Bill Text: TX HB1020 | 2015-2016 | 84th Legislature | Introduced


Bill Title: Relating to credit services organizations and extensions of consumer credit facilitated by credit services organizations; providing civil and administrative penalties.

Spectrum: Partisan Bill (Democrat 2-0)

Status: (Introduced - Dead) 2015-04-29 - Left pending in committee [HB1020 Detail]

Download: Texas-2015-HB1020-Introduced.html
  84R2059 CLG-F
 
  By: Giddings H.B. No. 1020
 
 
 
A BILL TO BE ENTITLED
 
AN ACT
  relating to credit services organizations and extensions of
  consumer credit facilitated by credit services organizations;
  providing civil and administrative penalties.
         BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
         SECTION 1.  Subchapter M, Chapter 342, Finance Code, is
  amended by adding Section 342.607 to read as follows:
         Sec. 342.607.  DEFERRED PRESENTMENT TRANSACTION DATA
  COLLECTION SYSTEM. (a)  In this section, "credit access business"
  has the meaning assigned by Section 393.001(2-a).
         (b)  The commissioner shall establish and implement a
  database for the compilation of information relating to deferred
  presentment transactions that allows the commissioner or persons
  who offer, service, or broker the transactions, including a credit
  access business, to determine:
               (1)  whether an individual seeking to enter into a
  deferred presentment transaction with the person has any
  outstanding deferred presentment transactions entered into with
  other persons;
               (2)  the total number of outstanding deferred
  presentment transactions entered into by the individual described
  by Subdivision (1) with other persons; and
               (3)  whether the person is in compliance with this
  section and other provisions of law governing deferred presentment
  transactions.
         (c)  The commissioner shall contract with a third-party
  vendor to operate the database required by this section.  In
  selecting the vendor, the commissioner shall:
               (1)  consider the vendor's ability to meet the
  requirements of this section;
               (2)  consider the cost of the vendor's services;
               (3)  give strong consideration to the vendor's ability
  to prevent fraud, abuse, and other unlawful activity associated
  with deferred presentment transactions;
               (4)  give strong consideration to whether the vendor
  operates a similar database in another state; and
               (5)  give strong consideration to whether the vendor's
  operation of the database would facilitate the enforcement of laws
  governing deferred presentment transactions and the persons who
  offer, service, or broker those transactions.
         (d)  The commissioner shall ensure that:
               (1)  the third-party vendor operating the database
  operates the database in accordance with this section and rules
  adopted by the finance commission under this section; and
               (2)  the database established under this section:
                     (A)  allows persons required to submit
  information to the database to submit and access the required
  information from any location in this state;
                     (B)  provides real-time access by the
  commissioner to information contained in the database from any
  location in this state; and
                     (C)  contains safeguards to ensure that
  information contained in the database may not be accessed by an
  unauthorized person.
         (e)  A person who offers, services, or brokers a deferred
  presentment transaction, including a credit access business, shall
  submit to the database at the time the transaction is entered into 
  data relating to the transaction that the commissioner, by rule of
  the finance commission, determines necessary.
         (f)  Information in the database is confidential and is not
  subject to disclosure under Chapter 552, Government Code.
         (g)  The finance commission shall adopt rules as necessary to
  implement this section, including rules:
               (1)  relating to the form and content of information to
  be submitted to the database;
               (2)  prescribing a fee to be paid by persons required to
  submit information to be included in the database under Subsection
  (e); and
               (3)  establishing requirements for the retention,
  archiving, and deletion of information entered into or stored in
  the database.
         (h)  The third-party vendor shall charge a person who offers,
  services, or brokers a deferred presentment transaction a fee to
  access or use the database under this section.  The fee may be
  charged on a per-transaction basis and may be used only to pay the
  costs associated with the maintenance of the database under this
  section.  The finance commission by rule must approve the amount of
  the fee, which may not exceed $1 per deferred presentment
  transaction.
         (i)  A person who ceases to offer, service, or broker
  deferred presentment transactions shall continue to submit
  information required by this section for any transactions that are
  outstanding and with respect to which the person continues
  collection efforts.  Not later than the 10th day after the date the
  person ceases to offer deferred presentment transactions, the
  person shall submit to the commissioner for approval a plan for
  continuing compliance with this section.  The commissioner shall
  promptly approve or disapprove the plan.  The commissioner may
  require a person to whom this subsection applies to submit a new or
  modified plan.
         SECTION 2.  Subsection (a), Section 392.301, Finance Code,
  is amended to read as follows:
         (a)  In debt collection, a debt collector may not use
  threats, coercion, or attempts to coerce that employ any of the
  following practices:
               (1)  using or threatening to use violence or other
  criminal means to cause harm to a person or property of a person;
               (2)  accusing falsely or threatening to accuse falsely
  a person of fraud or any other crime;
               (3)  representing or threatening to represent to any
  person other than the consumer that a consumer is wilfully refusing
  to pay a nondisputed consumer debt when the debt is in dispute and
  the consumer has notified in writing the debt collector of the
  dispute;
               (4)  threatening to sell or assign to another the
  obligation of the consumer and falsely representing that the result
  of the sale or assignment would be that the consumer would lose a
  defense to the consumer debt or would be subject to illegal
  collection attempts;
               (5)  threatening that the debtor will be arrested for
  nonpayment of a consumer debt without proper court proceedings;
               (6)  threatening to file a charge, complaint, or
  criminal action against a debtor when the debtor has not violated a
  criminal law;
               (7)  threatening that nonpayment of a consumer debt
  will result in the seizure, repossession, or sale of the person's
  property without proper court proceedings;
               (8)  referencing a certification signed by the consumer
  as required by Section 393.630(b) or any penalties associated with
  a violation of that section; or
               (9) [(8)]  threatening to take an action prohibited by
  law.
         SECTION 3.  Section 393.001, Finance Code, is amended by
  amending Subdivisions (1) and (3) and adding Subdivisions (1-a),
  (2-a), (3-a), (4-a), (5), (6), (7), (8), (9), (10), (11), (12), and
  (13) to read as follows:
               (1)  "Commissioner" means the consumer credit
  commissioner.
