Bill Text: TX HB4219 | 2023-2024 | 88th Legislature | Enrolled
Bill Title: Relating to the maximum rate or amount of interest of certain consumer loans.
Spectrum: Partisan Bill (Republican 2-0)
Status: (Vetoed) 2023-06-18 - Vetoed by the Governor [HB4219 Detail]
Download: Texas-2023-HB4219-Enrolled.html
H.B. No. 4219 |
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relating to the maximum rate or amount of interest of certain | ||
consumer loans. | ||
BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS: | ||
SECTION 1. Section 342.201, Finance Code, is amended by | ||
amending Subsection (e) and adding Subsections (e-2) and (e-3) to | ||
read as follows: | ||
(e) A loan contract under this chapter that is not secured | ||
by real property may provide for a rate or amount of interest | ||
computed using the true daily earnings method or the scheduled | ||
installment earnings method that does not exceed: | ||
(1) 30 percent plus the federal funds rate a year on | ||
that part of the cash advance that is less than or equal to the | ||
amount computed under Subchapter C, Chapter 341, using the | ||
reference base amount of $500; | ||
(2) 24 percent plus the federal funds rate a year on | ||
that part of the cash advance that is more than the amount computed | ||
for Subdivision (1) but less than or equal to an amount computed | ||
under Subchapter C, Chapter 341, using the reference base amount of | ||
$1,050; and | ||
(3) 18 percent plus the federal funds rate a year on | ||
that part of the cash advance that is more than the amount computed | ||
for Subdivision (2) but less than or equal to an amount computed | ||
under Subchapter C, Chapter 341, using the reference base amount of | ||
$2,500. | ||
(e-2) On March 1 and September 1 of each year, the | ||
commissioner shall compute the ceilings applicable under | ||
Subsection (e) for the six-month period effective the following May | ||
1 and November 1, respectively. As prescribed by this subsection, | ||
the ceilings are effective for the six-month period beginning on | ||
the effective date and are subject to adjustment after each | ||
six-month period. The commissioner shall submit to the secretary | ||
of state for publication in the Texas Register the ceilings | ||
computed under this subsection not later than the 11th day after the | ||
date on which the ceiling is computed. | ||
(e-3) For purposes of this section: | ||
(1) "Ceiling" means the maximum rate or amount of | ||
interest. | ||
(2) "Federal funds rate" means an interest rate | ||
computed by averaging the Federal Funds rates published by the | ||
Federal Reserve Bank of New York for each day during the six | ||
calendar months preceding the computation date of the ceilings, | ||
except that if that average: | ||
(A) is greater than five percent, the federal | ||
funds rate is five percent; and | ||
(B) is less than zero percent, the federal funds | ||
rate is zero percent. | ||
SECTION 2. The change in law made by this Act applies only | ||
to a loan made on or after the effective date of this Act. A loan | ||
made before the effective date of this Act is governed by the law in | ||
effect on the date the loan was made, and the former law is | ||
continued in effect for that purpose. For purposes of this section, | ||
a refinance or renewal of a loan is considered made on the date the | ||
loan being refinanced or renewed was made. | ||
SECTION 3. This Act takes effect September 1, 2023. | ||
______________________________ | ______________________________ | |
President of the Senate | Speaker of the House | |
I certify that H.B. No. 4219 was passed by the House on May 9, | ||
2023, by the following vote: Yeas 130, Nays 13, 2 present, not | ||
voting. | ||
______________________________ | ||
Chief Clerk of the House | ||
I certify that H.B. No. 4219 was passed by the Senate on May | ||
22, 2023, by the following vote: Yeas 28, Nays 3. | ||
______________________________ | ||
Secretary of the Senate | ||
APPROVED: _____________________ | ||
Date | ||
_____________________ | ||
Governor |