This bill amends existing laws related to debt management programs in Iowa, specifically addressing the requirements for licensees, the handling of debtor payments, and the fees associated with debt management services. It mandates that licensees maintain a separate bank or dedicated account for payments received from debtors intended for creditors, replacing the previous requirement for a trust account. Additionally, the bill removes the prohibition on licensees receiving third-party consideration for services rendered to debtors, thereby allowing more flexibility in their operations.

Furthermore, the bill establishes new conditions under which a licensee may charge fees for debt management services. Specifically, a licensee can only request payment if they have successfully renegotiated or altered the terms of a debt, and the debtor has made at least one payment under the new agreement. The fees charged must also reflect a proportional relationship to the total debt amount. The bill also exempts licensed debt management providers from certain regulations applicable to credit services organizations, streamlining their operations. Overall, these changes aim to enhance the regulatory framework governing debt management services in Iowa.

Statutes affected:
Introduced: 533A.8, 533A.9, 538A.2