               (1-a)  "Consumer" means an individual who is solicited
  to purchase or who purchases the services of a credit services
  organization.
               (2-a)  "Credit access business" means a credit services
  organization that obtains for a consumer or assists a consumer in
  obtaining an extension of consumer credit.
               (3)  "Credit services organization" means a person who
  provides, or represents that the person can or will provide, for the
  payment of valuable consideration any of the following services
  with respect to the extension of consumer credit by others:
                     (A)  improving a consumer's credit history or
  rating;
                     (B)  obtaining an extension of consumer credit for
  a consumer in the form of a single-payment deferred presentment
  transaction, a multiple-payment deferred presentment transaction,
  a single-payment motor vehicle title loan, or a multiple-payment
  motor vehicle title loan; or
                     (C)  providing advice or assistance to a consumer
  with regard to Paragraph (A) or (B).
               (3-a)  "Deferred presentment transaction" means a
  single-payment or multiple-payment transaction defined as a
  deferred presentment transaction by Section 341.001 in connection
  with which the consumer is not required to provide real or personal
  property as security.
               (4-a)  "Finance commission" means the Finance
  Commission of Texas.
               (5)  "Military borrower" includes a "covered member" or
  a "dependent" of a covered member, as those terms are defined by 10
  U.S.C. Section 987 or a successor statute.
               (6)  "Motor vehicle title loan" means a single-payment
  or multiple-payment loan in which an unencumbered motor vehicle is
  given as the only security for the loan, except as provided by
  Section 393.629(c).  The term does not include a retail installment
  transaction under Chapter 348 or another loan made to finance the
  purchase of a motor vehicle.
               (7)  "Multiple-payment deferred presentment
  transaction" means a deferred presentment transaction that is not a
  single-payment deferred presentment transaction.
               (8)  "Multiple-payment motor vehicle title loan" means
  a motor vehicle title loan that is not a single-payment motor
  vehicle title loan.
               (9)  "Office" means the Office of Consumer Credit
  Commissioner.
               (10)  "Refinance" means a rollover, renewal, or other
  type of transaction in which all or a portion of the principal,
  fees, or interest due under an outstanding extension of consumer
  credit becomes due on a later date. The term does not include an
  extended payment plan described by Section 393.638. The term
  includes a new extension of consumer credit that:
                     (A)  consists of debt arising from principal,
  fees, or interest that was not paid in full under an outstanding or
  previous extension of consumer credit; or
                     (B)  is made on or before the seventh day after the
  date a previous extension of consumer credit that a credit access
  business obtained for a consumer or assisted a consumer in
  obtaining was paid in full.
               (11)  "Service" means an act, conduct, or activity that
  is performed or to be performed for a consumer's benefit or that
  involves assisting a consumer in obtaining an extension of consumer
  credit, including:
                     (A)  negotiating or closing a loan or other
  extension of consumer credit;
                     (B)  issuing a guaranty, letter of credit, or
  other credit enhancement; and
                     (C)  servicing an extension of consumer credit.
               (12)  "Single-payment deferred presentment
  transaction" means a deferred presentment transaction for which the
  entire cash advance, interest, and fees are required under the
  terms of the transaction to be payable in a single payment.
               (13)  "Single-payment motor vehicle title loan" means a
  motor vehicle title loan for which the entire principal, interest,
  and fees are required under the terms of the loan to be payable in a
  single payment.
         SECTION 4.  Section 393.201, Finance Code, is amended by
  amending Subsections (b) and (c) and adding Subsection (d) to read
  as follows:
         (b)  In addition to the notice required by Section 393.202,
  the contract must:
               (1)  contain the payment terms, including the total
  payments to be made by the consumer, whether to the organization or
  to another person;
               (2)  fully describe the services the organization shall
  [is to] perform for the consumer or on behalf of a third party,
  including each guarantee and each promise of a full or partial
  refund and the estimated period for performing and completing all
  of the services, not to exceed 180 days or the period permitted
  under an extended payment plan authorized by Subchapter G;
               (3)  contain the address of the organization's
  principal place of business; and
               (4)  contain the name and address of the organization's
  agent in this state authorized to receive service of process.
         (c)  A contract with a credit access business[, as defined by
  Section 393.601,] for the performance of services [described by
  Section 393.602(a)] must, in addition to the requirements of
  Subsection (b) and Section 393.302:
               (1)  contain a statement that there is no prepayment
  penalty;
               (2)  contain a statement that a credit access business
  must comply with Chapter 392 and the federal Fair Debt Collection
  Practices Act (15 U.S.C. Section 1692 et seq.) with respect to an
  extension of consumer credit [described by Section 393.602(a)];
               (3)  contain a statement that a person may not threaten
  or pursue criminal charges against a consumer related to a check or
  other debit authorization provided by the consumer as security for
  a transaction in the absence of forgery, fraud, theft, or other
  criminal conduct;
               (4)  contain a statement that a credit access business
  must comply, to the extent applicable, with 10 U.S.C. Section 987
  and any regulations adopted under that law with respect to an
  extension of consumer credit [described by Section 393.602(a)];
               (5)  disclose to the consumer:
                     (A)  the lender from whom the extension of
  consumer credit is obtained;
                     (B)  the interest paid or to be paid to the lender;
  and
                     (C)  the specific fees that will be paid to the
  credit access business for the business's services and to any third
  party; [and]
               (6)  contain the name and address of the office, the
  office's website address, [Office of Consumer Credit Commissioner]
  and the telephone number of the office's consumer helpline; and
               (7)  use model contract clauses adopted by rule of the
  finance commission.
         (d)  The finance commission shall adopt rules to implement
  this section.
         SECTION 5.  Section 393.222, Finance Code, is amended by
  adding Subsection (a-1) to read as follows:
         (a-1)  A credit access business shall post, in the same
  manner as a notice required under Subsection (a), and provide as a
  separate document to a consumer, a notice prescribed by the finance
  commission regarding the availability of extended payment plans
  that describes the basic features of the plans.
