By: Truitt, Rodriguez, Harless, Farias, H.B. No. 2592
      McClendon, et al.
 
 
A BILL TO BE ENTITLED
 
AN ACT
  relating to notice and disclosure requirements for certain credit
  services organizations regarding charges and consumer borrowing.
         BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
         SECTION 1.  Chapter 393, Finance Code, is amended by adding
  Subchapter C-1 to read as follows:
  SUBCHAPTER C-1.  NOTICE AND DISCLOSURE REQUIREMENTS FOR CERTAIN
  CREDIT SERVICES ORGANIZATIONS
         Sec. 393.221.  DEFINITIONS. In this subchapter:
               (1)  "Credit access business" means a credit services
  organization that obtains for a consumer or assists a consumer in
  obtaining an extension of consumer credit in the form of a deferred
  presentment transaction or a motor vehicle certificate of title
  loan.
               (2)  "Deferred presentment transaction" has the
  meaning assigned by Section 341.001. The term is also referred to
  as a payday loan.
               (3)  "Motor vehicle certificate of title loan" or "auto
  title loan" means a loan in which an unencumbered motor vehicle is
  given as security for the loan. The term does not include a retail
  installment transaction under Chapter 348 or another loan made to
  finance the purchase of a motor vehicle.
         Sec. 393.222.  POSTING OF FEE SCHEDULE; NOTICES. (a) A
  credit access business shall post, in a conspicuous location in an
  area of the business accessible to consumers and on any Internet
  website, including a social media site, maintained by the credit
  access business:
               (1)  a schedule of all fees to be charged for services
  performed by the credit access business in connection with deferred
  presentment transactions and motor vehicle certificate of title
  loans, as applicable;
               (2)  a notice of the name and address of the Office of
  Consumer Credit Commissioner and the telephone number of the
  office's consumer helpline; and
               (3)  a notice that reads as follows:
         "An advance of money obtained through a payday loan or auto
  title loan is not intended to meet long-term financial needs. A
  payday loan or auto title loan should only be used to meet immediate
  short-term cash needs. Refinancing the loan rather than paying the
  debt in full when due will require the payment of additional
  charges."
         (b)  The Finance Commission of Texas may adopt rules to
  implement this section.
         Sec. 393.223.  CONSUMER TRANSACTION INFORMATION. (a)
  Before performing services described by Section 393.221(1), a
  credit access business must provide to a consumer a disclosure
  adopted by rule of the Finance Commission of Texas that discloses
  the interest, fees, and annual percentage rates, as applicable, to
  be charged on a deferred presentment transaction or on a motor
  vehicle certificate of title loan, as applicable.
         (b)  If a credit access business obtains or assists a
  consumer in obtaining a motor vehicle certificate of title loan,
  the credit access business shall provide to the consumer a notice
  warning the consumer that in the event of default the consumer may
  be required to surrender possession of the motor vehicle to the
  lender or other person to satisfy the consumer's outstanding
  obligations under the loan.
         (c)  The Finance Commission of Texas shall adopt rules to
  implement this section.
         Sec. 393.224.  ADMINISTRATIVE PENALTY. The consumer credit
  commissioner, in accordance with rules adopted by the Finance
  Commission of Texas, may assess an administrative penalty against a
  credit access business that knowingly and wilfully violates this
  subchapter or a rule adopted under this subchapter in the manner
  provided by Subchapter F, Chapter 14.
         SECTION 2.  This Act takes effect January 1, 2012.