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H.R. 6544: Payday and Predatory Loans Moratorium Act of 2020


The text of the bill below is as of Apr 17, 2020 (Introduced).


I

116th CONGRESS

2d Session

H. R. 6544

IN THE HOUSE OF REPRESENTATIVES

April 17, 2020

introduced the following bill; which was referred to the Committee on Financial Services

A BILL

To establish a moratorium on collection efforts made by certain lenders against borrowers affected by coronavirus.

1.

Short title

This Act may be cited as the Payday and Predatory Loans Moratorium Act of 2020.

2.

Moratorium on collection efforts for certain borrowers affected by coronavirus

(a)

Moratorium

During the one-year period beginning on the date on which a borrower notifies a covered lender of the borrower being affected by coronavirus, the covered lender may not carry out any collection efforts against the borrower with respect to a loan described in subsection (b).

(b)

Loan described

A loan described in this subsection is any of the following loans:

(1)

A loan with nominal interest rates of 36 percent or more.

(2)

A loan by a covered lender described in subsection (c)(3)(B) that does not, or did not at the time of issuing the loan, determine whether the borrower can afford, while still meeting the basic living expenses and major financial obligations of the borrower—

(A)

with respect to payday and auto title loans that are due in one lump sum within one month of the date of such issuance, the full payment of the total loan amount, plus fees and finance charges; or

(B)

with respect to longer-term loans with a balloon payment, the payments for the month with the highest total payments on the loan.

(c)

Definitions

(1)

Affected by coronavirus

The term affected by coronavirus means, with respect to a borrower, any of the following circumstances:

(A)

The household income of the borrower is reduced by reason of coronavirus disease 2019 (COVID–19).

(B)

The borrower becomes unemployed by reason of such disease.

(C)

The borrower, or a member of the household of the borrower, is hospitalized by reason of such disease.

(D)

The borrower resides or is employed in an area covered by an emergency declared by the Federal Government or a State or local government as a result of such disease.

(2)

Collection efforts

The term collection efforts means any of the following actions, or attempted actions, made by a covered lender (or a collection agency acting on behalf of the covered lender) in order to collect amounts owed to the lender by a borrower:

(A)

Contacting the borrower by telephone, including by text message.

(B)

Contacting the employer of the borrower.

(C)

Cashing post-dated checks of the borrower or making a direct withdrawal from a bank account of the borrower.

(D)

Entering into an agreement with a collections agency to collect such amounts.

(E)

Reporting to a credit reporting agency any missed payments related to such amounts.

(F)

Any other effort not described in subparagraphs (A) through (E) to enforce the collection of the amounts or the making of payments related to such amounts.

(3)

Covered lender

The term covered lender means any of the following:

(A)

A payday lender.

(B)

A lender who is not a depository institution (as defined under section 3 of the Federal Deposit Insurance Act (12 U.S.C. 1813)) or a Federal or State credit union (as such terms are defined under section 101 of the Federal Credit Union Act (12 U.S.C. 1752)).