         SECTION 6.  Subsection (a), Section 393.223, Finance Code,
  is amended to read as follows:
         (a)  Before performing services described by Section
  393.001(2-a) [393.221(1)], a credit access business must provide to
  a consumer a disclosure adopted by rule of the finance commission 
  [Finance Commission of Texas] that discloses the following in a
  form prescribed by the commission:
               (1)  the interest, fees, and annual percentage rates,
  as applicable, to be charged on a deferred presentment transaction
  or on a motor vehicle title loan, as applicable, in comparison to
  interest, fees, and annual percentage rates to be charged on other
  alternative forms of consumer debt;
               (2)  the amount of accumulated fees a consumer would
  incur by renewing or refinancing a deferred presentment transaction
  or motor vehicle title loan that remains outstanding for a period of
  two weeks, one month, two months, and three months; [and]
               (3)  information regarding the typical pattern of
  repayment of deferred presentment transactions and motor vehicle
  title loans; and
               (4)  the name of the credit access business and any
  unique number assigned to the license issued to the business under
  Subchapter G.
         SECTION 7.  Subchapter D, Chapter 393, Finance Code, is
  amended by adding Sections 393.308, 393.309, and 393.310 to read as
  follows:
         Sec. 393.308.  PROHIBITION ON OBTAINING CERTAIN LOANS OR
  EXTENSIONS OF CREDIT.  (a)  A credit services organization may not
  obtain for a consumer or assist a consumer in obtaining an extension
  of consumer credit in any form other than in the form of a
  single-payment deferred presentment transaction, a
  multiple-payment deferred presentment transaction, a
  single-payment motor vehicle title loan, or a multiple-payment
  motor vehicle title loan.
         (b)  A credit services organization may obtain for a consumer
  or assist a consumer in obtaining a loan or other extension of
  consumer credit only if the loan or extension of consumer credit is
  in the form of a deferred presentment transaction or motor vehicle
  title loan described by Subsection (a) made by a third-party lender
  that is unaffiliated with the credit services organization and does
  not have any ownership, directors, officers, members, or employees
  in common with the credit services organization.
         (c)  A credit services organization may not charge or receive
  from a consumer a fee or other valuable consideration in connection
  with a loan or other extension of consumer credit that is not a
  deferred presentment transaction or motor vehicle title loan
  described by Subsection (b).
         (d)  The finance commission may adopt rules to implement this
  section.
         (e)  Notwithstanding Section 14.252, the commissioner may
  assess an administrative penalty in an amount not to exceed $2,000
  for each violation against a credit access business that violates
  this section, regardless of whether the violation is knowing or
  wilful.
         (f)  A consumer may maintain an action under this section for
  any violation of this section.  In any suit filed under this
  section, a consumer may recover:
               (1)  damages in an amount not to exceed $10,000 for each
  violation; and
               (2)  court costs and reasonable and necessary
  attorney's fees.
         Sec. 393.309.  RESTRICTION ON AMOUNT CHARGED IN CONNECTION
  WITH EXTENSION OF CONSUMER CREDIT.  Total charges in connection
  with an extension of consumer credit that a credit services
  organization obtains for a consumer or assists the consumer in
  obtaining, including interest, lender charges, and any valuable
  consideration received by the credit services organization, may not
  exceed the permissible interest and fee and other charges for a
  similar type of consumer loan under Subchapter F, Chapter 342.
         Sec. 393.310.  EVASION OF MUNICIPAL ORDINANCE PROHIBITED.
  (a) A credit access business that is subject to the regulation of a
  municipal ordinance may not, to evade the municipal ordinance:
               (1)  require, as a condition of obtaining for a
  consumer or assisting a consumer in obtaining an extension of
  consumer credit in the form of a deferred presentment transaction
  or motor vehicle title loan or a renewal, rollover, or refinance of
  such an extension of consumer credit, that any part of the
  transaction occur in a location outside the municipality; or
               (2)  transfer the business's obligations and rights
  under a contract to obtain for a consumer or assist a consumer in
  obtaining an extension of consumer credit in the form of a deferred
  presentment transaction or motor vehicle title loan or a renewal,
  rollover, or refinance of such an extension of consumer credit to a
  branch of the business or another business located outside the
  municipality.
         (b)  For purposes of Subsection (a), "renew," "rollover," or
  "refinance" have any meanings assigned to those terms by the
  municipal ordinance.
         (c)  If a credit access business violates Subsection (a), the
  contract between the business and the consumer for the performance
  of services to which the violation relates is void and
  unenforceable, including any requirement under the contract that
  the consumer pay fees or other consideration.
         SECTION 8.  Section 393.602, Finance Code, is amended by
  amending Subsections (a) and (b) and adding Subsection (b-1) to
  read as follows:
         (a)  This subchapter applies only to a credit services
  organization that obtains for a consumer or assists a consumer in
  obtaining an extension of consumer credit [in the form of:
               [(1)  a deferred presentment transaction; or
               [(2)  a motor vehicle title loan].
         (b)  Subject to Section 393.309, a [A] credit access business
  may assess fees as agreed to between the parties for [its] services
  performed to obtain an extension of consumer credit for a consumer
  or assist a consumer in obtaining an extension of consumer credit in
  the form of a deferred presentment transaction or motor vehicle
  title loan or a refinance of such an extension of consumer credit
  [as agreed to between the parties].  A credit access business fee
  may be calculated daily, biweekly, monthly, or on another periodic
  basis.  A credit access business is permitted to charge amounts
  allowed by other laws, as applicable.  A fee may not be charged
  unless it is disclosed.
         (b-1)  Notwithstanding Subsection (a) or (b), a credit
  services organization that is not obtaining for a consumer or
  assisting a consumer in obtaining an extension of consumer credit
  may also charge or receive from a consumer a fee or other valuable
  consideration in connection with advice, assistance, or other
  services that the credit services organization provides to improve
  a consumer's credit history or rating.
         SECTION 9.  Section 393.604, Finance Code, is amended by
  amending Subsection (a) and adding Subsection (d) to read as
  follows:
         (a)  An application for a license under this subchapter must:
               (1)  be under oath;
               (2)  give the approximate location from which the
  business is to be conducted;
               (3)  identify the business's principal parties in
  interest;
               (4)  contain the name, physical address, and telephone
  number of all third-party lender organizations:
                     (A)  with which the business contracts to provide
  services; [described by Section 393.602(a)] or
                     (B)  from which the business arranges extensions
  of consumer credit [described by Section 393.602(a)]; [and]
               (5)  include a copy of each agreement between the
  business and a third-party lender organization:
                     (A)  with which the business contracts to provide
  services; or
                     (B)  from which the business arranges extensions
  of consumer credit; and
               (6)  contain other relevant information that the
  commissioner requires for the findings required under Section
  393.607.
