COMMITTEE ON LEGISLATIVE RESEARCH
OVERSIGHT DIVISION
FISCAL NOTE
L.R. No.: 0136-01
Bill No.: SB 138
Subject: Credit and Bankruptcy; Banks and Financial Institutions; Consumer Protection
Type: Original
Date: January 7, 2003
FISCAL SUMMARY
| FUND AFFECTED | FY 2004 | FY 2005 | FY 2006 |
| Total Estimated
Net Effect on General Revenue Fund |
$0 | $0 | $0 |
| FUND AFFECTED | FY 2004 | FY 2005 | FY 2006 |
| Total Estimated
Net Effect on Other State Funds |
$0 | $0 | $0 |
Numbers within parentheses: ( ) indicate costs or losses.
0This fiscal note contains 3 pages.
| FUND AFFECTED | FY 2004 | FY 2005 | FY 2006 |
| Total Estimated
Net Effect on All Federal Funds |
$0 | $0 | $0 |
| FUND AFFECTED | FY 2004 | FY 2005 | FY 2006 |
| Local Government | $0 | $0 | $0 |
ASSUMPTION
Officials from the Department of Economic Development - Divisions of Finance and Credit Unions assume no fiscal impact from this proposal.
| FISCAL IMPACT - State Government | FY 2004
(10 Mo.) |
FY 2005 | FY 2006 |
| $0 | $0 | $0 |
| FISCAL IMPACT - Local Government | FY 2004
(10 Mo.) |
FY 2005 | FY 2006 |
| $0 | $0 | $0 |
FISCAL IMPACT - Small Business
This proposal could fiscally impact those small businesses that deal with credit transactions.
DESCRIPTION
This proposal would modify the maximum penalties a consumer must pay for late payments on certain credit transactions.
This proposal states that a lender may charge a late payment of 2% (reduced from 5%) of the minimum payment due or $15 (reduced from $25), whichever is less on a small loan payment which is fifteen days or more in default. A minimum late charge of $5 (reduced from $10) may be made. When the monthly installment due is less than $25, the maximum late charge that could be charged would be $2 (reduced from $5).
A loan fee for loans other than "open-end credit" that are for thirty days or longer may be charged a maximum loan fee of $75 (increased from $50).
In the case of "open-end credit" tied to a transaction account in depository institution, the creditor may charge a credit advance fee of the lesser of $25 or 5% of the credit advanced and such fee may be added to the open-end credit outstanding with any interest.
This legislation is not federally mandated, would not duplicate any other program and would not require additional capital improvements or rental space.
SOURCES OF INFORMATION
Department of Economic Development
Division of Finance
Division of Credit Unions
Mickey Wilson, CPA
Director
January 7, 2003