Payday Loan Act; requires SCC to contract with one or more parties to develop, etc. database. (SB588)
Introduced By
Sen.
Phil Puckett (D-Tazewell)
Phil Puckett
(D-Tazewell)
Served: 1998–
Progress
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Introduced |
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Passed Committee |
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Passed House |
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Passed Senate |
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Signed by Governor |
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Became Law |
Description
Payday Loan Act. Requires the State Corporation Commission, by July 1, 2009, to certify and contract with one or more third parties to develop, implement, and maintain an Internet-accessible database, and requires payday lenders to query the database prior to making any loan to determine whether an applicant is eligible for the loan. Fifty cents may be charged to defray the costs of using the database. A payday lender is prohibited from making a payday loan to a person who has terminated a payday loan on the loan application date, or if the loan would cause the borrower to have more than three payday loans outstanding at the same time. Payday lenders are prohibited from knowingly making loans to a member of the military service or to the spouse or dependent of such person. If a borrower obtains three or more consecutive payday loans, the borrower may enter into an extended payment plan, which allows the borrower to repay the loan in at least two equal installments over 60 days. A payday loan may not be made to a borrower in an extended payment plan. Other provisions (i) prohibit a lender from engaging in any unfair, misleading, deceptive, or fraudulent acts or practices in the making or collecting of a payday loan; (ii) require a lender, when collecting or attempting to collect a payday loan when the check given as security for such loan is dishonored, to comply with certain restrictions and prohibitions contained in the Fair Debt Collection Practices Act; (iii) provide that any provision of a written loan agreement that violates the Payday Loan Act is unenforceable against the borrower; (iv) state that the provisions of the Payday Loan Act apply to Internet lenders; and (v) allow licensees to secure payday loans with the borrower's electronic debit authorization. View Full Text »
Status
03/08/2008: Passed the Senate
View Bill's History
Video
Votes were cast on this bill on the following dates for which Richmond Sunlight has video: 01/09/2008, 01/09/2008, 02/04/2008, 02/04/2008, 02/06/2008, 02/06/2008, 02/12/2008, 02/14/2008, 02/14/2008, 02/20/2008, 03/06/2008 and 03/11/2008.
Comments
This proposed change appears to be of prime benefit to the payday loan industry, not the borrower. It will provide the industry a database that protects them from making loans that are at high risk of not being repaid. The cost of this should be borne by the industry not the state or the borrower. There is no reason not to have the database but to label it as payday lender reform is at best misleading.
Kudos to the General Assembly for lowering the fees from 391% APR to 362% APR.