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Bill > SB784


CA SB784

Home improvement loans: right to cancel contracts.


summary

Introduced
02/21/2025
In Committee
05/23/2025
Crossed Over
06/02/2025
Passed
Dead

Introduced Session

2025-2026 Regular Session

Bill Summary

An act to amend Section 7159 of the Business and Professions Code, and to amend Sections 1689.6, 1689.7, and 1689.13 of, and to add Title 1.87 (commencing with Section 1799.220) to Part 4 of Division 3 of, the Civil Code, relating to consumer credit.

AI Summary

This bill proposes significant consumer protection reforms for home improvement loans and contracts. It extends the right to cancel home improvement contracts from 3 to 5 business days for most consumers, and from 5 to 7 business days for senior citizens, effective January 1, 2026. The bill introduces new requirements for lenders offering home improvement loans, including mandatory oral confirmations with consumers before loan execution. Lenders must verify key loan terms, ensure the consumer understands the contract, and provide information about the specific home improvements being financed. The bill also requires lenders to disclose dealer fees and provide consumers with detailed information about the loan, including potential financial risks and uncertainties. Consumers are given enhanced rights to request documentation about their home improvement loan, and lenders must maintain records for five years after the loan term. Importantly, the bill allows consumers to assert claims against lenders for misrepresentations made during loan solicitation and prevents repayment obligations from beginning until home improvements are confirmed as operational. The legislation aims to provide more transparency, protect consumers from potential predatory practices, and ensure borrowers fully understand the terms and implications of home improvement loans.

Committee Categories

Budget and Finance, Business and Industry, Justice

Sponsors (2)

Last Action

In Assembly. Read first time. Held at Desk. (on 06/03/2025)

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