         (d)  Information provided by an applicant under this section
  is public information for the purposes of Chapter 552, Government
  Code.
         SECTION 10.  Subsections (a) and (b), Section 393.622,
  Finance Code, are amended to read as follows:
         (a)  The finance commission may:
               (1)  adopt rules necessary to enforce and administer
  this subchapter;
               (2)  adopt rules with respect to reports of summary
  business information required to be submitted [the quarterly
  reporting] by a licensed credit access business under Section
  393.627 [licensed under this subchapter of summary business
  information relating to extensions of consumer credit described by
  Section 393.602(a)]; [and]
               (3)  adopt rules with respect to periodic examination
  by the office relating to extensions of consumer credit the
  business obtained for a consumer or assisted a consumer in
  obtaining [described by Section 393.602(a)], including rules
  related to charges for defraying the reasonable cost of conducting
  the examinations; and
               (4)  adopt rules identifying extensions of consumer
  credit that are refinances.
         (b)  The finance commission may adopt rules under this
  section to allow the commissioner to review, as part of a periodic
  examination, any relevant contracts between the credit access
  business and the third-party lender organizations with which the
  credit access business contracts to provide services [described by
  Section 393.602(a)] or from which the business arranges extensions
  of consumer credit [described by Section 393.602(a)].  A contract
  or information obtained by the commissioner under this section is
  considered proprietary and confidential to the respective parties
  to the contract, and is not subject to disclosure under Chapter 552,
  Government Code.
         SECTION 11.  Subchapter G, Chapter 393, Finance Code, is
  amended by adding Section 393.6221 to read as follows:
         Sec. 393.6221.  EXAMINATION OR INVESTIGATION BY
  COMMISSIONER; OATHS.  During an examination or an investigation,
  the commissioner or the commissioner's representative may
  administer oaths and examine a person under oath on a subject
  pertinent to a matter that the commissioner is authorized or
  required to consider, investigate, or secure information about
  under this chapter.
         SECTION 12.  Section 393.625, Finance Code, is amended to
  read as follows:
         Sec. 393.625.  MILITARY BORROWERS. (a)  An extension of
  consumer credit [described by Section 393.602(a)] that is obtained
  by a credit access business for a military borrower [member of the
  United States military or a dependent of a member of the United
  States military] or that the business assisted a military borrower 
  [that person] in obtaining must comply with 10 U.S.C. Section 987
  and any regulations adopted under that law, to the extent
  applicable.
         (b)  The term of an extension of consumer credit, including
  all renewals and refinances, obtained for a military borrower by a
  credit access business or that a credit access business assists a
  military borrower in obtaining may not exceed:
               (1)  90 days, if the debt is a deferred presentment
  transaction or single-payment motor vehicle title loan; or
               (2)  180 days, if the debt is a multiple-payment motor
  vehicle title loan.
         (c)  The finance commission shall adopt a disclosure
  relating to the provisions of state and federal law applicable to a
  military borrower who obtains an extension of consumer credit from
  or with the assistance of a credit access business.  A credit access
  business shall provide this disclosure to military borrowers for
  whom the credit access business seeks to obtain an extension of
  consumer credit.
         (d)  Notwithstanding Section 14.252, the commissioner may
  assess an administrative penalty in an amount not to exceed $5,000
  for each violation against a credit access business that violates
  this section, regardless of whether the violation is knowing or
  wilful.
         SECTION 13.  Section 393.626, Finance Code, is amended to
  read as follows:
         Sec. 393.626.  DEBT COLLECTION PRACTICES.  A violation of
  Chapter 392 by a credit access business with respect to obtaining
  for a consumer or assisting a consumer in obtaining an extension of
  consumer credit [described by Section 393.602(a)] constitutes a
  violation of this subchapter.
         SECTION 14.  Section 393.627, Finance Code, is amended to
  read as follows:
         Sec. 393.627.  REPORTS [QUARTERLY REPORT] TO COMMISSIONER.  
  (a)  A credit access business shall file [a] quarterly and annual
  reports [report] with the commissioner on forms [a form] prescribed
  by the commissioner that provide [provides] the following
  information relating to extensions of consumer credit [described by
  Section 393.602(a)] during the preceding quarter or year, as
  applicable:
               (1)  the number of consumers for whom the business
  obtained or assisted in obtaining those extensions of consumer
  credit;
               (2)  the number of those extensions of consumer credit
  obtained by the business or that the business assisted consumers in
  obtaining;
               (3)  the number of refinancing transactions of the
  extensions of consumer credit described by Subdivision (2);
               (4)  the number of consumers refinancing the extensions
  of consumer credit described by Subdivision (2);
               (5)  the number of consumers refinancing more than once
  the extensions of consumer credit described by Subdivision (2);
               (6)  the average amount of the extensions of consumer
  credit described by Subdivision (2);
               (7)  the total amount of fees charged by the business
  for the activities described by Subdivision (1);
               (8)  the number of vehicles surrendered or repossessed
  under the terms of an extension of consumer credit in the form of a
  motor vehicle title loan obtained by the business or that the
  business assisted a consumer in obtaining;
               (9)  the number of extended payment plans offered by
  the credit access business and entered into by consumers, for each
  product [the mean, median, and mode of the number of extensions of
  consumer credit obtained by consumers as a result of entering into
  the extensions of consumer credit described by Subdivision (2)];
  and
               (10)  any related information the commissioner
  determines necessary.
         (b)  All information submitted by a credit access business to
  the commissioner for inclusion in a report under this section is
  confidential.
         (c)  The commissioner shall publish a statewide consolidated
  analysis and recapitulation of reports filed under this section.  
  The commissioner may also publish a consolidated analysis and
  recapitulation of the reports that provides an analysis of the 15
  largest metropolitan statistical areas and the five largest
  counties of this state.
