This bill amends the provisions related to delayed deposit services in Iowa by capping the annual percentage rate for fees at 10 percent, as determined by the federal Truth in Lending Act. It introduces a requirement for licensees to offer an extended repayment plan to individuals who obtain more than four delayed deposit service loans from the same licensee within a two-month period. This option must be requested by the borrower before the last check becomes negotiable, and during the repayment plan, the licensee is prohibited from initiating debt collection or legal proceedings for unpaid checks.

Additionally, the bill stipulates that the extended repayment plan must be documented in writing and signed by both parties, outlining a payment schedule that allows the borrower to pay off their obligations in at least four equal installments. Licensees are also required to return any postdated checks related to the original loans and may either request a new check for the balance or multiple checks for each scheduled payment. If the borrower fails to make a scheduled payment, the licensee can then charge a penalty and pursue collection actions. Violations of the bill may incur administrative fines up to $5,000 per infraction.

Statutes affected:
Introduced: 533D.9