HB 1508 -- Payday Loans

Sponsor:  Still

This bill changes the laws regarding unsecured loans of $500 or
less, commonly known as payday loans.  In its main provisions,
the bill:

(1)  Prohibits repeated renewals of loans to circumvent interest
rate restrictions;

(2)  Prohibits lenders from making a loan to a person who
currently has a payday loan or from lending to a person within
one week of that person paying or otherwise satisfying in full a
payday loan;

(3)  Authorizes the Attorney General to issue cease and desist
orders for certain violations by lenders;

(4)  Allows the Attorney General to file a motion requesting a
circuit court to issue an injunction, restraining order, or
declaratory judgment; to impose a civil penalty of up to $1,000
per day; or to impose an order of rescission, restitution, or
disgorgement against a person or entity who has violated any laws
relating to consumer loans;

(5)  Specifies that these provisions apply to all lenders,
whether or not they are properly licensed pursuant to Chapter
408, RSMo; and

(6)  Limits the loan set-up fee that may be charged on a loan to
5% of the loan up to a maximum of $25 and limits the interest at
a simple annual rate not to exceed 36%.  Lenders must give a
borrower a minimum of 90 days to repay a loan with payments
required every two weeks so that the loan will fully amortize in
90 days.  No other charges can be assessed except as provided in
the bill including, but not limited to, late fees.

Missouri House of Representatives
95th General Assembly, 2nd Regular Session
Last Updated September 14, 2010 at 3:11 pm