Vote Smart's Synopsis:

Vote to pass a bill that amends payday loan and motor vehicle loan standards, effective September 1, 2013.

Highlights:

• Requires the consumer credit commissioner to establish a database, operated by a third party, that is accessible to “deferred presentment transaction” brokers and contains the following information about deferred presentment transaction borrowers (Sec. 1):
• The borrower’s outstanding payday loans, if any; and
• The borrower’s eligibility to be granted a deferred presentment transaction.

• Defines “deferred presentment transaction” as a single or multiple-payment transaction in connection with which the borrower is not required to provide real or personal property as security (Sec. 3).

• Requires deferred presentment transaction brokers to submit transaction data into the database at the time of the transaction (Sec. 1).

• Establishes a fine of up to $2,000 for deferred presentment transaction brokers who provide products other than deferred presentment transactions or motor vehicle loans (Sec. 7).

• Limits the term of an extension of consumer credit from a deferred presentment transaction broker to 180 days (Sec. 15).

• Prohibits an individual from having more than 1 outstanding deferred presentment transaction and 1 outstanding motor vehicle loan at 1 time (Sec. 15).

• Limits the amount of times an extension of consumer credit can be refinanced to 4 (Sec. 15).

• Authorizes local governments to pass ordinances regulating consumer credit access, as long as all ordinances are equal to or more stringent than the requirements prescribed by the provisions of the bill (Sec. 15).

• Limits the sum of a single-payment deferred presentment transaction, including fees, principal, interest and other amounts, to the following (Sec. 15):
• 25 percent of the borrower’s gross monthly income if his or her annual income is less than $28,000; or
• 35 percent of the borrower’s gross monthly income if his or her annual income exceeds $28,000.

• Limits the sum of a multiple-payment deferred presentment transaction, including fees, principal, interest and other amounts, to the following (Sec. 15):
• 10 percent of the borrower’s gross monthly income if his or her annual income is less than $28,000; or
• 15 percent of the borrower’s gross monthly income if his or her annual income exceeds $28,000.

• Limits the sum of a multiple-payment motor vehicle title loan, including fees, principal, interest and other amounts, to the following (Sec. 15):
• 20 percent of the borrower’s gross monthly income if his or her annual income is less than $28,000; or
• 30 percent of the borrower’s gross monthly income if his or her annual income exceeds $28,000.

Full Bill Text