SB505: Bill Text

SB505, s. 1 Section 1. 138.05 (6) of the statutes is amended to read:

SB505,2,3 138.05 (6) This section does not apply to transactions governed by chs. 421 to 427 or to discounts described in s. 422.201 (8) or (10) (e).

SB505, s. 2 Section 2. 403.806 of the statutes is amended to read:

SB505,3,2 403.806 Liability for worthless check or draft. Any person who issues a check or other draft which is not honored upon presentment, because the drawer does not have an account with the drawee or because the drawer does not have sufficient funds in his or her account or sufficient credit with the drawee, is liable for all reasonable costs and expenses in connection with the collection of the amount for which such check or draft was written, except recovery is not permitted under this section if a person licensed under s. 138.09 or any other person collected or could have collected a charge for that check or other draft under s. 422.202 (1) (d) or (2m) (cm).

SB505, s. 3 Section 3. 422.201 (2) (c) of the statutes is repealed.

SB505, s. 4 Section 4. 422.201 (10) of the statutes is repealed.

SB505, s. 5 Section 5. 422.201 (10m) of the statutes is repealed.

SB505, s. 6 Section 6. 422.201 (10s) of the statutes is created to read:

SB505,3,9 422.201 (10s) Regardless of the date that an open-end credit plan is entered into, the parties may agree to the payment by the customer of a finance charge at any periodic rate.

SB505, s. 7 Section 7. 422.202 (2m) of the statutes is repealed and recreated to read:

SB505,3,12 422.202 (2m) With respect to an open-end credit plan, regardless of when the plan was entered into:

SB505,3,18 (a) A creditor may charge, collect and receive other fees and charges, in addition to the finance charge authorized under s. 422.201, that are agreed upon by the creditor and the customer. These other fees and charges may include periodic membership fees, cash advance fees, charges for exceeding a designated credit limit, charges for late payments, charges for providing copies of documents and charges for the return of a dishonored check or other payment instrument.

SB505,3,21 (b) For purposes of 12 USC 85, 1463 (g), 1785 and 1831d, both the finance charge under s. 422.201 and charges permitted under par. (a) are interest and may be charged, collected and received as interest by a creditor.

SB505,3,24 (c) For purposes of 12 USC 85, 1463 (g), 1785 and 1831d, the terms and conditions of an open-end credit plan, including the following provisions, are material to the determination of the interest rate:

SB505,4,2 1. Provisions relating to the method of determining the balance upon which the interest or finance charge is applied.

SB505,4,4 2. Provisions regarding the time periods within which fees and charges are applied or within which they may be avoided.

SB505,4,5 3. Default provisions.

SB505,4,6 4. Cancellation provisions.

SB505,4,7 5. Choice of law provisions.

SB505,4,9 6. Provisions regarding changes in the terms and conditions of the open-end credit plan.

SB505, s. 8 Section 8. 422.415 (1) of the statutes is amended to read:

SB505,4,19 422.415 (1) Except as provided in sub. (2), no creditor shall make any change in the terms of open-end credit plans that is adverse to the interests of the customer with respect to any outstanding balances or that imposes or alters a charge permitted under s. 422.202 (2m) (a) to (cm) or (e). For the purposes of this section, a change shall be presumed to be adverse if the result thereof is to increase the rate of the finance charge or the amount of the periodic payment due. Outstanding balances shall be determined on the assumption that all payments shall be credited first to any finance charges that may be due and then to the payment of debts in the order in which the entries to the account showing the debts were made.

SB505, s. 9 Section 9. 422.415 (2) (intro.) of the statutes is amended to read:

SB505,4,24 422.415 (2) (intro.) A change that is adverse to the interests of the customer with respect to outstanding balances or that imposes or alters a charge permitted under s. 422.202 (2m) (a) to (cm) or (e) may be made if any of the following conditions is met:

SB505, s. 10 Section 10. 422.421 (1) (c) of the statutes is amended to read:

SB505,5,7 422.421 (1) (c) "Variable rate transaction" means any open-end credit plan and any consumer credit transaction other than one pursuant to an open-end credit plan, the terms of which permit the rate of finance charge to be adjusted from time to time during the term of the plan or transaction other than by an adjustment under s. 422.201 (10m) or 422.415, but does not include any consumer credit transaction the terms of which permit only the rates of finance charge that are initially numerically specified in any document evidencing the plan or transaction.

SB505, s. 11 Section 11. 422.421 (6) (a) 1. of the statutes is renumbered 422.421 (6) (a).

SB505, s. 12 Section 12. 422.421 (6) (a) 2. of the statutes is renumbered 422.421 (6) (c) and amended to read:

SB505,5,13 422.421 (6) (c) The maximum rate of finance charge established under subd. 1. par. (a) shall continue in effect for the entire term of the payment period regardless of any changes in the limit set forth in s. 422.201 (2) (bm) during the payment period.

SB505, s. 13 Section 13. 422.421 (6) (b) of the statutes is repealed.

SB505, s. 14 Section 14. 426.201 (5) of the statutes is amended to read:

SB505,5,17 426.201 (5) No person is subject to this section solely by reason of offering the discount described in s. 422.201 (8) or (10) (e).

SB505,5,18 (End)