This bill is the second to be authored by Anchia, and is “relating to the repayment of certain extensions of consumer credit facilitated by a Credit Access Business.” CAB’s will need to offer extended payment plans under this bill, where customer would be eligible if certain conditions are met. The conditions are: no plans within the last 12 months with that CAB, the loan has been refinanced at least 4 times, and the plan was requested before the loan went into default. The plans must be requested in writing and be signed by the CAB and the consumer. The CAB cannot charge fees or other charges under the plan, the plan must be 4 payments of equal amounts, and the client would need to be “paid in full” after the final payment, consumer may prepay with no penalty. During the plan, CAB cannot assist consumer in finding additional credit, may not engage in debt collection activity, so long as customer stays on plan. Regarding normal payment schedules on loans in good standing – the bill makes the requirement that multi-payment programs must be fully amortizing, declining principal, with close to equal payments, this was also in HB 886. Also, make note that CAB fees must be refunded if un-earned on an early payoff. The bill goes on to site many of the same existing requirements that we have now, also that the extended payment plan notice must be viewable in store. Goes into effect on 9-1-2013.

Click here for a PDF version of HB 1040! HB.1040