| 1 | 1 | | 81R1030 DWS-F |
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| 2 | 2 | | By: Shapleigh S.B. No. 248 |
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| 3 | 3 | | |
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| 4 | 4 | | |
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| 5 | 5 | | A BILL TO BE ENTITLED |
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| 6 | 6 | | AN ACT |
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| 7 | 7 | | relating to the interest and fees that may be charged for certain |
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| 8 | 8 | | consumer loans; providing a criminal penalty. |
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| 9 | 9 | | BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS: |
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| 10 | 10 | | SECTION 1. Subchapter E, Chapter 342, Finance Code, is |
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| 11 | 11 | | amended by adding Section 342.200 to read as follows: |
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| 12 | 12 | | Sec. 342.200. INTEREST CHARGES: GENERAL LIMIT, |
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| 13 | 13 | | COMPUTATION, AND PAYMENT. (a) Notwithstanding any other provision |
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| 14 | 14 | | of this subchapter, Subchapter F, or a rule adopted under this |
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| 15 | 15 | | chapter, unless the provision sets a lower limit on an interest |
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| 16 | 16 | | charge, a loan contract under this chapter that is not secured by |
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| 17 | 17 | | real property may not provide for an interest charge for the cash |
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| 18 | 18 | | advance that exceeds 36 percent a year, including any fees included |
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| 19 | 19 | | in the computation of interest under this chapter or other law. |
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| 20 | 20 | | (b) A charge for interest must be computed and paid as a |
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| 21 | 21 | | percentage of the unpaid principal balance. For purposes of this |
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| 22 | 22 | | subsection, "unpaid principal balance" means the balance that has |
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| 23 | 23 | | not been paid, exclusive of any interest, service charges, or other |
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| 24 | 24 | | charges related to the loan. |
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| 25 | 25 | | (c) An interest rate charged on an overdue balance may not |
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| 26 | 26 | | exceed the maximum rate charged before the balance becomes due. |
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| 27 | 27 | | SECTION 2. Subchapter H, Chapter 342, Finance Code, is |
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| 28 | 28 | | amended by adding Section 342.354 to read as follows: |
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| 29 | 29 | | Sec. 342.354. REFUND OF PRECOMPUTED INTEREST: OTHER LOANS. |
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| 30 | 30 | | (a) This section applies only to a loan contract to which Section |
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| 31 | 31 | | 342.351 or 342.352 does not apply. |
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| 32 | 32 | | (b) If the contract is prepaid in full, the lender shall |
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| 33 | 33 | | refund or credit to the borrower unearned interest charges paid by |
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| 34 | 34 | | the borrower, as computed by the actuarial method or another method |
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| 35 | 35 | | that is at least as favorable to the borrower. |
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| 36 | 36 | | SECTION 3. Subchapter M, Chapter 342, Finance Code, is |
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| 37 | 37 | | amended by adding Section 342.606 to read as follows: |
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| 38 | 38 | | Sec. 342.606. INTEREST AND FEES FOR DEFERRED PRESENTMENT |
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| 39 | 39 | | TRANSACTION. (a) A lender may not charge or receive interest or |
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| 40 | 40 | | fees in connection with a deferred presentment transaction other |
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| 41 | 41 | | than the interest and fees specifically authorized by this section. |
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| 42 | 42 | | (b) A deferred presentment transaction may provide for an |
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| 43 | 43 | | administrative fee not to exceed $5 for each transaction. An |
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| 44 | 44 | | administrative fee is not included in the computation of interest. |
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| 45 | 45 | | (c) If there are insufficient funds to pay a check on the |
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| 46 | 46 | | date of presentment, a lender may charge a fee not to exceed the |
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| 47 | 47 | | greater of $15 or the amount charged to the lender by the financial |
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| 48 | 48 | | institution. Only one fee may be charged under this section for a |
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| 49 | 49 | | single check, regardless of whether the check has been deposited |
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| 50 | 50 | | and returned more than once. A fee under this subsection is the |
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| 51 | 51 | | exclusive authorized charge for late payment. |
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| 52 | 52 | | (d) A person who violates this section commits an offense. |
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| 53 | 53 | | An offense under this subsection is a state jail felony. |
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| 54 | 54 | | SECTION 4. This Act takes effect September 1, 2009. |
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