-27 underlined language on page 1, line 13 (Senate engrossment), and
4-1 substituting the following:
4-2 more than 21 days in an amount not to exceed $20 [$10]. Only
4-3 Marchant