         SECTION 15.  Subchapter G, Chapter 393, Finance Code, is
  amended by adding Sections 393.629 through 393.640 to read as
  follows:
         Sec. 393.629.  GENERAL LIMITATIONS ON EXTENSIONS OF CONSUMER
  CREDIT; LANGUAGE REQUIREMENTS; PAYMENT METHOD. (a)  The
  provisions of this chapter applicable to a credit access business
  apply to any consumer physically located in this state at the time
  the extension of consumer credit is made, regardless of whether the
  extension of consumer credit was made in person in this state.
         (b)  The finance commission by rule shall adopt Spanish
  versions of the model contract clauses and all notices that a credit
  access business is required to give to a consumer under this
  chapter.  A credit access business shall provide to the consumer a
  contract that uses the adopted Spanish clauses and notices to the
  consumer if in the process of obtaining an extension of consumer
  credit the consumer requests that the documents be provided in
  Spanish or if the contract is negotiated in Spanish. The executed
  contract and any other binding and controlling document between the
  credit access business and the consumer must be written in English.
         (c)  A credit access business shall accept a payment made in
  cash or by electronic transfer, cashier's check, teller's check, or
  money order offered by the consumer or another party, to retire or
  otherwise pay down debt incurred under an extension of consumer
  credit that a credit access business obtained for a consumer or
  assisted a consumer in obtaining under this chapter.  For a motor
  vehicle title loan, a consumer may also grant a security interest in
  an authorized debit of a bank account.
         (d)  The term of an extension of consumer credit obtained for
  a consumer by a credit access business or that a credit access
  business assists a consumer in obtaining may not exceed 180 days.  
  If a term of less than 180 days for an extension of consumer credit
  is specified under this chapter, the shorter term applies.
         Sec. 393.630.  LIMITATION ON OUTSTANDING DEBT. (a)  At any
  one time, a consumer may have only one outstanding debt from a
  deferred presentment transaction that a credit access business
  obtained for the consumer or assisted the consumer in obtaining and
  one outstanding debt from a motor vehicle title loan that a credit
  access business obtained for the consumer or assisted the consumer
  in obtaining.
         (b)  To obtain an extension of consumer credit in the form of
  a deferred presentment transaction facilitated through the
  services of a credit access business, a consumer must sign a written
  certification on a form adopted by finance commission rule stating
  that the consumer has no other outstanding debt from an extension of
  consumer credit in the form of a deferred presentment transaction.
         (c)  A credit access business shall in good faith verify that
  a consumer is not falsifying the certification required by
  Subsection (b), to the best knowledge and ability of the person
  acting on behalf of the credit access business for that
  transaction.  A person acting on behalf of a credit access business
  has satisfied this requirement if the person considers all
  information that the consumer shares with the person in negotiating
  the transaction and if the person makes a reasonable effort to
  verify the consumer's representations with any records that the
  credit access business typically consults in the normal course of
  its business.
         (d)  A credit access business that violates this section is
  subject to a civil penalty in an amount not to exceed $1,000 for
  each violation.
         Sec. 393.631.  LIMITATIONS RELATING TO MOTOR VEHICLE
  SECURING DEBT. (a)  The proceeds of the sale of a repossessed motor
  vehicle that secured a motor vehicle title loan shall satisfy all
  outstanding and unpaid indebtedness under that extension of
  consumer credit, and the consumer is not liable for any deficiency
  resulting from the sale unless the consumer has committed fraud or
  has committed a wilful act of misconduct that damages or impairs the
  value of the motor vehicle.
         (b)  Any fee charged to a consumer for the repossession of a
  motor vehicle given as security for a motor vehicle title loan must
  be reasonable and may not exceed the amount actually paid by the
  credit access business or the lender to a third party for the
  repossession.
         (c)  A repossession under this chapter must comply with
  Chapter 9, Business & Commerce Code, except as otherwise provided
  by this section.
         Sec. 393.632.  ESTABLISHMENT OF INCOME OR VALUE; REFERENCE
  AMOUNT. (a)  A credit access business must require documentation
  to establish a consumer's income for purposes of this subchapter.
  Acceptable forms of documentation include paper, facsimile, or
  electronic copies of:
               (1)  a payroll document;
               (2)  a paycheck;
               (3)  a bank statement;
               (4)  a report from a nationally or regionally
  recognized credit and data reporting company;
               (5)  Internal Revenue Service Form W-2 from the
  preceding year;
               (6)  the income tax return from the preceding tax year;
               (7)  a signed letter from the consumer's employer at the
  time the extension of consumer credit is sought; or
               (8)  any other document approved by finance commission
  rule.
         (b)  A credit access business shall retain a copy of the
  documentation used to establish a consumer's income under
  Subsection (a) according to the business's standard records
  retention policy and any applicable rule or regulation establishing
  a record retention period.
         (c)  A credit access business that relies in good faith on a
  document presented by the consumer under Subsection (a) to
  establish a consumer's income has complied with this section to the
  extent the income established under that document meets the
  applicable requirements under this chapter.
         (d)  A credit access business that obtains for a consumer or
  assists a consumer in obtaining an extension of consumer credit
  through the Internet or other electronic means may rely on
  nationally or regionally recognized database reporting systems and
  may maintain a record of the database reporting system results used
  to comply with Subsections (a) and (b).
         (e)  To establish the retail value of a motor vehicle for
  purposes of this subchapter, a credit access business must:
               (1)  rely on a nationally or regionally recognized
  vehicle appraisal guide or agree in good faith with the consumer to
  the vehicle's retail value; and
               (2)  record the recognized or agreed-on value.
         (f)  For purposes of this chapter, $28,000 is the initial
  reference amount with respect to a consumer's income, and the
  commissioner shall adjust this amount annually in accordance with
  the Consumer Price Index.
         Sec. 393.633.  CERTAIN LOCAL ORDINANCES NOT PREEMPTED. This
  chapter does not preempt a local ordinance regulating a credit
  access business or an extension of consumer credit obtained for a
  consumer by a credit access business or that a credit access
  business assists a consumer in obtaining, if the ordinance is
  compatible with and equal to or more stringent than a requirement
  prescribed by this chapter.
