Michigan House Bill HB5365

Michigan 2023-2024 Regular Session

• Introduced: 11/14/23
• Refer: 11/14/23
• Refer: 1/10/24
• Report Pass: 5/23/24

Caption

Consumer protection: other; citations to the motor vehicle sales finance act in the guaranteed asset protection waiver act; revise. Amends sec. 3 of 2009 PA 229 (MCL 492.23). TIE BAR WITH: HB 5354'23

Impact

If passed, HB 5365 would have implications on existing consumer protection laws, specifically by providing clearer guidelines on the administration of guaranteed asset protection waivers. This clarity could lead to improved consumer awareness regarding their rights and responsibilities when entering finance agreements. Additionally, the bill introduces a 'free look period' during which borrowers can cancel their waivers without incurring penalties, enhancing borrower protections against potential misrepresentation or unwarranted financial obligations. These amendments are intended to align state regulations with consumer protection principles, making financial processes more accessible and understandable for consumers.

Summary

House Bill 5365 seeks to amend the Guaranteed Asset Protection Waiver Act established under Public Act 229 of 2009, focusing on clarifying and defining essential terms associated with guaranteed asset protection waivers in the context of motor vehicle financing. The bill specifies the roles of different stakeholders in the process, including 'administrators', 'creditors', and 'borrowers', emphasizing the need for clear definitions to enhance consumer understanding and regulatory compliance. This legislative amendment aims to provide a structured framework for transactions involving guaranteed asset protection waivers, thereby promoting transparency in consumer finance agreements related to motor vehicle purchases and leases.

Contention

The discussions surrounding HB 5365 may involve varying opinions on the sufficiency of regulatory measures currently in place to protect consumers in financial agreements. Supporters of the bill argue that establishing a formalized structure for guaranteed asset protection waivers will benefit consumers by preventing deceptive practices and ensuring that individuals are fully informed about their financial choices. Critics, on the other hand, may express concerns that additional regulations could lead to increased costs for credit providers, ultimately impacting the availability of consumer financing options. As such, the balance between consumer protection and market competitiveness is likely to be a significant point of negotiation as the bill progresses through the legislative process.