CODING: Words stricken are deletions; words underlined are additions.
House Bill 1211




    Florida House of Representatives - 1997                HB 1211

        By Representatives Effman and Lippman






  1                      A bill to be entitled

  2         An act relating to finance charge interest

  3         rates; amending s. 516.031, F.S.; revising the

  4         schedule for imposing rates of interest on

  5         certain loan amounts; providing an effective

  6         date.

  7

  8  Be It Enacted by the Legislature of the State of Florida:

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10         Section 1.  Subsection (1) of section 516.031, Florida

11  Statutes, is amended to read:

12         516.031  Finance charge; maximum rates.--

13         (1)  INTEREST RATES.--Every licensee may lend any sum

14  of money not exceeding $25,000.  A licensee may not take a

15  security interest secured by land on any loan less than

16  $1,000. The licensee may charge, contract for, and receive

17  thereon interest charges as provided and authorized by this

18  section.  The maximum interest rate shall be 30 percent per

19  annum, computed on the first $2,000 $1,000 of the principal

20  amount as computed from time to time; 24 percent per annum on

21  that part of the principal amount as computed from time to

22  time exceeding $2,000 $1,000 and not exceeding $3,000 $2,000;

23  and 18 percent per annum on that part of the principal amount

24  as computed from time to time exceeding $3,000 $2,000 and not

25  exceeding $25,000.  The original principal amount as used in

26  this section shall be the same amount as the amount financed

27  as defined by the federal Truth in Lending Act and Regulation

28  Z of the Board of Governors of the Federal Reserve System.  In

29  determining compliance with the statutory maximum interest and

30  finance charges set forth herein, the computations utilized

31  shall be simple interest and not add-on interest or any other

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CODING: Words stricken are deletions; words underlined are additions.






    Florida House of Representatives - 1997                HB 1211

    579-107-97






  1  computations.  When two or more interest rates are to be

  2  applied to the principal amount of a loan, the licensee may

  3  charge, contract for, and receive interest at that single

  4  annual percentage rate which if applied according to the

  5  actuarial method to each of the scheduled periodic balances of

  6  principal would produce at maturity the same total amount of

  7  interest as would result from the application of the two or

  8  more rates otherwise permitted, based upon the assumption that

  9  all payments are made as agreed.

10         Section 2.  This act shall take effect October 1, 1997.

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13                          HOUSE SUMMARY

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      Revises the schedule for imposing interest rates on
15    consumer finance loans of less than $25,000. See bill for
      details.
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