         Sec. 393.634.  SINGLE-PAYMENT DEFERRED PRESENTMENT
  TRANSACTION. (a)  The sum of all fees, principal, interest, and
  other amounts due under an extension of consumer credit in the form
  of a single-payment deferred presentment transaction that a credit
  access business obtains for a consumer or assists a consumer in
  obtaining, excluding fees, may not exceed:
               (1)  20 percent of the consumer's gross monthly income,
  if the consumer's gross annual income is less than the reference
  amount; or
               (2)  25 percent of the consumer's gross monthly income,
  if the consumer is not described by Subdivision (1) and is not a
  military borrower to whom a different limit applies under federal
  law.
         (b)  The term of an original or refinanced extension of
  consumer credit in the form of a single-payment deferred
  presentment transaction that a credit access business obtains for a
  consumer or assists a consumer in obtaining may not be less than 10
  days or longer than 35 days.
         (c)  An extension of consumer credit in the form of a
  single-payment deferred presentment transaction that a credit
  access business obtains for a consumer or assists a consumer in
  obtaining may not be refinanced more than three times.
         (d)  If a consumer who has not entered into an extended
  payment plan with the credit access business in the preceding 12
  months refinances a single-payment deferred presentment
  transaction for the third time:
               (1)  the credit access business must offer at least one
  extended payment plan to the consumer before initiating any debt
  collection activities;
               (2)  the consumer may request, prior to the offer
  required by Subdivision (1) being made, an extended payment plan at
  any time on or after the date the consumer refinances the deferred
  presentment transaction for the third time and on or before the
  fifth day after the date on which the third refinance must be repaid
  in full;
               (3)  to comply with the requirement of Subdivision (1),
  the credit access business shall send a written notice to the
  consumer disclosing the following:
                     (A)  the amount due under the current terms of the
  extension of consumer credit if the consumer declines an extended
  payment plan;
                     (B)  the amounts due on each of the installment
  dates of an extended payment plan; and
                     (C)  the date by which the consumer must accept
  the extended payment plan in writing, which date shall be at least
  five days after the date of such notice;
               (4)  the credit access business may not initiate debt
  collection activities unless:
                     (A)  the consumer fails to accept the extended
  payment plan in writing on or before the deadline contained in the
  notice required by Subdivision (3);
                     (B)  the consumer declines the extended payment
  plan; or
                     (C)  the consumer fails to make a payment required
  by an extended payment plan that the consumer accepted; and
               (5)  if the consumer declines an extended payment plan
  that a credit access business is required to offer under
  Subdivision (1), the consumer must sign an extended payment plan
  waiver on a form prescribed by the finance commission.
         (e)  An extended payment plan required to be offered under
  Subsection (d) must comply with Section 393.638.
         (f)  A credit access business may offer a consumer an
  extended payment plan that provides the consumer with additional
  time to repay the debts obtained through a single-payment deferred
  presentment transaction, either before or after the consumer
  refinances the single-payment deferred presentment transaction for
  the third time, more than once in a 12-month period so long as the
  credit access business does not assess additional fees under the
  extended payment plan and the credit access business fully
  describes the terms of the extended payment plan, including all due
  dates and the amount due on each due date, to the consumer before
  the consumer enters into the extended payment plan. An extended
  payment plan offered under this subsection is not required to
  comply with Section 393.638.
         (g)  A credit access business shall accept a partial payment
  that complies with Section 393.629(c) paid by a consumer or on
  behalf of a consumer to pay down outstanding principal owed under a
  single-payment deferred presentment transaction that the credit
  access business obtained for the consumer or assisted the consumer
  in obtaining.
         Sec. 393.635.  MULTIPLE-PAYMENT DEFERRED PRESENTMENT
  TRANSACTION. (a)  The sum of all fees, principal, interest, and
  other amounts due under any scheduled payment of an extension of
  consumer credit in the form of a multiple-payment deferred
  presentment transaction that a credit access business obtains for a
  consumer or assists a consumer in obtaining may not exceed:
               (1)  10 percent of the consumer's gross monthly income,
  if the consumer's gross annual income is less than the reference
  amount; or
               (2)  15 percent of the consumer's gross monthly income,
  if the consumer is not described by Subdivision (1) and is not a
  military borrower to whom a different limit applies under federal
  law.
         (b)  An extension of consumer credit in the form of a
  multiple-payment deferred presentment transaction that a credit
  access business obtains for a consumer or assists a consumer in
  obtaining may not be payable by the consumer in more than 12
  installments or have an original term of more than 180 days, and the
  loan agreement must specify the number, date, and total amount due
  with regard to each installment.
         (c)  An original or refinanced extension of consumer credit
  in the form of a multiple-payment deferred presentment transaction
  that a credit access business obtains for a consumer or assists a
  consumer in obtaining must be payable on a fully amortizing,
  declining-principal-balance basis with substantially equal
  payments.  If a credit access business precomputes its fees under a
  multiple-payment deferred presentment transaction and a consumer
  prepays in full the extension of consumer credit in that form, the
  credit access business shall refund any unearned fees to the
  consumer.
         (d)  The first installment of an extension of consumer credit
  in the form of a multiple-payment deferred presentment transaction
  that a credit access business obtains for a consumer or assists a
  consumer in obtaining may not be due before the 10th day after the
  date the consumer enters into the loan agreement.  An installment
  may not be due before the 14th day or after the 31st day after the
  date a previous installment is due.
         (e)  An extension of consumer credit in the form of a
  multiple-payment deferred presentment transaction that a credit
  access business obtains for a consumer or assists a consumer in
  obtaining may not be refinanced, may not include more than 12
  installments, and may not have a term that exceeds 180 days,
  excluding an extended payment plan offered in compliance with
  Section 393.638.
         (f)  A credit access business may offer a consumer an
  extended payment plan if the extended payment plan complies with
  Section 393.638 and if the credit access business fully describes
  the terms of the extended payment plan, including all due dates and
  the amount due on each due date, to the consumer before the consumer
  enters into the extended repayment plan.
         Sec. 393.636.  SINGLE-PAYMENT MOTOR VEHICLE TITLE LOAN.
