Texas 2017 - 85th 1st C.S.

Texas House Bill HB291 Compare Versions

Only one version of the bill is available at this time.

Old	New	Differences
1	1	85S11044 EES-F
2	2	By: Collier H.B. No. 291
3	3
4	4
5	5	A BILL TO BE ENTITLED
6	6	AN ACT
7	7	relating to the collection of consumer debt by debt buyers.
8	8	BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
9	9	SECTION 1. This Act shall be known as the Fair Consumer Debt
10	10	Collection Act.
11	11	SECTION 2. Subchapter D, Chapter 392, Finance Code, is
12	12	amended by adding Section 392.307 to read as follows:
13	13	Sec. 392.307. COLLECTION OF CERTAIN DEBT BY DEBT BUYERS.
14	14	(a) In this section:
15	15	(1) "Charged-off debt" means a consumer debt that a
16	16	creditor has determined to be a loss or expense to the creditor
17	17	instead of an asset.
18	18	(2) "Debt buyer" means a person who purchases or
19	19	otherwise acquires a consumer debt from a creditor or other
20	20	subsequent owner of the consumer debt, regardless of whether the
21	21	person collects the consumer debt, hires a third party to collect
22	22	the consumer debt, or hires an attorney for collection litigation
23	23	in connection with the consumer debt. The term does not include:
24	24	(A) a person who acquires a charged-off debt
25	25	incidental to the purchase of a portfolio that predominantly
26	26	consists of consumer debt that has not been charged off; or
27	27	(B) a check services company that acquires the
28	28	right to collect on a paper or electronic negotiable instrument,
29	29	including an Automated Clearing House (ACH) authorization to debit
30	30	an account that has not been processed.
31	31	(3) "Statute of limitations" means a law in this state
32	32	that prescribes the period during which a person may bring a cause
33	33	of action.
34	34	(b) Unless otherwise expressly provided, this section
35	35	prevails to the extent of any conflict between this section and any
36	36	other law of this state.
37	37	(c) A debt buyer may not, directly or indirectly, commence
38	38	an action against or initiate arbitration with a consumer to
39	39	collect a consumer debt later than the earlier of:
40	40	(1) the fourth anniversary of the date of the
41	41	consumer's last activity on the consumer debt; or
42	42	(2) the expiration date of any applicable statute of
43	43	limitations.
44	44	(d) A cause of action against a consumer for collection of a
45	45	consumer debt that is barred under Subsection (c) may not be revived
46	46	by a payment of the consumer debt, an oral or written reaffirmation
47	47	of the consumer debt, or any other activity on the consumer debt.
48	48	(e) If a debt buyer is engaged in debt collection for a
49	49	consumer debt for which a cause of action is barred under Subsection
50	50	(c), the debt buyer, or a debt collector acting on behalf of the
51	51	debt buyer, shall provide the following notice in the initial
52	52	written communication with the consumer relating to debt
53	53	collection:
54	54	(1) if the reporting period for including the consumer
55	55	debt in a consumer report prepared by a consumer reporting agency
56	56	has not expired under Section 605, Fair Credit Reporting Act (15
57	57	U.S.C. Section 1681c), and the debt buyer furnishes to consumer
58	58	reporting agencies information regarding the consumer debt, "THE
59	59	LAW LIMITS HOW LONG YOU CAN BE SUED ON A DEBT. BECAUSE OF THE AGE OF
60	60	YOUR DEBT, WE WILL NOT SUE YOU FOR IT. IF YOU DO NOT PAY THE DEBT,
61	61	[INSERT NAME OF DEBT BUYER] MAY CONTINUE TO REPORT IT TO THE CREDIT
62	62	REPORTING AGENCIES AS UNPAID FOR AS LONG AS THE LAW PERMITS THIS
63	63	REPORTING. THIS NOTICE IS REQUIRED BY LAW.";
64	64	(2) if the reporting period for including the consumer
65	65	debt in a consumer report prepared by a consumer reporting agency
66	66	has not expired under Section 605, Fair Credit Reporting Act (15
67	67	U.S.C. Section 1681c), but the debt buyer does not furnish to
68	68	consumer reporting agencies information regarding the consumer
69	69	debt, "THE LAW LIMITS HOW LONG YOU CAN BE SUED ON A DEBT. BECAUSE OF
70	70	THE AGE OF YOUR DEBT, WE WILL NOT SUE YOU FOR IT. THIS NOTICE IS
71	71	REQUIRED BY LAW."; or
72	72	(3) if the reporting period for including the consumer
73	73	debt in a consumer report prepared by a consumer reporting agency
74	74	has expired under Section 605, Fair Credit Reporting Act (15 U.S.C.
75	75	Section 1681c), "THE LAW LIMITS HOW LONG YOU CAN BE SUED ON A DEBT.
76	76	BECAUSE OF THE AGE OF YOUR DEBT, WE WILL NOT SUE YOU FOR IT, AND WE
77	77	WILL NOT REPORT IT TO ANY CREDIT REPORTING AGENCY. THIS NOTICE IS
78	78	REQUIRED BY LAW."
79	79	(f) A notice required under Subsection (e) must be in at
80	80	least 12-point type that is boldfaced, capitalized, or underlined
81	81	or otherwise conspicuously set out from the surrounding written
82	82	material.
83	83	SECTION 3. Section 392.402, Finance Code, is amended by
84	84	adding Subsection (d) to read as follows:
85	85	(d) This section does not apply to a violation of Section
86	86	392.307.
87	87	SECTION 4. Section 392.404(a), Finance Code, is amended to
88	88	read as follows:
89	89	(a) A violation of this chapter is a deceptive trade
90	90	practice under Subchapter E, Chapter 17, Business & Commerce Code,
91	91	and is actionable under that subchapter. This subsection does not
92	92	apply to a violation of Section 392.307.
93	93	SECTION 5. The changes in law made by this Act apply only to
94	94	an action of a debt buyer to collect a consumer debt if the action
95	95	occurs on or after the effective date of this Act. An action of a
96	96	debt buyer to collect a consumer debt that occurs before the
97	97	effective date of this Act is governed by the law in effect
98	98	immediately before that date, and the former law is continued in
99	99	effect for that purpose.
100	100	SECTION 6. This Act takes effect December 1, 2017.