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A BILL TO BE ENTITLED
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AN ACT
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relating to regulation of certain credit services organizations. |
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BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS: |
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SECTION 1. Section 393.221(1), Finance Code, is amended to |
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read as follows: |
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(1) "Credit access business" means a credit services |
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organization that obtains for a consumer or assists a consumer in |
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obtaining an extension of consumer credit, including an extension |
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of consumer credit in the form of a deferred presentment |
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transaction or a motor vehicle title loan. |
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SECTION 2. Section 393.222(a), Finance Code, is amended to |
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read as follows: |
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(a) A credit access business shall post, in a conspicuous |
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location in an area of the business accessible to consumers and on |
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any Internet website, including a social media site, maintained by |
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the credit access business: |
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(1) a schedule of all fees to be charged for services |
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performed by the credit access business in connection with the |
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extension of consumer credit, including deferred presentment |
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transactions and motor vehicle title loans[, as applicable]; |
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(2) a notice of the name and address of the Office of |
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Consumer Credit Commissioner and the telephone number of the |
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office's consumer helpline; and |
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(3) for an extension of consumer credit in the form of |
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a deferred presentment transaction or motor vehicle title loan, a |
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notice that reads as follows: |
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"An advance of money obtained through a payday loan or auto |
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title loan is not intended to meet long-term financial needs. A |
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payday loan or auto title loan should only be used to meet immediate |
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short-term cash needs. Refinancing the loan rather than paying the |
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debt in full when due will require the payment of additional |
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charges." |
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SECTION 3. Section 393.223(a), Finance Code, is amended to |
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read as follows: |
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(a) Before performing services described by Section |
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393.221(1), a credit access business must provide to a consumer a |
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disclosure adopted by rule of the Finance Commission of Texas that |
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discloses the following in a form prescribed by the commission: |
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(1) the interest, fees, and annual percentage rates, |
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as applicable, to be charged on the extension of consumer credit |
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that the credit access business proposes to obtain for the consumer |
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or assist the consumer in obtaining [a deferred presentment
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transaction or on a motor vehicle title loan, as applicable,] in |
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comparison to interest, fees, and annual percentage rates to be |
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charged on other alternative forms of consumer debt; |
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(2) the amount of accumulated fees a consumer would |
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incur by renewing or refinancing the extension of consumer credit |
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if it were to remain [a deferred presentment transaction or motor
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vehicle title loan that remains] outstanding for a period of two |
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weeks, one month, two months, and three months; and |
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(3) information regarding the typical pattern of |
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repayment of extensions of consumer credit, including deferred |
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presentment transactions and motor vehicle title loans. |
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SECTION 4. Section 393.601(2), Finance Code, is amended to |
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read as follows: |
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(2) "Credit access business" means a credit services |
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organization that obtains for a consumer or assists a consumer in |
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obtaining an extension of consumer credit, including an extension |
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of consumer credit in the form of a deferred presentment |
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transaction or a motor vehicle title loan. |
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SECTION 5. Section 393.602(a), Finance Code, is amended to |
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read as follows: |
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(a) This subchapter applies only to a credit services |
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organization that obtains for a consumer or assists a consumer in |
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obtaining an extension of consumer credit [in the form of:
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[(1) a deferred presentment transaction; or
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[(2) a motor vehicle title loan]. |
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SECTION 6. The changes in law made by this Act apply only to |
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an extension of consumer credit made on or after the effective date |
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of this Act. An extension of consumer credit made before the |
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effective date of this Act is governed by the law in effect on the |
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date the extension of consumer credit was made, and the former law |
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is continued in effect for that purpose. |
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SECTION 7. This Act takes effect September 1, 2019. |