  (a)  The sum of all fees, principal, interest, and other amounts
  due under an extension of consumer credit in the form of a
  single-payment motor vehicle title loan that a credit access
  business obtains for a consumer or assists a consumer in obtaining,
  excluding fees, may not exceed the lesser of:
               (1)  six percent of the consumer's gross annual income,
  if the consumer's gross annual income is less than the reference
  amount;
               (2)  eight percent of the consumer's gross annual
  income, if the consumer is not described by Subdivision (1) and is
  not a military borrower to whom a different limit applies under
  federal law; or
               (3)  70 percent of the retail value of the motor vehicle
  securing the debt.
         (b)  The term of an original or refinanced extension of
  consumer credit in the form of a single-payment motor vehicle title
  loan that a credit access business obtains for a consumer or assists
  a consumer in obtaining may not be less than 30 days or longer than
  35 days.
         (c)  An extension of consumer credit in the form of a
  single-payment motor vehicle title loan that a credit access
  business obtains for a consumer or assists a consumer in obtaining
  may not be refinanced more than three times.  The combined terms of
  the original extension of consumer credit and any refinanced
  extensions of consumer credit, excluding an extended payment plan
  offered in compliance with Subsection (f) or Section 393.638, may
  not exceed 90 days.  The credit access business shall fully describe
  the terms of an extended payment plan, including all due dates and
  the amount due on each due date, to the consumer before the consumer
  enters into the extended payment plan.
         (d)  If a consumer who has not entered into an extended
  payment plan with the credit access business in the preceding 12
  months refinances a single-payment motor vehicle title loan for the
  third time:
               (1)  the credit access business must offer at least one
  extended payment plan to the consumer before initiating any
  activities to repossess the vehicle securing the debt;
               (2)  the consumer may request, prior to the offer
  required by Subdivision (1) being made, an extended payment plan at
  any time on or after the date the consumer refinances the motor
  vehicle title loan for the third time and on or before the fifth day
  after the date on which the third refinance must be repaid in full;
               (3)  to comply with the requirement of Subdivision (1),
  the credit access business shall send a written notice to the
  consumer disclosing the following:
                     (A)  the amount due under the current terms of the
  extension of consumer credit if the consumer declines an extended
  payment plan;
                     (B)  the amounts due on each of the installment
  dates of an extended payment plan; and
                     (C)  the date by which the consumer must accept
  the extended payment plan in writing, which date shall be at least
  five days after the date of such notice;
               (4)  the credit access business may not repossess the
  vehicle securing the debt unless:
                     (A)  the consumer fails to accept the extended
  payment plan in writing on or before the deadline contained in the
  notice required by Subdivision (3);
                     (B)  the consumer declines the extended payment
  plan; or
                     (C)  the consumer fails to make a payment required
  by an extended payment plan that the consumer accepted; and
               (5)  if the consumer declines an extended payment plan
  that a credit access business is required to offer under
  Subdivision (1), the consumer must sign an extended payment plan
  waiver on a form prescribed by the finance commission.
         (e)  An extended payment plan required to be offered under
  Subsection (d) must comply with Section 393.638.
         (f)  A credit access business may offer a consumer an
  extended payment plan that provides the consumer with additional
  time to repay the debts obtained through a single-payment motor
  vehicle title loan, either before or after the consumer refinances
  the single-payment motor vehicle title loan for the third time,
  more than once in a 12-month period so long as the credit access
  business does not assess additional fees under the extended payment
  plan and the credit access business fully describes the terms of the
  extended payment plan, including all due dates and the amount due on
  each due date, to the consumer before the consumer enters into the
  extended payment plan. An extended payment plan offered under this
  subsection is not required to comply with Section 393.638.
         (g)  A credit access business shall accept a partial payment
  that complies with Section 393.629(c) paid by a consumer or on
  behalf of a consumer to pay down outstanding principal owed under a
  single-payment motor vehicle title loan that the credit access
  business obtained for the consumer or assisted the consumer in
  obtaining.
         Sec. 393.637.  MULTIPLE-PAYMENT MOTOR VEHICLE TITLE LOAN.
  (a)  The amount advanced to a consumer under an extension of
  consumer credit in the form of a multiple-payment motor vehicle
  title loan that a credit access business obtains for a consumer or
  assists a consumer in obtaining, excluding fees, may not exceed 70
  percent of the retail value of the motor vehicle securing the debt.
         (b)  The sum of all fees, principal, interest, and other
  amounts due under any scheduled payment of an extension of consumer
  credit in the form of a multiple-payment motor vehicle title loan
  that a credit access business obtains for a consumer or assists a
  consumer in obtaining may not exceed:
               (1)  20 percent of the consumer's gross monthly income,
  if the consumer's gross annual income is less than the reference
  amount; or
               (2)  30 percent of the consumer's gross monthly income,
  if the consumer is not described by Subdivision (1) and is not a
  military borrower to whom a different limit applies under federal
  law.
         (c)  An extension of consumer credit in the form of a
  multiple-payment motor vehicle title loan that a credit access
  business obtains for a consumer or assists a consumer in obtaining
  must be payable on a fully amortizing, declining-principal-balance
  basis with substantially equal payments.  If a credit access
  business precomputes its fees under a multiple-payment motor
  vehicle title loan and a consumer prepays the loan in full, the
  credit access business shall refund any unearned fees to the
  consumer.
         (d)  An extension of consumer credit in the form of a
  multiple-payment motor vehicle title loan that a credit access
  business obtains for a consumer or assists a consumer in obtaining
  may not be payable by the consumer in more than six installments,
  and the loan agreement must specify the number, date, and total
  amount due with regard to each installment.
         (e)  The first installment of an extension of consumer credit
  in the form of a multiple-payment motor vehicle title loan that a
  credit access business obtains for a consumer or assists a consumer
  in obtaining may not be due before the 10th day after the date the
  consumer enters into the loan agreement.  A subsequent installment
  may not be due before the 28th day after the date the previous
  installment of the loan is due.
         (f)  An extension of consumer credit in the form of a
  multiple-payment motor vehicle title loan that a credit access
  business obtains for a consumer or assists a consumer in obtaining
  may not be refinanced and the loan term may not exceed 180 days,
  except as provided by Subsection (g).
