Relating to a restriction on the services provided by a credit services organization with respect to certain extensions of consumer credit.
Impact
Should HB2211 be enacted, it will have significant implications for the regulation of credit services organizations in Texas. The bill outlines clear boundaries regarding what types of consumer credit transactions these organizations can engage in, thereby reinforcing consumer protections. This is particularly relevant in the context of loans secured by a motor vehicle certificate of title, or situations where personal checks or debit authorizations are used as collateral. The law is set to take effect on September 1, 2009, thereby providing a specific timeline for organizations to comply with the new restrictions.
Summary
House Bill 2211 seeks to place restrictions on the services provided by credit services organizations, particularly concerning specific extensions of consumer credit. The primary goal of this bill is to curtail the practices wherein credit services organizations would obtain or facilitate loans that are connected to certain types of collateral, notably motor vehicle titles and payment authorizations linked to the consumer's personal bank accounts. By implementing these prohibitions, the bill aims to protect consumers from potentially exploitative lending practices.
Contention
While the bill aims to protect consumers, there may be contention regarding its potential impact on credit availability and the operations of credit services organizations. Supporters of the bill might argue that it is a necessary measure to prevent consumer exploitation and ensure fair lending practices. Conversely, critics may raise concerns that such restrictions could limit access to credit for individuals who rely on these services, particularly in low-income communities where traditional banking options may be scarce. Thus, the balance between consumer protection and access to credit remains a pivotal discussion point in the discourse surrounding this legislation.
Relating to credit services organizations and extensions of consumer credit facilitated by credit services organizations; increasing a criminal penalty.
Relating to a restriction on total charges charged for extensions of consumer credit that a credit services organization obtains for a consumer or assists a consumer in obtaining.
Relating to a restriction on total charges charged for certain extensions of consumer credit that are facilitated by credit access businesses and entered into by consumers residing in disaster areas.
Relating to the regulation of money services businesses; creating a criminal offense; creating administrative penalties; authorizing the imposition of a fee.