Florida Senate - 2017 COMMITTEE AMENDMENT
Bill No. SB 594
Ì872886]Î872886
LEGISLATIVE ACTION
Senate . House
Comm: RCS .
03/27/2017 .
.
.
.
—————————————————————————————————————————————————————————————————
—————————————————————————————————————————————————————————————————
The Committee on Banking and Insurance (Garcia) recommended the
following:
1 Senate Amendment (with title amendment)
2
3 Delete everything after the enacting clause
4 and insert:
5 Section 1. Subsections (1) and (3) of section 516.031,
6 Florida Statutes, are amended to read:
7 516.031 Finance charge; maximum rates.—
8 (1) INTEREST RATES.—A licensee may lend any sum of money up
9 to $25,000. A licensee may not take a security interest secured
10 by land on any loan less than $1,000. The licensee may charge,
11 contract for, and receive thereon interest charges as provided
12 and authorized by this section. If two or more interest rates
13 are applied to the principal amount of a loan, the licensee may
14 charge, contract for, and receive interest at that single annual
15 percentage rate that, if applied according to the actuarial
16 method to each of the scheduled periodic balances of principal,
17 would produce at maturity the same total amount of interest as
18 would result from the application of the two or more rates
19 otherwise permitted, based upon the assumption that all payments
20 are made as agreed.
21 (a) Except as provided in paragraph (b), the maximum
22 interest rate shall be 30 percent per annum, computed on the
23 first $3,000 of the principal amount; 24 percent per annum on
24 that part of the principal amount exceeding $3,000 and up to
25 $4,000; and 18 percent per annum on that part of the principal
26 amount exceeding $4,000 and up to $25,000. The original
27 principal amount as used in this paragraph section is the same
28 as the amount financed as defined by the federal Truth in
29 Lending Act and Regulation Z of the federal Consumer Financial
30 Protection Bureau Board of Governors of the Federal Reserve
31 System. In determining compliance with the statutory maximum
32 interest and finance charges set forth in this subsection
33 herein, the computations used must shall be simple interest and
34 not add-on interest or any other computations.
35 (b) A licensee may make a loan in a principal amount less
36 than $5,000 and charge, contract for, and receive interest
37 charges and other charges authorized by this chapter, subject to
38 the following:
39 1. A borrower may rescind the loan by notifying the
40 licensee of such intent, and returning to the licensee the full
41 principal amount of the loan advanced to the borrower, as well
42 as any payments made for ancillary products, within 2 business
43 days after the date the loan is made. The licensee must disclose
44 such right in writing to the borrower before the loan is made.
45 2. A licensee may not take any security interest on the
46 loan.
47 3. The term of the loan may not be less than 120 days or
48 more than 37 months.
49 4. The maximum annual interest rate of the loan shall be 36
50 percent per annum, computed on the original principal amount of
51 the loan. The interest rate of the loan calculated as of the
52 date the loan is made must be fixed for the life of the loan.
53 The original principal amount of the loan is equal to the amount
54 financed as defined by the federal Truth in Lending Act and
55 Regulation Z of the federal Consumer Financial Protection
56 Bureau. In determining compliance with the statutory maximum
57 interest rate in this paragraph, the computations used must be
58 simple interest and may not be add-on interest or any other
59 computations.
60 5. A licensee may not induce or permit any person to become
61 obligated to the licensee, directly or contingently, or both,
62 under more than one loan with the licensee made under this
63 subsection at the same time.
64 6. A licensee may not refinance a loan made under this
65 paragraph with another loan made under this paragraph, unless
66 the borrower has repaid at least 60 percent of the principal
67 amount of his or her outstanding loan and his or her outstanding
68 loan is not in default. For purposes of this paragraph, the term
69 “refinance” means the replacement or revision of an existing
70 loan contract with a borrower that results in an extension of
71 additional principal to that borrower.
72 7. A licensee shall make a determination of a borrower’s
73 ability to repay a loan made under this paragraph by determining
74 that the borrower’s residual income will be sufficient for the
75 consumer to make the scheduled payments when due under the loan
76 and meet basic living expenses during the term of the loan. The
77 borrower’s residual income must be calculated using net income,
78 verified by payroll receipts, tax returns, bank statements,
79 benefit letters, or other reliable third party means, less debt
80 payments and basic living expenses. Basic living expenses,
81 including housing and utility costs, may be estimated using any
82 reasonable means or database.
83 8. The licensee must report each borrower’s full payment
84 performance under the loan, including positive payment
85 performance, to at least one consumer reporting agency that
86 compiles and maintains files on consumers on a nationwide basis
87 as defined in s. 603(p) of the federal Fair Credit Reporting
88 Act, 15 U.S.C. s. 1681a(p), upon the licensee’s acceptance as a
89 data furnisher by that consumer reporting agency.
90 9. Before making the loan, the licensee must disclose in
91 writing to the borrower information about the office’s consumer
92 credit counseling services available under s. 516.32.
93 10. A licensee shall make available to the borrower by
94 electronic or physical means, at the time that a payment is made
95 by the borrower, a plain and complete receipt of payment.
