HB6019 98TH GENERAL ASSEMBLY

LRB098 20730 ZMM 57690 b

98TH GENERAL ASSEMBLY
State of Illinois
2013 and 2014
HB6019

Introduced , by Rep. Robert Rita

SYNOPSIS AS INTRODUCED:

205 ILCS 675/3
205 ILCS 675/4	from Ch. 17, par. 7004
205 ILCS 675/6	from Ch. 17, par. 7006

Amends the Illinois Financial Services Development Act. In the definition of "financial institution", provides that certain lenders are prohibited from charging an annual percentage rate in excess of 36% (rather than prohibited from charging interest in excess of 36% per annum) for any extension of credit under the Act. Further provides that any financial institution may charge and collect interest and other charges under a revolving credit plan provided that any finance charges or charges representing the cost of credit are included in the annual percentage rate calculation. Limits the amount of certain fees that a financial institution may charge and collect from a borrower under a revolving credit plan.

A BILL FOR

AN ACT concerning regulation.

Be it enacted by the People of the State of Illinois, represented in the General Assembly:

Section 5. The Illinois Financial Services Development Act is amended by changing Sections 3, 4, and 6 as follows:

(205 ILCS 675/3)

Sec. 3. As used in this Section:

(a) "Financial institution" means any bank with its main office or, after May 31, 1997, a branch in this State, any state or federal savings and loan association or savings bank with its main office or branch in this State, any state or federal credit union with its main office in this State, and any lender licensed under the Consumer Installment Loan Act or the Sales Finance Agency Act; provided, however, that lenders licensed under the Consumer Installment Loan Act or the Sales Finance Agency Act are prohibited from charging an annual percentage rate interest in excess of 36% per annum for any extension of credit under this Act.

(b) "Revolving credit plan" or "plan" means a plan contemplating the extension of credit under an account governed by an agreement between a financial institution and a borrower who is a natural person pursuant to which:

(1) The financial institution permits the borrower and, if the agreement governing the plan so provides, persons acting on behalf of or with authorization from the borrower, from time to time to make purchases and to obtain loans by any means whatsoever, including use of a credit device primarily for personal, family or household purposes;

(2) the amounts of such purchases and loans are charged to the borrower's account under the revolving credit plan;

(3) the borrower is required to pay the financial institution the amounts of all purchases and loans charged to such borrower's account under the plan but has the privilege of paying such amounts outstanding from time to time in full or installments; and

(4) interest may be charged and collected by the financial institution from time to time on the outstanding unpaid indebtedness under such plan.

(c) "Credit device" means any card, check, identification code or other means of identification contemplated by the agreement governing the plan.

(d) "Outstanding unpaid indebtedness" means on any day an amount not in excess of the total amount of purchases and loans charged to the borrower's account under the plan which is outstanding and unpaid at the end of the day, after adding the aggregate amount of any new purchases and loans charged to the account as of that day and deducting the aggregate amount of any payments and credits applied to that indebtedness as of that day and, if the agreement governing the plan so provides, may include the amount of any billed and unpaid interest and other charges.

(e) "Credit card" means any instrument or device, whether known as a credit card, credit device, credit plate, charge plate, or any other name, issued with or without fee by an issuer for the use of the borrower in obtaining money, goods, services, or anything else of value on credit, but does not include any negotiable instrument as defined in the Uniform Commercial Code, as now or hereafter amended, or a debit card that may indirectly access an overdraft line of credit through a debit to a deposit account.

(f) "Credit card account" means a revolving credit plan accessed by a credit card.

(Source: P.A. 96-936, eff. 3-21-11; 96-1193, eff. 7-22-10; 97-333, eff. 8-12-11.)

(205 ILCS 675/4) (from Ch. 17, par. 7004)

Sec. 4. Notwithstanding the provisions of any other laws in connection with revolving credit plans, any financial institution may, subject to the other provisions of this Section 4, offer and extend credit under a revolving credit plan to a borrower and in connection therewith may charge and collect interest and other charges, provided that any finance charges or charges representing the cost of credit are included in the annual percentage rate calculation, may take real and personal property as security therefor, and may provide in the agreement governing the revolving credit plan for such other terms and conditions as the financial institution and borrower may agree upon from time to time. A financial institution offering or soliciting a revolving credit plan involving a credit card, or extending credit pursuant to the use of a credit card under any such plan, shall comply with provisions of "An Act relating to the issuance and use of credit cards", approved September 16, 1969, as now or hereafter amended.

(Source: P.A. 85-1432.)

(205 ILCS 675/6) (from Ch. 17, par. 7006)

Sec. 6. In addition to or in lieu of interest at a periodic rate or rates as provided in Section 5, and without limitation of the foregoing Section 4, a financial institution may, if the agreement governing the revolving credit plan so provides and clearly discloses, charge and collect as interest, in such manner or form as the plan may provide, an annual or other periodic fee for the privileges made available to the borrower under the plan, a transaction charge or charges, late fees or delinquency charges not to exceed $25 per billing cycle, returned payment charges not to exceed $25 per payment due, over limit charges not to exceed $25 per billing cycle, and fees for services rendered.

(Source: P.A. 85-1432.)