         (g)  A credit access business may not initiate any activities
  to repossess the vehicle securing the debt under a multiple-payment
  motor vehicle title loan that a credit access business obtains for a
  consumer or assists a consumer in obtaining before offering the
  consumer at least one extended payment plan. An extended payment
  plan may cause the extension of consumer credit to extend beyond 180
  days so long as the extended payment plan complies with Section
  393.638 and the credit access business fully describes the terms of
  the extended payment plan, including all due dates and the amount
  due on each due date, to the consumer before the consumer enters
  into the extended payment plan.
         (h)  If the credit access business is required to offer a
  consumer an extended payment plan under Subsection (g), the credit
  access business shall send a written notice to the consumer
  disclosing the following:
               (1)  the amount due under the current terms of the
  extension of consumer credit if the consumer declines an extended
  payment plan;
               (2)  the amounts due on each of the installment dates of
  an extended payment plan; and
               (3)  the date by which the consumer must accept the
  extended payment plan in writing, which date shall be at least five
  days after the date of such notice.
         (i)  The credit access business may not repossess the vehicle
  securing the debt unless:
               (1)  the consumer fails to accept the extended payment
  plan in writing on or before the deadline contained in the notice
  required by Subsection (h)(3);
               (2)  the consumer declines the extended payment plan;
  or
               (3)  the consumer fails to make a payment required by an
  extended payment plan that the consumer accepted.
         (j)  If the consumer declines the extended payment plan, the
  consumer must sign an extended payment plan waiver on a form
  prescribed by the finance commission.
         Sec. 393.638.  EXTENDED PAYMENT PLAN REQUIREMENTS.
  (a)  This section applies to extended payment plans required to be
  offered under Sections 393.634, 393.635, 393.636, and 393.637.
         (b)  An extended payment plan must provide for payment in at
  least:
               (1)  four substantially equal installments, after
  which the outstanding balance will be paid in full, with respect to
  a single-payment deferred presentment transaction or
  single-payment motor vehicle title loan; or
               (2)  two substantially equal installments added to the
  original and refinanced term of the extension of consumer credit,
  after which the outstanding balance, including only the fees that
  would have been due under the original extension of consumer
  credit, will be paid in full, with respect to a multiple-payment
  deferred presentment transaction or multiple-payment motor vehicle
  title loan.
         (c)  The period between installment payments on an extended
  payment plan may not be shorter than:
               (1)  10 days, with respect to a single-payment deferred
  presentment transaction; or
               (2)  30 days, with respect to a multiple-payment
  deferred presentment transaction, a single-payment motor vehicle
  title loan, or a multiple-payment motor vehicle title loan.
         (d)  The first payment owed under an extended payment plan
  may not be due before the 10th day after the date the consumer
  requests an extended payment plan.
         (e)  A credit access business may not assess additional fees
  or assist a consumer in obtaining additional extensions of consumer
  credit if the consumer is paying an extension of credit under an
  extended payment plan.
         (f)  A consumer may pay in full a debt subject to an extended
  payment plan at any time without prepayment penalties.
         (g)  A person may not engage in debt collection or vehicle
  repossession activities for a debt subject to an extended payment
  plan if the consumer is in compliance with the extended payment
  plan.
         (h)  A person may not use a device, subterfuge, or pretense
  to evade the extended payment plan requirements and limitations
  imposed on a credit access business under this subchapter.
         Sec. 393.639.  REFINANCES. (a)  Any refinance of an
  extension of consumer credit that a credit access business obtains
  for a consumer or assists a consumer in obtaining:
               (1)  must be authorized under this subchapter;
               (2)  must be in the same form as the original extension
  of consumer credit; and
               (3)  must meet all the requirements applicable to the
  original extension of consumer credit, including the duration,
  transaction, and extended payment plan requirements under this
  subchapter, including the applicable income-based or vehicle
  value-based limitations under Section 393.634(a), 393.635(a),
  393.636(a), or 393.637(b), except as otherwise provided by this
  chapter.
         (b)  For purposes of this section, a single-payment deferred
  presentment transaction, a multiple-payment deferred presentment
  transaction, a single-payment motor vehicle title loan, and a
  multiple-payment motor vehicle title loan are the different forms
  of extensions of consumer credit that a credit access business may
  obtain for a consumer or assist a consumer in obtaining.
         (c)  The terms of a refinanced extension of consumer credit
  may be the same as or different from the terms of the original
  extension of consumer credit.
         (d)  A person may not use a device, subterfuge, or pretense
  to evade the refinance requirements and limitations imposed on a
  credit access business under this subchapter.
         Sec. 393.640.  RULES.  The finance commission shall adopt
  any rules necessary to implement Sections 393.629-393.639.
         SECTION 16.  Section 411.095, Government Code, is amended to
  read as follows:
         Sec. 411.095.  ACCESS TO CRIMINAL HISTORY RECORD
  INFORMATION: CONSUMER CREDIT COMMISSIONER.  The consumer credit
  commissioner is entitled to obtain from the department criminal
  history record information that relates to a person who is an
  applicant for or holder of a license under Chapter 342, 347, 348,
  351, 353, [or] 371, or 393, Finance Code.
         SECTION 17.  Sections 393.221 and 393.601, Finance Code, are
  repealed.
         SECTION 18.  The consumer credit commissioner shall
  establish and implement the database under Section 342.607, Finance
  Code, as added by this Act, not later than January 1, 2016, and
  shall prescribe the date by which a person who offers, services, or
  brokers a deferred presentment transaction must begin submitting
  data as provided by that section.
         SECTION 19.  The changes in law made by this Act apply only
  to an extension of consumer credit made on or after the effective
  date of this Act. An extension of consumer credit made before the
  effective date of this Act is governed by the law in effect on the
  date the extension of consumer credit was made, and the former law
  is continued in effect for that purpose.  For purposes of this
  section, a refinance or renewal of an extension of consumer credit
  is considered made on the date the extension of consumer credit
  being refinanced or renewed was made.
         SECTION 20.  Section 393.310, Finance Code, as added by this
  Act, applies only to a contract entered into on or after the
  effective date of this Act. A contract entered into before the
  effective date of this Act is governed by the law in effect when the
  contract was entered into, and the former law is continued in effect
  for that purpose.
         SECTION 21.  This Act takes effect September 1, 2015.
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