96 11.a. A licensee may not initiate a payment transfer from a
97 borrower’s bank account in connection with collecting an amount
98 due under the loan after the licensee has attempted to initiate
99 the payment transfer two consecutive times and each attempt
100 resulted in a return indicating that the borrower’s bank account
101 lacked sufficient funds. A licensee may collect only one
102 insufficient funds fee for each payment transfer that is
103 dishonored, regardless of whether the payment transfer was
104 initiated and dishonored a second time. A licensee may not
105 condition the making of a loan on the borrower’s repayment by
106 one or more electronic funds transfers or predated checks.
107 b. For purposes of this paragraph, the term “payment
108 transfer” means a debit or funds withdrawal and includes, but is
109 not limited to, an electronic funds transfer as defined in the
110 federal Electronic Funds Transfer Act and Regulation E, 12
111 C.F.R. part 1005, of the federal Consumer Financial Protection
112 Bureau, or a paper check processed through a funds-transfer
113 system, as defined in s. 670.105, or through the Automated
114 Clearing House (ACH) network If two or more interest rates are
115 applied to the principal amount of a loan, the licensee may
116 charge, contract for, and receive interest at that single annual
117 percentage rate which, if applied according to the actuarial
118 method to each of the scheduled periodic balances of principal,
119 would produce at maturity the same total amount of interest as
120 would result from the application of the two or more rates
121 otherwise permitted, based upon the assumption that all payments
122 are made as agreed.
123 (3) OTHER CHARGES.—
124 (a) In addition to the interest, delinquency, and insurance
125 charges provided in this section, further or other charges or
126 amount for any examination, service, commission, or other thing
127 or otherwise may not be directly or indirectly charged,
128 contracted for, or received as a condition to the grant of a
129 loan, except:
130 1. An amount of up to $25 to reimburse a portion of the
131 costs for investigating the character and credit of the person
132 applying for the loan;
133 2. An annual fee of $25 on the anniversary date of each
134 line-of-credit account;
135 3. Charges paid for the brokerage fee on a loan or line of
136 credit of more than $10,000, title insurance, and the appraisal
137 of real property offered as security if paid to a third party
138 and supported by an actual expenditure;
139 4. Intangible personal property tax on the loan note or
140 obligation if secured by a lien on real property;
141 5. The documentary excise tax and lawful fees, if any,
142 actually and necessarily paid out by the licensee to any public
143 officer for filing, recording, or releasing in any public office
144 any instrument securing the loan, which may be collected when
145 the loan is made or at any time thereafter;
146 6. The premium payable for any insurance in lieu of
147 perfecting any security interest otherwise required by the
148 licensee in connection with the loan if the premium does not
149 exceed the fees which would otherwise be payable, which may be
150 collected when the loan is made or at any time thereafter;
151 7. Actual and reasonable attorney fees and court costs as
152 determined by the court in which suit is filed;
153 8. Actual and commercially reasonable expenses for
154 repossession, storing, repairing and placing in condition for
155 sale, and selling of any property pledged as security; or
156 9. A delinquency charge of up to $15 for each payment in
157 default for at least 10 days if the charge is agreed upon, in
158 writing, between the parties before imposing the charge. No more
159 than one delinquency charge may be imposed for each payment in
160 default. A maximum delinquency charge of $15 may be imposed for
161 loans repayable in monthly installments. For loans repayable in
162 installments due less than monthly, the maximum of all
163 delinquency charges imposed during a calendar month may not
164 exceed $15.
165
166 Any charges, including interest, in excess of the combined total
167 of all charges authorized and permitted by this chapter
168 constitute a violation of chapter 687 governing interest and
169 usury, and the penalties of that chapter apply. In the event of
170 a bona fide error, the licensee shall refund or credit the
171 borrower with the amount of the overcharge immediately but
172 within 20 days after the discovery of such error.
173 (b) Notwithstanding the provisions of paragraph (a), any
174 lender of money who receives a check, draft, electronic funds
175 transfer as defined in the federal Electronic Funds Transfer Act
176 and Regulation E of the federal Consumer Financial Protection
177 Bureau, negotiable order of withdrawal, or like instrument or
178 transfer drawn on a bank or other depository institution, which
179 instrument or transfer is given by a borrower as full or partial
180 repayment of a loan, may, if such instrument or transfer is not
181 paid or is dishonored by such institution, make and collect from
182 the borrower an insufficient funds fee a bad check charge of not
183 more than the greater of $20 or an amount equal to the actual
184 fee charged charge made to the lender by the depository
185 institution for the return of the unpaid or dishonored
186 instrument or transfer.
187 Section 2. This act shall take effect July 1, 2017.
188
189 ================= T I T L E A M E N D M E N T ================
190 And the title is amended as follows:
191 Delete everything before the enacting clause
192 and insert:
193 A bill to be entitled
194 An act relating to consumer finance; amending s.
195 516.031, F.S.; authorizing a licensee under the
196 Florida Consumer Finance Act to charge, contract for,
197 and receive a specified interest rate on certain
198 loans; authorizing such licensee to make certain loans
199 subject to certain conditions; defining the term
200 “payment transfer”; specifying limitations for
201 delinquency charges; revising a provision authorizing
202 insufficient funds fees under certain circumstances;
203 providing an effective date.