Veterans and Consumers Fair Credit Act
This bill applies certain military consumer credit protections to all consumers. Specifically, the bill caps the interest rate on extensions of consumer credit at 36%.
[Congressional Bills 117th Congress]
[From the U.S. Government Publishing Office]
[H.R. 5974 Introduced in House (IH)]
<DOC>
117th CONGRESS
1st Session
H. R. 5974
To amend the Truth in Lending Act to extend the consumer credit
protections provided to members of the Armed Forces and their
dependents under title 10, United States Code, to all consumers.
_______________________________________________________________________
IN THE HOUSE OF REPRESENTATIVES
November 15, 2021
Mr. Garcia of Illinois (for himself, Mr. Grothman, Mr. Blumenauer, Ms.
Bonamici, Mr. Carson, Mr. Danny K. Davis of Illinois, Ms. Garcia of
Texas, Ms. Jackson Lee, Mr. Krishnamoorthi, Mr. Lieu, Mr. Lowenthal,
Mrs. Carolyn B. Maloney of New York, Mr. Payne, Mr. Pocan, Ms. Tlaib,
Mrs. Watson Coleman, and Ms. Norton) introduced the following bill;
which was referred to the Committee on Financial Services
_______________________________________________________________________
A BILL
To amend the Truth in Lending Act to extend the consumer credit
protections provided to members of the Armed Forces and their
dependents under title 10, United States Code, to all consumers.
Be it enacted by the Senate and House of Representatives of the
United States of America in Congress assembled,
SECTION 1. SHORT TITLE.
This Act may be cited as the ``Veterans and Consumers Fair Credit
Act''.
SEC. 2. LIMITATIONS ON CONSUMER CREDIT AND MAXIMUM RATES OF INTEREST.
(a) In General.--Chapter 2 of the Truth in Lending Act (15 U.S.C.
1631 et seq.) is amended by adding at the end the following:
``Sec. 140B. Limitations on consumer credit and maximum rates of
interest
``(a) Application of the Military Lending Act.--
``(1) In general.--Except as provided in paragraph (2),
section 987(b) of title 10, United States Code (commonly
referred to as the `Military Lending Act'), shall apply to a
creditor who extends consumer credit to a consumer to the same
extent as such section applies to a creditor who extends
consumer credit to a covered member or a dependent with respect
to a covered member (as those terms are defined in such section
987).
``(2) Exceptions.--Paragraph (1) shall not apply to--
``(A) a residential mortgage;
``(B) a loan procured in the course of purchasing a
car, when that loan is offered for the express purpose
of financing the purchase and is secured by the car
procured; or
``(C) a loan made by a Federal credit union, as
that term is defined in section 101 of the Federal
Credit Union Act (12 U.S.C. 1752), subject to the usury
limit provided under section 107(5)(A) of the Federal
Credit Union Act (12 U.S.C. 1757(5)(A)), as implemented
by the National Credit Union Administration Board.
``(b) No Exemptions Permitted.--The exemption authority of the
Bureau under section 105(f) shall not apply with respect to this
section.
``(c) Calculation of the Annual Percentage Rate for Open-End
Credit.--
``(1) In general.--For purposes of this section, the annual
percentage rate applicable to an open end credit plan shall be
calculated under section 107(a)(2), subject to adjustments to
the amount considered a finance charge, as provided in the
rules issued by the Secretary of Defense on July 22, 2015, to
carry out section 987 of title 10, United States Code.
``(2) Exception to finance charge calculation.--
``(A) In general.--Notwithstanding paragraph (1),
for consumer credit extended in a credit card account
under an open end (not home-secured) consumer credit
plan, a bona fide fee other than a periodic rate is not
a charge required to be included within the finance
charge for purposes of this section if the fee is
assessed in compliance with section 127(n).
``(B) Limitation.--Subparagraph (A) shall not apply
to--
``(i) any credit insurance premium or fee,
including any charge for single premium credit
insurance, any fee for a debt cancellation
contract, or any fee for a debt suspension
agreement; or
``(ii) any fee for a credit-related
ancillary product sold in connection with the
credit card account under an open-end (not
home-secured) consumer credit plan.
``(d) Relation to State Law.--Nothing in this section may be
construed to preempt any provision of State law that provides greater
protection to consumers than is provided under this section.
``(e) Penalties and Remedies.--Section 987(f) of title 10, United
States Code, shall apply to a creditor who extends consumer credit to a
consumer in violation of this section to the same extent as such
section 987(f) applies to a creditor who extends consumer credit to a
covered member or a dependent with respect to a covered member (as
those terms are defined in such section 987).
``(f) Preservation of State Enforcement.--
``(1) State attorneys general.--Not later than 3 years
after the date on which a violation of this section occurs, the
attorney general of a State (or an equivalent official) may
bring a civil action in the name of that State--
``(A) in any district court of the United States
that is located in that State or in a State court that
is located in that State and that has jurisdiction over
the defendant; and
``(B) to--
``(i) enforce provisions of this section or
rules issued under this section; and
``(ii) secure remedies under provisions of
this section or remedies otherwise provided
under other law.
``(2) State regulators.--Not later than 3 years after the
date on which a violation of this section occurs, a State
regulator may bring a civil action or initiate another
appropriate proceeding to--
``(A) enforce the provisions of this section or
regulations issued under this section with respect to
any entity that is, or is required to be, State-
chartered, incorporated, licensed, or otherwise
authorized to do business under State law; and
``(B) secure remedies under provisions of this
section or remedies otherwise provided under other
provisions of law with respect to an entity described
in subparagraph (A).
``(3) Notice requirement; additional regulations.--
Subsections (b), (c), and (d) of section 1042 of the Consumer
Financial Protection Act of 2010 (12 U.S.C. 5552), shall apply
to a civil action or other appropriate proceeding brought or
initiated under paragraph (1) or (2) to the same extent as
those subsections apply to actions and other administrative and
regulatory proceedings described in subsection (a) of such
section 1042.
``(g) Regulations.--
``(1) In general.--Notwithstanding section 1027(o) of the
Consumer Financial Protection Act of 2010 (12 U.S.C. 5517(o)),
not later than 1 year after the date of enactment of this
section, the Bureau, in consultation with the Secretary of
Defense, shall--
``(A) issue rules carrying out this section; and
``(B) notify Congress and the public, including on
the website of the Bureau, regarding the issuance of
the rules required under subparagraph (A).
``(2) Consistency.--The rules issued by the Bureau under
paragraph (1)--
``(A) shall be consistent with rules issued by the
Secretary of Defense to carry out section 987 of title
10, United States Code; and
``(B) may not provide lesser protection to
consumers than the protection afforded covered members,
as that term is defined in section 987 of title 10,
United States Code, in applicable provisions in the
rules issued by the Secretary of Defense on July 22,
2015, to carry out such section 987.''.
(b) Clerical Amendment.--The table of contents for chapter 2 of the
Truth in Lending Act is amended by adding at the end the following:
``140B. Limitations on consumer credit and maximum rates of
interest.''.
(c) Applicability.--The amendments made by subsection (a) shall
apply to an extension of credit made after the earlier of--
(1) the date on which the rules issued by the Bureau of
Consumer Financial Protection under subsection (g) of section
140B of the Truth in Lending Act, as added by subsection (a) of
this section, require compliance; and
(2) the date that is 18 months after the date of enactment
of this Act.
<all>
Introduced in House
Introduced in House
Referred to the House Committee on Financial Services.
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