| |
|
|
A BILL TO BE ENTITLED
|
|
|
AN ACT
|
|
|
relating to the interest and fees that may be charged for certain |
|
|
consumer loans; providing a criminal penalty. |
|
|
BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS: |
|
|
SECTION 1. Subchapter E, Chapter 342, Finance Code, is |
|
|
amended by adding Section 342.200 to read as follows: |
|
|
Sec. 342.200. INTEREST CHARGES; REBATES. (a) |
|
|
Notwithstanding any other provision of this subchapter, Subchapter |
|
|
F, or a rule adopted under this chapter, a loan contract under this |
|
|
chapter that is not secured by real property may not provide for an |
|
|
interest charge for the cash advance that exceeds 36 percent a year, |
|
|
including any fees included in the computation of interest under |
|
|
this chapter or other law. |
|
|
(b) A charge for interest must be computed and paid as a |
|
|
percentage of the unpaid principal balance. For purposes of this |
|
|
subsection, "unpaid principal balance" means the balance that has |
|
|
not been paid, exclusive of any interest, service charges, or other |
|
|
charges related to the loan. |
|
|
(c) An interest rate charged on an overdue balance may not |
|
|
exceed the maximum rate charged before the balance becomes due. |
|
|
SECTION 2. Subchapter H, Chapter 342, Finance Code, is |
|
|
amended by adding Section 342.354 to read as follows: |
|
|
Sec. 342.354. REFUND OF PRECOMPUTED INTEREST: OTHER LOANS. |
|
|
(a) This section applies only to a loan contract to which Section |
|
|
342.351 or 342.352 does not apply. |
|
|
(b) If the contract is prepaid in full, the lender shall |
|
|
refund or credit to the borrower unearned interest charges paid by |
|
|
the borrower, as computed by the actuarial method or another method |
|
|
that is at least as favorable to the borrower. |
|
|
SECTION 3. Subchapter M, Chapter 342, Finance Code, is |
|
|
amended by adding Section 342.606 to read as follows: |
|
|
Sec. 342.606. INTEREST AND FEES FOR DEFERRED PRESENTMENT |
|
|
TRANSACTION. (a) A lender may not charge or receive interest or |
|
|
fees in connection with a deferred presentment transaction other |
|
|
than the interest and fees specifically authorized by this section. |
|
|
(b) A deferred presentment transaction may provide for an |
|
|
administrative fee not to exceed $5 for each transaction. An |
|
|
administrative fee is not included in the computation of interest. |
|
|
(c) If there are insufficient funds to pay a check on the |
|
|
date of presentment, a lender may charge a fee not to exceed the |
|
|
greater of $15 or the amount charged to the lender by the financial |
|
|
institution. Only one fee may be charged under this section for a |
|
|
single check, regardless of whether the check has been deposited |
|
|
and returned more than once. A fee under this subsection is the |
|
|
exclusive authorized charge for late payment. |
|
|
(d) A person who violates this section commits an offense. |
|
|
An offense under this subsection is a state jail felony. |
|
|
SECTION 4. This Act takes effect September 1, 2007. |