The bill amends RCW 31.45.073 to update regulations regarding small loans in Washington State. It establishes that the maximum principal amount for small loans is set at $1,200, adjusted for inflation based on the consumer price index, or 30 percent of the borrower's gross monthly income, whichever is lower. The bill also specifies that the maximum term for a small loan cannot exceed 45 days unless extended by mutual agreement without additional fees. Additionally, it prohibits licensees from making loans to borrowers in default on other loans until those loans are fully paid or two years have passed.

Further changes include the requirement for the Department of Financial Institutions to calculate and publish the inflation-adjusted maximum loan amount annually starting January 1, 2027. The bill also modifies the interest and fee structure for small loans, allowing licensees to charge up to 15 percent on the first $500 of principal and 10 percent on any amount exceeding that. It maintains restrictions on the number of loans a borrower can receive within a 12-month period and clarifies that only one postdated check may be accepted as collateral for a small loan.

Statutes affected:
Original bill: 31.45.073