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Bill > HF878
IA HF878
IA HF878A bill for an act relating to annual percentage rates for delayed deposit service transactions.(Formerly HF 627.)
summary
Introduced
03/07/2025
03/07/2025
In Committee
04/03/2025
04/03/2025
Crossed Over
Passed
Dead
Introduced Session
91st General Assembly
Bill Summary
This bill relates to annual percentage rates for delayed deposit service transactions. Under the bill, a person licensed under Code chapter 533D (licensee) shall not impose an annual percentage rate greater than 36 percent in connection with a delayed deposit service transaction. A delayed deposit service transaction made in violation of the bill shall be void, and the licensee shall not collect, receive, or retain any principal, interest, fees, or other charges in connection with the delayed deposit service transaction. For an individual on active military duty, or their spouse or dependent, a licensee shall not impose an annual percentage rate greater than allowable under 10 U.S.C. §987 in connection with a delayed deposit service transaction.
AI Summary
This bill establishes new restrictions on annual percentage rates (APRs) for delayed deposit service transactions, which are commonly known as payday loans. The bill limits the maximum APR to 36% for all such transactions, effectively capping the interest and fees that payday lenders can charge. If a lender violates this rate restriction, the entire transaction becomes void, and the lender cannot collect any principal, interest, fees, or other charges. The bill includes a special provision for active military personnel, their spouses, and dependents, which references federal regulations (10 U.S.C. §987) that already provide additional protections against high-interest lending for military members. By implementing this 36% APR cap, the bill aims to protect consumers from potentially predatory lending practices and excessive interest rates that can trap borrowers in cycles of debt.
Committee Categories
Business and Industry
Sponsors (0)
No sponsors listed
Other Sponsors (1)
Commerce (House)
Last Action
Referred to Commerce. H.J. 896. (on 04/03/2025)
Official Document
bill text
bill summary
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bill summary
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bill summary
| Document Type | Source Location |
|---|---|
| State Bill Page | https://www.legis.iowa.gov/legislation/BillBook?ga=91&ba=HF878 |
| BillText | https://www.legis.iowa.gov/docs/publications/LGI/91/attachments/HF878.html |
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