The bill amends the Credit Reform Act of 1995 by revising Section 4 to impose stricter regulations on interest rates charged by regulated lenders. Specifically, it prohibits these lenders from charging, collecting, or receiving any interest or finance charge for an extension of credit that exceeds 10% per annum. This change replaces the previous allowance for interest rates up to 25% and eliminates the provision that allowed depository institutions to charge any rate for credit card arrangements.

Additionally, the bill clarifies that the interest or finance charge calculated on the principal balance for extensions of credit made to individuals for personal, family, or household purposes must be computed solely on the basis of the unpaid balance. This amendment aims to protect consumers from excessive interest rates and ensure fair lending practices.

Statutes affected:
House Introduced Bill: 445.1854